Indebted UK water supplier proposes massive bill hike

LONDON: Britain’s largest water supplier Thames Water on Wednesday said it needs to massively increase what it charges customers, saying that spending cuts proposed by the industry regulator were “not tenable”.

The company -- dogged by financial troubles -- proposed a more than 50 per cent increase in bills over the next five years to finance what it says are “much needed” investments.

Regulator Ofwat has already rejected an initial proposition by the company to increase bills by 44 per cent by 2030, deeming that certain proposed expenses were “not well justified”.

And in its recommendations for water companies last month, Ofwat proposed capping bill hikes at 23 per cent over the next five years, and imposing spending limits. It will make a final decision in December, following a consultation.

Thames Water, which serves around 16 million homes and businesses in London and elsewhere in southern England, has been riddled with debt and has faced fines and criticism over failures to plug raw-sewage discharges in rivers.

Thames Water has now said that the proposed spending cuts would make it harder to attract investors.

Bills could rise by as much as 59 per cent by 2030, bringing them to an average of GBP696 ($920) a year, it said in its response to Ofwat.

While it rejected spending cuts and “unachievable” targets, Thames Water said it would accept “many” Ofwat recommendations including water performance commitments.

“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,” said Thames Water CEO Chris Weston.“They are not being asked to pay twice, but to make up for years of focus on keeping bills low,” Weston added.