Environment Agency lifts abstraction licence charges for water companies

Water companies will face higher abstraction licensing charges from 1 April, following the Environment Agency’s reform of its licensing charging system.

The Agency said its Water Resources Review of Charges aimed “to create a fairer system where people pay for the services they receive and those abstracting a lot of water, such as water companies, will pay more, supporting behavioural change to use water more economically”.

Under the new system, charges will be based on: the volume of water taken from the environment; where it is taken from; and how much is returned to the environment.

The Agency explained charges have not increased for ten years, despite the work and cost involved increasing in that time, leaving it not currently recovering service provision costs.

The new charging framework will secure £25m in additional income each year, which the EA said would enable further investment in:

• protecting future supplies through maintaining and operating infrastructure, including water transfer schemes, gauging stations, weirs and sluices;

• modernising the water abstraction licensing system through digital transformation; and

• protecting and enhancing the environment through a more sustainable approach to water abstraction, with increased emphasis on rare and sensitive habitats, such as England’s unique chalk streams.