Water Bills for 2027-28: What Your Water Company Is Expected to Explain, and the Five Companies Cleared for Extra Rises

Ofwat published its information notice for the 2027-28 charging year on 1 October 2026. Numbered IN 26/04, it sets out how the regulator expects water companies to set charges, check them and explain them to customers. It updates last year’s notice, IN 25/04.

For a household, three things in it matter: what the company should tell its customers about next year’s bill, what counts as a “significant” increase, and when the new charges are due. A separate Ofwat decision from August answers, in draft, the other question many households are asking, which is whether their company is one of five allowed to add extra amounts to bills before 2030.

What your water company should tell you

The notice says the Public Accounts Committee’s 2025 report on water regulation concluded that companies were raising bills “without explaining why, or how the money will be spent”. Ofwat’s response is a set of expectations for the main regional companies, which it calls incumbents. Each should publish and communicate, “in a manner which is effective, accessible and clear”:

• where customer money is spent;
• why bills are rising, compared both with last year and with before 1 April 2025; and
• what improvements in infrastructure the funding will deliver.

Ofwat expects that information in three places: on the company’s web pages about bills, which should be “readily found through a simple internet search”; on individual customers’ bills; and in other bill communications such as customer portals. Where a company’s charges and bills change significantly, Ofwat expects it to give customers “clear and transparent information” on what is driving the change.

A customer can also ask. Where a customer requests any of this information, the notice says the company should provide it in an accessible form, which may be spoken or written, for example in reply to a billing enquiry. Companies must send Ofwat the links to this information when they publish their charges.

The notice words these as expectations (“should”, “we expect”). It also says that where Ofwat considers a company is not complying with its charging rules, it can take “targeted and proportionate action to protect customers”.

If your bill comes from a smaller company supplying a new housing estate (a new appointee, or NAV), a parallel set applies: it should explain that it is a “last-mile” provider using the main company’s network, and say why bills are rising and what the funding pays for, or link to the main company’s explanation.

What counts as a “significant” increase

Ofwat’s charging rules define a significant change as more than 5% in household or wholesale charges compared with the previous year. Where a change passes that line, the notice says incumbent companies should explain to Ofwat the key drivers behind it, under these headings:

• inflation;
• changes in allowed revenue from the price review, or allowances from the cost change process (the notice’s examples are PFAS removal, asset health, growth, large gated schemes, major projects and Havant Thicket);
• rebalancing of charges between customer groups, and the reason for it;
• changes in consumption or customer numbers;
• outperformance or underperformance payments, including earlier ones that no longer apply;
• regulatory penalties or fines, including earlier ones that no longer apply;
• over- or under-recovery of revenue in previous years; and
• deferred revenue: money not collected in earlier years to manage bill increases, now being recovered.

That breakdown goes to Ofwat. What reaches the household is the plain-language explanation described above. New appointees do not report drivers, because their charges are set relative to the main company’s.

When next year’s charges are published

Ofwat says it has shared average bills information with Water UK, for the Discover Water website, and with CCW since 2014-15, and will do so again for 2027-28. It is also considering how reporting typical bills alongside average bills could help customers understand increases, from 2028-29 onwards.

One further point affects some households. Assessed charges are charges built on assumed rather than measured use. In September 2026 Ofwat wrote to every incumbent company asking how its assessed charges are worked out, including the consumption assumed for each band, and the notice says any company with three or fewer bands should plan to introduce more, possibly over more than one year. How metered and unmetered bills compare is on the water meter page.

Is your company one of the five?

On 13 August 2026 Ofwat published draft decisions under its Cost Change Process, a mechanism for funding work whose costs were uncertain when the 2024 price review was settled. Thirteen companies asked for a total of £4.3bn. Ofwat ruled £752m out of scope or short of evidence, rejected a further £143m, and provisionally allowed £3.390bn.

In Ofwat’s words, “Just five out of 13 companies have been allowed to recover funding via customer bills between 2027 and 2030.” Ofwat says the impact of some of the allowed spending will be deferred until the next price control period, due to start in April 2030.

How to read the table:

• The two columns are not added together. Ofwat’s example: Severn Trent’s increase is £3 in 2027-28, rising to £5 in 2029-30, “not £8 higher by 2030”. Southern’s is profiled to be lower in 2029-30 than in 2027-28.
• They are averages. Ofwat’s table heads the columns “Bill increase (£)”, and CCW describes them as the additional average bill impact. An individual household’s bill can differ.
• It shows the cost change decision only. CCW compares the amounts with the 2024 price review settlement; they are not a forecast of the whole bill.
• Check both names on your bill. Some homes get water from one company and sewerage from another, so both may be relevant.
• The figures are draft. Ofwat says some allowed spending is conditional on companies supplying more information, and the final decisions are due in December 2026.
• Not every company is listed. CCW’s response says Affinity Water and South Staffs Water made no claim in 2026, so the process adds nothing to their bills, and that Portsmouth Water’s Havant Thicket reservoir is being handled separately. CCW also treats Bristol Water as part of South West Water, which has no in-period increase.

So, of the five, South East Water’s customers see no rise from this decision in 2027-28 to the nearest pound. On the draft figures, four companies’ customers would see one in 2027-28.

Southern Water requested more than £1bn and, in Ofwat’s words, “will see the largest bill increases as a result of the Cost Change Process”. Ofwat says two-thirds of its submission related to schemes, including the Sandown Isle of Wight Water Recycling Plant and the Hastings Resilience Scheme, that were not fully included in its 2024 allowances because their costs were not certain at the time.

What CCW has said

The Consumer Council for Water (CCW), which represents water consumers, published its consultation response on 30 September 2026. It accepts that “there is a strong case for much of the investment”, but says the cost change mechanism “should not weaken the discipline of the five-year price review or make further customer bill increases routine”.

CCW singles out Southern Water’s £43 as needing “a considerably stronger affordability test” than for the other companies. It asks Ofwat to make funding at the end of the period, rather than during it, the default, and to publish a company-by-company statement for customers with the final decisions: the extra bill impact before 2030, the costs deferred beyond 2030, what customers get for the money, and what protection applies if the company does not deliver. On Thames Water, CCW notes that unused development funding for major projects will be returned to customers in full at the end of 2025-30.

What it means at home

The amounts in this piece apply from the 2027-28 charging year, and the household charges for that year are due to be published by 1 February 2027. When they are, each company should explain the rise on its bills web page, on the bill and in its portal, and a customer can ask for that explanation directly. Customers of Southern Water, Wessex Water, Severn Trent Water and Thames Water face the draft extra amounts above from 2027-28, and South East Water’s customers from later in the period, unless the final decisions in December change them.

Ofwat’s release urges anyone struggling with their bill to contact their water company straight away about the help available. It says the 2024 price review more than doubled the share of customers due to receive help with their bills, from 4% to 9%.

The government’s separate plan to lift the limit on owning water company shares does not alter any bill, as set out in the Water Pages report on that announcement. Who owns your company, and how to look up its record, is on the check it yourself page.

Read at source on 9 October 2026: Ofwat’s information notice “IN 26/04 Expectations, assurance and information requirements for water company charges for 2027-28” (1 October 2026); Ofwat’s press release “£3.4bn of funding set to unlock further improvements for water company customers, communities and the environment” (13 August 2026), including the bill impact table in its notes to editors; and CCW’s “Our response to Ofwat’s Cost Change Draft Determinations for 2026” (30 September 2026). Every figure, date and quotation above is taken from them. The bill figures are Ofwat’s draft figures for the cost change decisions alone and may change at the final determinations. Water Pages is an independent information service, not a government body or a water company.