Thames Water Seeks 40% Price Hike for 1.5 Billion Pound Environmental Investment
Thames Water, the UK's water utility company, announced a new investment plan of 1.1 billion pounds ($1.4 billion) to improve its infrastructure and reduce sewage spills and leaks.
The company aims to persuade the regulator, Ofwat, to allow a 40% price increase to cover its debts and fund additional environmental projects.
Ofwat is pushing for smaller price hikes, and Thames Water suggested an alternative 1.9 billion pound investment, which would lead to a 44% price increase.
Thames Water, providing water to a quarter of the British population, faced a crisis last month when its owners refused to invest 500 million pounds.
The privatized water industry in Britain has been under scrutiny due to increased sewage spills and heavy debt and dividend payments to owners.
Public outrage over pollution and potential higher bills has pressured the regulator to ensure value for money.
However, investors demand returns, leading to a stand-off over Thames Water.
The CEO, Chris Weston, stated they would continue discussions with regulators and stakeholders.
Ofwat announced on Monday that clarifications had been made regarding the industry's statutory commitments, requiring water companies to revise their business plans.
Thames Water has since updated its plan, and Ofwat will publish its draft view on companies' plans on June 12.
Thames Water aims to use its plan as a basis to secure equity investment, as its parent company, Kemble, had previously defaulted on debt, increasing the possibility of collapse.