Thames Water says it has to raise bills by 59% over next five years
28 August 2024, 16:03
Thames Water has said it will have to increase bills by 59% by 2030 in a new business plan for the coming years.
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In its response to Ofwat's draft determination on water companies' plans, Thames proposed raising average yearly water bills to £666.50 per customer by 2030, a 52% rise.
That could rise to £696, a 59% increase, if it is given extra spending allowances by the regulator.
The average bill over the five year period from 2025 to 2030 would be £638 under the proposal.
Average bills in 2023 to 2024 were £433.
The proposal is an increase on Ofwat's proposal of raising bills by 23% over the period, which the regulator put forward in July, and more than Thames' previous planned increase of 44%, submitted to the regulator in April.
The company said the main driver of the increase is "due to an update to our customer numbers which sees a customer reduction from our original plan", as well as previously forecast increases in spending.
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Chris Weston, chief executive of Thames Water, said: "We want to deliver a considerable increase in investment in our infrastructure, with total expenditure of £20.7bn in our core plan and a further £3bn through gated mechanisms."
He added: "The money we're asking for from customers will be invested in new infrastructure and improving our services for the benefit of households and the environment.
"They are not being asked to pay twice, but to make up for years of focus on keeping bills low."
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It comes after a water industry body warned that Ofwat's plans to cap water bills could create a "material risk" that suppliers may fail to raise enough cash to invest in stopping sewage leaks.
Industry trade association Water UK said Ofwat's draft plans to limit the rise in household water bills to £19 a year on average will hold back firms' ability to improve their services.
In a letter to Ofwat chief executive David Black on Wednesday, the group also warned that the bill cap will drive away investors needed for a multibillion-pound spending plan to bring Britain's water infrastructure up to scratch.
Water UK boss David Henderson wrote: "Ofwat's approach would make it impossible for the water sector to attract the level of investment that it needs and will reduce the UK's attractiveness to international investment."
