Water bills are expected to rise by £19 per year to fund investment into Britain’s ageing infrastructure, Ofwat has declared.
It means the average household water bill across the UK will increase from £441 to £535 by 2030, an increase of 21%.
This is below the average asked of Ofwat by Thames Water, United Utilities and other major water firms.
Ofwat laid out the plans in the regulator’s draft determination, which sets the agenda for all UK water firms over the next five years.
It has proposed total investment spending to increase to £88 billion between 2025 and 2030, a 50% increase from the previous draft determination.
Ofwat expects water companies to triple investment in new infrastructure and resources “to improve the environment, resilience and service”.
“We expect increased investment to be reflected in better performance,” said Ofwat.
“We set each company targets for up to 23 areas of performance which are important to customers.
“If companies do not meet their targets each year, they will face automatic penalties, reflected in reduced bills. But there are incentives to beat the targets, and good performance will be rewarded.”
South West Water owner Pennon and United Utilities said they will review Ofwat’s draft determination and will respond by 28 August.