Millions of Londoners will see their water bills increase from 2027 after five water companies received provisional approval from regulator Ofwat to raise charges. The decision, announced on 18 August 2026, allows Severn Trent, Southern, South East, Thames, and Wessex to increase prices from 2027 to 2030, funding a £3.4 billion investment programme aimed at improving infrastructure and supporting new housing and data centres.
Approved price rises and affected customers
Ofwat has detailed the permitted increases for each company. Southern Water, which serves approximately 4 million households, can raise charges by £43 in 2027/28, the largest hike. While Southern Water does not serve London postcodes directly, some customers in Kent, just outside the capital, will be affected.
Wessex Water is permitted to increase bills by £4, while Thames Water and Severn Trent can each add £3 to customer bills. South East Water can raise charges by £1 in 2029/30, according to Ofwat.
Investment and regulatory oversight
Helen Campbell, executive director for delivery at Ofwat, said: "The newly agreed funding will help unlock much-needed new housing development and boost business growth across a range of sectors, as well as improving drinking water quality and the removal of PFAS and forever chemicals."
She added: "We will track performance to ensure companies are delivering the expected improvements for customers and the environment. If they don't, expenditure can be clawed back."
Controversy and political reaction
The approval follows a previous 36 per cent increase in water bills from 2025 to 2030, already permitted by Ofwat, which has sparked controversy. Prime Minister Andy Burnham criticised the proposals, stating: "Customers cannot be treated as a blank cheque. Where water companies seek to pass unnecessary costs on to households, they will be challenged."
Ofwat has opened a three-month public consultation on the provisional approvals, with a final determination expected in December. The investment programme is designed to enable the construction of additional housing and data centres, while also improving drinking water quality and removing PFAS and other forever chemicals.
