Water firms face £240m in penalties but households will STILL pay billions more under Ofwat's plans
Thames Water, which would see £46 million returned to its customers under Ofwat's proposals, is among the underperforming firms facing penalties dwarfed by a separate £3.4 billion in extra bill rises being sought…
Yorkshire Water and Thames Water are set to face the largest penalties under Ofwat's draft proposals — £75m and £46m respectively — with both sums to be passed back to customers via reduced bills from April 2027. The regulator had already approved a separate £3.4bn annual tariff increase on top of the 36 per cent average rise locked in for the five years to 2030. Sector-wide, net bill reductions will total £240m by 2029-30, with £107m of that returned in 2027-28. The average Yorkshire Water customer would save just £27, while Thames Water customers would see a cut of only £7.
Ofwat's final ruling on the penalty payments is due by December 15, with the changes reflected in bills from April 1, 2027.
Severn Trent and Northumbrian Water avoid fines altogether and are instead in line for outperformance bonus payments.
Andy Burnham has introduced new legislation allowing struggling water companies to be brought into public ownership, pledging a 10-year journey toward a 'very different water system'.
