UK water regulator approves £3.4bn funding package for PFAS and data centre infrastructure

OFWAT has provisionally approved a £3.4bn investment package for several projects led by water companies to improve and safeguard the UK’s infrastructure.

United Utilities and Wessex Water are among the 13 water companies that will have funding to build out their water systems.

Namely these companies will be expanding water infrastructure for data centres in East Manchester, and improving water treatment to reduce PFAS contamination respectively.

This fresh funding comes amid growing concerns over the UK’s future water supply, coming off this summer of record-breaking high temperatures and drought. A recent report from the Environment Agency found that England risks losing 5bn l/d of public water by 2050 to climate change, overpopulation and growing energy demand.

In response, the government said it has secured £104bn in private sector spending in water company infrastructure over the next five years.

Ofwat’s commitment is part of its new cost change process, which will allow water and wastewater treatment companies to access additional funding for priority areas.

The investments were determined through a proposal process, where companies had initially requested sums totalling £4.3bn, with Ofwat allowing around 96%.

Helen Campbell, executive director for delivery at Ofwat, said: “Our 2024 price review decisions are already enabling a £104bn programme of investment to produce better outcomes for customers, communities and the environment.

“The cost change process strengthens the ability of companies to deliver without delay. The newly agreed funding will help unlock much-needed new housing development and boost business growth across a range of sectors, as well as improving drinking water quality and the removal of PFAS and forever chemicals.”

Now Ofwat will facilitate a period of public consultation, with agreement on the investment to be expected in December.