Lower charges on the way for thousands of customers
Thousands of un-metered Thames Water customers will enjoy reduced annual bills for water and wastewater services from this April, following the introduction of a new tiered charging system.
The charges for over 38,000 customers, whose bills are currently based on the average metered bill, or Average Household Charge, have been reviewed to better reflect the amount of water they use.
Most properties in Thames Water's region are billed according to their rateable value (RV); around 22 per cent are metered and billed on the amount of water used. Industry research suggests that metered households tend to consume less water than un-metered properties, and can therefore shave pounds off their water bills. For those households where a meter is requested, but cannot be fitted ? for example where there is a shared water pipe (blocks of flats) ? Thames Water has charged the Average Household Charge, where it would provide a saving to the customer from the usual RV bill.
Last year Thames Water conducted a survey of all customers on this Average Household Charge to establish a fairer system. This new system, which will now be called the Assessed Household Charge, places properties in one of three bands, based on the number of bedrooms at the property.
Properties with one or two bedrooms will fall into bands 1 and 2 and will now pay less than the current charge of £245 which has been frozen for two years. With just under 24,000 properties falling into these bands, there will be savings for around 63% of customers currently on the Average Household Charge, typically those living on their own, or in small flats. Customers with properties of three bedrooms or more are expected to see a slight increase in their charges to around £266 . These represent around 30% of the total.
Customer Services Director Mike Tempest said:
"Last year we decided to review how some of our customers were charged for their water use, as it was clear that in some cases the charges didn't reflect the amount of water they actually used."
"We wanted to make our charges fairer for those customers who wanted to pay for what they used, but couldn't have a meter fitted. The drought we experienced in 2006 demonstrated that customers wanted to take responsibility for the amount of water they used, with many asking us to fit meters. And while we were able to fit many more meters than we had planned, there were customers, particularly those living in blocks of flats where it not possible for us to fit a meter."
"We know that customers want to pay for what they use. By splitting the charge into three bands, their bills will better reflect the true consumption."
"We would like to thank everyone who took part in the survey ? over 90 per cent replied and there's no doubt that this high response rate has helped us to design a system which is as fair and accurate as possible."
All customers on the Assessed Household Charge will be contacted this week by letter or email informing them which band their property falls into, with their bills arriving in April. Annual bills for other customers will be sent out later this month.
The bands, to be agreed by Ofwat, are expected to be as follows:
| Band | No. Bedrooms | 2007/08 charge | 2008/09 charge |
| 1 | Studio / 1 Bedroom | £245 | £200 |
| 2 | 2 bedrooms | £245 | £217 |
| 3 | 3 or more bedrooms | £245 | £266 |
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Customers who did not respond to the survey will have their properties moved into Band 3 by default. If this band does not reflect the size of the property, customers are asked to contact Thames Water, on 0845 9200 888, so that records can be amended and the correct band be assigned to the property.
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The AHC has been frozen for two years at £245. Although for many customers this has meant lower bills, it bears no relation to the amount of water used.
