Water prices capped

Ofwat has published draft proposals for the prices UK water and sewerage companies can charge their customers between 2010 and 2015. Its proposals will see household bills remaining broadly stable until 2015.

Every five years, Ofwat sets limits on the prices water and sewerage companies in England and Wales can charge customers. Its draft proposals follow the submission of water companies' final business plans in April.

The regulator's scrutiny of companies' business plans will see the average household water and sewerage bill reduced by around four per cent, or £14 to £330, by 2015.

According to Ofwat, water companies will still be able to invest extensively. Almost £21bn will be pumped into helping maintain and improve services to consumers.

Flooding in 2007 highlighted the risk extreme weather conditions pose to water supplies. The proposed investment will see this risk reduced for around 10 million people.

More than £4bn will be invested in maintaining and improving drinking water quality, as well as protecting the environment. This will help deliver cleaner wetlands, rivers and beaches.