Awful April is just weeks away and households are bracing themselves for huge increases in their bills.
While council tax and energy bills are set to rise, the biggest price hike in percentage terms is likely to come from your tap.
Every water supplier across the country will raise prices by at least 20 per cent despite backlash against the industry as a whole, amid sewage leaks and poor customer service.
We explain why prices are rising and how you can cut your bill.
Price hikes: Households will pay up to £200 more a year after an Ofwat review of water bills
How much do people currently pay for water and how is it calculated?
In England and Wales, there are regional differences in water rates, meaning that a person in Yorkshire won’t have the same bill as someone in Essex.
Most households will be charged a yearly rate, which includes water supply and other associated costs, which is based on the rateable value (RV) of your home.
The RV is based on property assessments carried out between 1973 and 1990, so if you live in a highly-rated property you could be paying too much for your water.
Unlike energy, you can’t switch to a new supplier and you’re stuck paying what your local supplier charges.
One way to keep costs down is to install a water meter to more accurately track your usage, but not all households are suitable for them.
Both metered and unmetered bills will charge for water and sewerage, which is water that goes back into the system to be treated.
Why are water bills increasing?
If you’ve been paying close attention to your bills, you’ll have noticed that April won’t be the first time you see a hefty increase.
In 2019, water bills were raised by an average of £8, following an increase of £9 in 2018/19, bringing bills to around £415 a year.
Now, they are on track to reach over £600 on average, with some households paying over £200 more every year until 2030, after regulator Ofwat signed off on the price hikes after a review.
Southern Water customers face the steepest hike of 47 per cent this year, bringing the annual bill from £478 to £703.
This is followed by Thames Water, which will raise prices from £488 a year to £639, representing a 31 per cent rise.
Anglian Water and Northumbrian Water customers will face smaller rises of 19 per cent, but the annual bill will still be much higher at £626 and £506, respectively.
The Consumer Council for Water warns that these bills could rise even higher as the quoted figures don’t take into account inflation, which suppliers are allowed to add to customers’ bills every year.
Every five years, Ofwat reviews water companies’ investment plans and sets limits on what they can charge customers.
The regulator says the upcoming price increases will ‘help finance essential investment in the water sector, which includes meeting new environmental requirements’.
The extra cash will also pay for much-needed upgrades to pipes and reservoirs, but will also go towards paying investors.
David Black, chief executive of Ofwat said: ‘While bills are rising, the £104billion investment we have approved over the next five years will accelerate the delivery of cleaner rivers and seas and help to secure long-term drinking water supplies for customers.
‘This is an ambitious programme of work, and we now need to see companies deliver significant improvement in performance for customers and the environment.
‘Where companies underperform, or investment isn’t delivered, we will hold companies to account and protect customers.’
| Company | 2024/25 | 2025/26 | Change (£) | Change (%) |
|---|---|---|---|---|
| Anglian Water | £527 | £626 | £99 | 19% |
| Dŵr Cymru (Welsh Water) | £503 | £639 | £136 | 27% |
| Hafren Dyfrdwy | £447 | £590 | £143 | 32% |
| Northumbrian Water | £426 | £506 | £79 | 19% |
| Severn Trent Water | £457 | £556 | £99 | 22% |
| South West Water (south west region) | £520 | £686 | £166 | 32% |
| Southern Water | £478 | £703 | £224 | 47% |
| Thames Water | £488 | £639 | £151 | 31% |
| United Utilities | £486 | £598 | £112 | 23% |
| Wessex Water | £556 | £669 | £113 | 20% |
| Yorkshire Water | £467 | £602 | £136 | 29% |
| Source: Water UK | ||||
Outrage at unfair increases
Customers have started to receive letters from their water company laying out the full extent of their bill increase and unsurprisingly, they are not happy.
Thames Water and Southern Water customers are particularly outraged that they are facing further increases.
Mike Keil, chief executive of CCW, anticipated Thames Water customers would be ‘incensed the company now has the temerity to pursue an even larger increase.
‘This is a company which has a poor track record on service delivery and customer complaints, so people will rightly question why it should be trusted even more of billpayers’ money.’
One customer on X said they were ‘seething’ after receiving a letter from Thames Water, saying they could not fit a water meter, while another questioned how much Thames Water is paying its shareholders and management.
Thames Water has previously said it will not use the increase to improve its financial position, saying this was ‘untrue and misleading’.
‘The proposed extension to our debt is an interim funding solution. It won’t impact our increase in customer bills. We’re working through the next steps to stabilise the business further. This is so we can deliver an investable and financeable business plan.
‘Money we raise won’t be used to pay off our debt or external dividends. We’re also following Ofwat’s guidelines on bonuses. We won’t use customer bills for executive bonuses unless our performance meets expectations’.
That won’t stop people complaining about an unprecedented rise in their bills, particularly as it coincides with other price hikes, including energy, broadband and council tax.
Another X user said: ‘Inflation alert! Just received an email from Thames Water. Our water bill will go up by over 40pc in April! The average rise across the UK will be 26pc, adding about 0.1 percent to CPI inflation. Another unhelpful addition to inflation, alongside energy prices, NI + min wage.’
A survey by the CCW published last year found that two in five households will struggle to afford the price hikes.
A water meter can be a good way to track usage but some households aren’t eligible
How to save money on water bills
There have been calls for a water price cap akin to Ofgem’s energy price cap, while the Consumer Council for Water is calling for a new single social tariff.
Despite lobbying efforts, there doesn’t seem to be anything on the horizon to change the current system, but there are some ways you can cut your water bill.
Consider a water meter
Getting a water meter is usually the best way of saving money on bills, for those that don’t use an above-average amount of water. Around 40 per cent of households in England and Wales don’t have one.
Water companies will usually give you two years to trial one and allow you to switch back if you are unhappy.
The CCW has a calculator that helps you understand if a water meter could save you money.
However, the rule of thumb is that a water bill could lower your bills if you live in a property with a high ‘rateable value’ (the formula used to set estimated water bills), do not use much water or live alone.
A water meter will allow you to track your usage more closely and use less water if you can, bringing down your overall bills.
Check if you are eligible for a social tariff
Every water company in England and Wales has its own social tariff scheme designed to help customers on a low income.
But who is eligible and the level of support offered varies hugely from company to company.
In some instances, bills can be reduced by as much as 90 per cent. CCW has a list of social tariffs and criteria on its website.
Have you received a shock water bill increase? editor@thisismoney.co.uk
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