22 October 2008
Consumers could see their water bills rise faster than they had anticipated because water companies are struggling to secure the investment they need. According to a report in the Observer, water firms have planned to pump £27 billion into infrastructure improvements over the next five years. They submitted pricing plans to Ofwat this summer, giving details of future price rises. Much of the finance was to be raised on the debt markets, but the ongoing credit crunch has made this more expensive. As a result, water firms may turn to their customers to raise the additional funds, putting up bills at a faster rate than they had originally proposed, experts claim. A spokesman for Water UK said it is true that problems in the credit markets have made debt more expensive, but he insisted companies would do their best to keep price increases to a minimum. Meanwhile, Scottish Water has failed to meet targets on leakage reduction and improvements in drinking water quality, according to the Water Industry Commission for Scotland.
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