Water bills will rise by an average of 36% over the coming five years, regulator Ofwat has announced.
In its final determination for the sector, the regulator confirmed on Thursday that prices would be hiked by the equivalent of £31 a year.
Water firms had lobbied for an average 40% increase to bills, with the rise above the 21% hike initially proposed by Ofwat earlier this year.
“We recognise it is a difficult time for many, and we are acutely aware of the impact that bill increases will have for some customers,” Ofwat chief executive David Black said.
“That is why it is vital that companies are stepping up their support for customers who struggle to pay.”
“We have robustly examined all funding requests to make sure they provide value for money and deliver real improvements while ensuring the sector can attract the levels of investment it needs to meet environmental requirements.”
The increase will come into force from April and fund some £104 billion in upgrades across the sector, according to Ofwat.
Thames Water customers will face a 35% increase in bills over the next five years, the final determination showed.
The crisis-struck water supplier had lobbied Ofwat for a 53% increase in bills as it looked to stave off renationalisation due to hefty debt levels.
Ofwat’s confirmed increase will see bills for the country's largest supplier average £588 annually, against £436 previously.
Among listed companies, Severn Trent PLC (LSE:LON:SVT) was granted a 47% increase to £583 annually, against the 46% rise it had asked for.
Pennon Group PLC (LSE:LON:PNN, OTC:PEGRY)’s South West water will be allowed to hike bills by 23% to £610, in line with the rise requested by the supplier.
United Utilities Group PLC (OTC:UUGRY) (LSE:UU.) was also granted the 32% rise it had asked for, which will take bills for the firm’s customers to £585.