Southern Water customers face a bill increase of £230 per year (44%) from 2025 until 2030 to help cover the cost of a £7.8billion investment in the service.
Wastewater only customers will see average bills increase by £85 per year (27%) between 2025 to 2030. Water only customers will see average bills increase by £145 per year (69%) between 2025 to 2030.
For those who pay monthly it means a rise by just under £9 per month from 2025 increasing to just over £19 per month by 2030 (costs before inflation). For wastewater only customers this will be just over £2 per month from 2025 increasing to just over £7 per month by 2030 (costs before inflation).
Southern Water says there has been significant new investment from shareholders of £1.6 billion since 2021, who have not received a dividend since 2017.
Yesterday (October 2) Southern Water released its proposed Business Plan for 2025-30.
The company said it will “deliver major improvements in water resilience, wastewater treatment, and customer service, as well as enhancement and protection of our precious environment.
“To deliver this major and ambitious plan, our customer bills will increase to pay for this future investment.”
A record £7.8 billion has been outlined to address the challenges. Southern Water says the plan will create an estimated 5,000 jobs across the region and represents around £3500 per household.
It adds: “The issues we are tackling are long term, so this Business Plan is the first major step in our longer-term strategy to 2050.
“This includes the single largest investment made to date of £3.3 billion in improving our environment, which will see us reduce our impact on rivers by cutting the amount of water we take from them, build new longer-term water sources, upgrade our largest water and wastewater treatment sites, boost water quality, reduce storm overflows, and support new housing developments.
“We face major challenges in our region that we need to plan for and manage in the longer-term, from increased consumption through an expected population growth of 3.2 % over the next 10 years, approximately 2.2 million more people, to the impact of climate change with more volatile weather and risks of drought. Collectively, we need to urgently reduce pollution and the amount of water we take from the environment.
“We understand the burden the rising cost-of-living is having on customers. We will mitigate the effects of bill increases by spreading the costs over a five-year period. We are also extending our social tariff to support 50% more customers than we do currently so more customers can get up to 45% off their bills, increasing our hardship fund fourfold, and extending our Priority Services Register. “
Southern Water say key investment highlights include:
£3.4 billion to be invested in water supply services. Including:
£320m to upgrade the four largest water supply works to improve resilience
Reducing the amount of water taken from the environment to supply as drinking water – by 50 million litres a day by 2030, a reduction of 10% from 2022.
The construction of water recycling plants and new pipelines to help deliver more than 189 million litres of extra water per day by 2035.
£4.1 billion in wastewater services. Including:
£682m to reduce use of storm overflows by up to 20% by 2030 across 179 priority sites.
Reduce pollution incidents by 50% and eliminate serious pollution incidents by installing new mains and increasing power resilience at pumping stations
£600m to upgrade 38 wastewater treatment sites to remove harmful nutrients and improve the quality of water put back into the environment and help accommodate over 60,000 new homes by 2030.
£348 million to provide trusted and easy-to-use customer services through investing in a new customer relationship management and billing system
Southern Water is due to publish a detailed proposal on how it will tackle storm overflows in 179 priority bathing and shellfish sites across the region.
Lawrence Gosden, Southern Water’s CEO, said: “Our proposed record £7.8bn investment over 2025-2030 aims to build on the foundations of our turnaround plan where we promised to deliver a short, sharp, ambitious performance improvement by 2025.
“The investment will ensure significant improvements to the environment in our region including improving water quality in 1,000km of river by upgrading our wastewater treatment works. It will also deliver major improvements in water resilience, in the way we treat wastewater, enhance customer service and increase the number of jobs in our region by an estimated 5,000.
“We know that our past performance has not lived up to our customers’ and our regulators’ expectations so whilst customer bills will increase, our customers will only pay for future investment, not our past underperformance. We will also mitigate the effects by spreading increases over the regulatory period and significantly increasing our support for vulnerable customers.
“This is right for our environment, communities, investors, and above all for our customers. We look forward to working with Ofwat on their draft determination of our plan next year.”
County Councillor and Save Our Seas Ramsgate member Karen Constantine said: “So Southern Water are planning to charge us more for our water. Well they did warm us this was precisely what they were planning to do.
“When I called a public meeting in 2021 with the then Chief Executive of Southern Water Ian McCauley, he was quite clear when he said, based on his experience of working in water companies around the world, he thought water in the UK was too cheap! If we wanted infrastructure improvements (and clean seas) we’d better be prepared to pay for it! At least he told us straight. But the good news ends there. How can Southern Water possibly justify these increases? Will they still pay their executives top dollar? Will they stop shareholders dividend’s – after all they don’t deserve them – not for one minute.
“The people of Ramsgate were promised testing kits so that we could test the local seas (that we use daily,) to check the cleanliness. This is a promise they appear to have broken. I’ll be back in touch with Lawrence Gosden, Southern Water’s CEO seeking clarity on this. Their communications team also seem to have forgotten the need to communicate with the local Save Our Seas group and others. That simply isn’t good enough. We must hold them to their word.
“It’s frankly insulting to be expected to pay higher bills while the company remains in private hands. If we’re going to have to pay more I’d at least like to see that money going into a public owned company. Let’s continue to apply pressure for this long overdue, popular and morally right change.”
Thanet Green Party councillor Mike Garner said: “Residents across Thanet have known for years that Southern Water’s infrastructure is not fit for purpose, despite them previously claiming otherwise.
“We’ve seen multiple sewage releases into the sea over the last few years and on numerous occasions, we’ve had our fresh water supply cut off. As well as seriously impacting our coastal environment, each of these incidents has adversely affected our tourism industry and the businesses that rely on it being successful.
“While I welcome Southern Water, finally, outlining how they are going to start to put things right, it’s outrageous that they are going to charge us to pay for it by significantly increasing our bills when, as Feargal Sharkey and many others have highlighted this week, and OFWAT confirmed in 2021, they’ve already had the money from us to do this. Before putting our bills up, they need to tell us what they did with the money they already had from us. “