Households could be paying up to £156 more for their water within six years to help fix problems including leaks and shortages.

Water companies have unveiled plans to also tackle sewage spills and discharge releases - but the work means customer bills will need to rise and here’s why.

Plans for improvement

The nation’s water companies have released their plans for the next ‘price review period’, which covers the years 2025 to 2030.

The proposals, which will be scrutinised by regulator Ofwat before any final decisions are made in December 2024, set out how firms plan to improve services over the next few years taking into account both their potential impact on the environment and how changes might affect customers.

Pollution problems and water shortages

Ofwat says it has made it clear to firms that there is a ‘pressing need’ for companies to reduce pollution from storm overflows and to improve river and bathing water quality by tackling the amount of untreated sewage discharged.

It also wants to see firms bolster their capacity to make sure that England and Wales can manage the issues created by climate change and population growth when it comes to supplies. All while supplying ‘world-class’ drinking water to millions of homes and businesses across the country.

So what’s planned?

Water companies want to spend £96 billion between 2025 and 2030, which would be an 88% increase on the previous five years.

Billed as the ‘largest ever’ investment made by the water industry, the money would help pay for 10 new reservoirs and major water transfer schemes that could eventually move water from places where there is a healthy supply to areas where it is most needed.

England’s ageing pipes would also get an upgrade, under the project, to reduce leaks by 28% and there is also work to tackle 140,000 sewage spills that happen each year – the estimated equivalent of 6,800 Olympic sized swimming pools.

South East Water has described this new business plan as the most important in the company’s history as it says it recognises its service ‘has not been of the high standard expected of it’ in the past few years.

David Hinton, CEO, explained: “The level of supply interruptions our customers have experienced has been too high. It has impacted on customer satisfaction and undermined the confidence that customers and stakeholders have in us to provide today’s public water service.

“We are proposing an ambitious level of investment, over the next five years we propose to invest almost £1.9 billion into the network to deliver a reliable and high-quality service for our customers, while also ensuring that the environment thrives.”

Paying for the work

Water bills will need to rise, say firms in their proposals, to help meet the cost of the work.

However charges, say Ofwat, must remain fair and the regulator has made it clear in its expectations that customers can’t be expected to pay for ‘past mistakes’ by companies but only future investment.

The scale of the work proposed by suppliers over the next six years, means that the average bill in England will need to rise by £7 a month by 2025 and by £13 a month by 2030.

That equates to an increase of around £156 a year by the end of decade.

However, in acknowledging the cost of living crisis and the current pressures already on people’s outgoings, water companies have pledged to do more to help those struggling.

The report explains: “While increasing bills is never welcome, we urgently need investment in our water and sewerage infrastructure.

“However, we understand the pressures people are facing with the cost of living and we are determined that no one is left behind. That’s why water companies have committed to tripling the number of households that will receive support with bills to 3.2m.”

David Henderson, chief executive of Water UK, which acts as a voice for the water industry, said the work being outlined was essential.

He added: "These record-breaking investment proposals will secure our water supply as we deal with a changing climate and a growing population.

"While increasing bills is never welcome, this investment in our country's infrastructure is essential to ensure the security of our water supply.

"Water companies are seeking regulatory approval to reduce overflow spills into rivers and seas as fast as possible and to doubling the number of households receiving support to pay their bills. Ofwat now needs to back these plans that are both ambitious and vital.”