Ofwat will allow Thames Water to raise its annual bills by £99 over the next five years, falling significantly below what the London and Southeast of England water supplier wanted.
Ofwat made the announcement in its latest draft determination, which sets investment and pricing targets for Britain’s water suppliers.
Thames Water was seeking a £191 bill rise to support investment in creaking infrastructure.
As well as slashing Thames Water’s pricing wishes, Ofwat has outlined some strict expectations of the water supplier.
Ofwat expects Thames Water to deliver a 19% reduction in leakage, an 18% reduction in phosphorus and a full 50% reduction in pollution incidents from average 2020-23 levels.
Over 2025-30, Thames Water should deliver a 66% reduction in water supply interruptions and a 55% reduction in internal sewer flooding events from 2020-23 levels.
Thames Water is expected to deliver £16.9 billion worth of total infrastructure improvements.