The Water UK chair has affirmed that while the companies will initially front the investment, they will recuperate the funds via increments to the water bills.
Customers will bear the cost of a £10bn investment by water companies to curtail sewage spills, paying through “slight increments in their bills”, according to Ruth Kelly, Chair of Water UK.
In her interview with Sky News, Kelly mentioned that water companies would initiate this grand project, the largest of its kind since the Victorian era, by making a “massive multi-billion initial investment”.
She further clarified, “The mechanism of the system allows for the cost of these assets to be reimbursed over their lifespan via minimal increases in the customers’ bills.”
Ms. Kelly indicated that in the past decade, the majority of people have witnessed a decrease in their water bills and that “studies have revealed customers’ willingness to slightly increase their payments for such large-scale investments.” During her appearance on BBC Breakfast, she explained that customers might be financially contributing to these developments for a time span of 50 years or even more, potentially extending to a century.
This development comes in the wake of public indignation about hefty bonuses and dividends received by water company executives while immense quantities of untreated sewage continue to contaminate the UK’s rivers.
Previously, the industry group Water UK committed to a £10 billion investment to address these issues and expressed understanding and apology to activists who they acknowledged as “rightfully outraged”.
However, this initiative has faced scepticism from those questioning why these firms are not funding the remedies independently. Feargal Sharkey, a musician and advocate for clean rivers, asserted that this announcement is “not at all cause for celebration”.
When asked why customers must bear the cost when water companies distributed £1.4 billion in dividends last year, Ms. Kelly responded to Sky’s Ian King that “the dividends have been comparatively low in relation to other sectors”.
She further stated, “In a demonstration of the gravity of the situation, all water company CEOs have collectively decided that no bonuses will be paid from customer funds this year.”
Complete eradication of sewage spills remains unattainable
The Environment Agency data shows that there were 301,091 incidents of sewage spills in England in 2022, averaging to about 824 each day.
Several recent high-visibility events, like the discharge of sewage at a scenic beach in Cornwall, have amplified public revulsion towards this problem.
Water UK has announced that the £10bn will supplement a prior commitment to invest £3.1bn, and the funds will be allocated within this decade.
This investment will support initiatives such as the expansion and enhancement of pipelines, and the construction of underground reservoirs equivalent to thousands of Olympic-sized swimming pools to accommodate excess rainwater that would otherwise overwhelm the system.
The plan aims to reduce the annual count of sewage overflows by up to 140,000, relative to the levels reported in 2020.
However, Ms. Kelly conceded that due to the antiquated design of the Victorian-era system, it will not be possible to completely eliminate sewage spills.
She explained, “If it were today, one wouldn’t design such a system, but that is what we are dealing with. Rectifying this will take some time.”
She further added, “We won’t achieve a scenario where all spills vanish, but we are set to drastically reduce the damage caused by these spills.”
