Ofwat has unveiled ambitious plans to address pollution and improve water resilience, backed by a substantial £104 billion investment program for the PR24 period (2025–30). These improvements, however, come with significant cost increases for customers.
This morning, Ofwat announced that water bills in England and Wales will rise by an average of 36% by 2030, with increases taking effect from April 2025. Crucially, this headline percentage excludes additional annual rises linked to inflation, which water companies are also permitted to pass on to customers. The net result is that average prices are likely to be even higher than predicted by 2030.
At the Waterscan Self-Supply and Customer Conference in September, we predicted a 50% increase in water bills for business customers over the next five years. Today’s announcement reinforces that expectation, with the Southern Water region seeing the largest increase at 53%. A detailed breakdown of regional impacts across all 17 water companies will be published shortly.
Investment in resilience
A key aspect of the PR24 plans is investment in resilience through the Water Resources Management Plan. This includes constructing 30 major infrastructure projects, such as nine new reservoirs, to ensure water supplies meet the needs of a growing population and support drought resilience. These measures aim to prevent the risk of running out of water while ensuring long-term sustainability.
Key highlights of the investment program
- Storm Overflow Reduction: Nearly £12 billion allocated to cut spills from storm overflows by 45% from 2021 levels.
- Drought Resilience: £50 billion earmarked for infrastructure projects, with £2 billion in seed funding. This will support water supplies sufficient for the daily needs of around a third of England and Wales’ population.
- Environmental Standards: Nearly 90% of the investment will address new requirements from the Environment Agency, Natural Resources Wales, and the Drinking Water Inspectorate.
Efficiency: A critical priority for businesses
For business customers, these changes highlight the urgent need to improve water efficiency and reduce usage. Higher tariffs and trade effluent charges will target high-consuming sites, making it essential for businesses to adopt sustainable practices. By using less water, businesses can mitigate rising costs while contributing to the sector’s long-term resilience.
At Waterscan, we emphasize the importance of aligning business strategies with these challenges. By prioritising efficiency and conservation, businesses can play a pivotal role in supporting the sector’s goals while managing their own costs effectively.
