Southern Water asks to put bills up by even more than first planned

Bills could go up by 84% between now and 2030

Southern Water
Author: Kat Wright and PA business reporter, Alex DanielPublished 22nd Oct 2024

Southern Water is asking to put bills up by even more than first planned - by 84% over the next five years

All but one of the 11 water companies covering England and Wale have asked to hike consumer bills by more than they originally requested, according to figures released by watchdog Ofwat.

But Southern Water - which serves Sussex, Kent and Hampshire - has asked to raised them by the most.

The latest requests by water firms would see the average consumer bill in England and Wales rise by 40% between now and 2030, costing £615 per year.

Need to spend more on upgrading pipes, sewers and reservoirs

Earlier this year, companies asked Ofwat for bills averaging £585 by 2030, an increase of about one-third from the current average of £439.

This summer, the regulator pared back those requests to an average of £535, in its draft price review in July.

But now, after a consultation period, 10 of the 11 water companies have hit back with even higher requests than before.

Many argue that they need to spend more on upgrading their pipes, sewers and reservoirs than originally planned, and therefore need bills to go up too.

Ofwat wrote in an update on Tuesday that this was "mostly to meet the requirements of other regulators like the Environment Agency and Drinking Water Inspectorate".

But some of the increases are designed to meet "changes to the proposed rate of return for investors".

Final decision in December

Ofwat is due to make a final decision on bills increases on December 19, with companies going to the negotiating table with regulators before then.

The regulator wrote: "We will consider this additional expenditure request as part of our final determinations"

The latest string of demands come amid public and political outcry over sewage spills in the privatised water industry, while companies' investors receive dividends and top executives get bonuses.

A recent performance report by Ofwat showed there has only been a 2% reduction in pollution since 2019 despite firms committing to cutting it by 30%.

Labour has suggested sweeping new laws which could see bosses face up to two years in jail if they obstruct regulators - but so far nothing has come into force.

Thames Water, the UK's biggest provider, which is in emergency talks over a £15 billion debt pile and a worsening financial situation, has asked for a 53% rise.

The next biggest hikes are by Severn Trent Water, of 46% to £580, and north Wales provider Hafren Dyfrdwy, of 45% to £568.

Only one company, Wessex Water, is not demanding higher bills than first requested.

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