How non-household customers are charged

Non-households are usually charged for water and sewerage services on the basis of the amount of water they use, and the amount of wastewater and trade effluent they discard.

Water

If you have a meter you will pay for your water through a standing charge (which depends on the size of your meter) and a volumetric rate. For smaller non-households, the volumetric rate is the same as that for households.

If you do not have a water meter you will be charged in the same way as unmetered household customers. Your bill is not based on how much water you use but is usually made up of a fixed charge (the ‘standing charge’) and a charge related to the rateable value of your property. The fixed charge covers things like billing and customer service costs.

Standard non-household charges for water | Large and intermediate users | Charges for non-potable water

Sewerage

Sewerage services have four main activities, which are for collecting and treating:

  • foul sewage
  • surface water drainage
  • highway drainage
  • trade effluent

Charges for foul sewage and trade effluent are based on the amount (and strength for trade effluent) discharged. Companies currently have different approaches to charging for surface water drainage and highway drainage.

If you can demonstrate that you do not receive any of these services apart from highway drainage you should be entitled to a reduction in charges.

Sewerage charges | Trade effluent charges

Other charges

You can be charged for other services that water or sewerage companies supply, including charges for connection and reconnection.

Infrastructure charges | Non-standard charges | Self-lay and connection charges

How your charges are regulated

Charges for customers who use less than 50 Ml (250 Ml in Wales) are subject to price limits, which we set.

Charges for customers who use more than 50 Ml water (250 Ml in Wales) are not subject to price limits. However, the difference between charges for large users and households must be neither unduly preferential nor discriminatory to large-users.

Customers in eligible premises can choose to purchase water from either their existing water supplier, or from one of a number of water supply licensees. Find out more about arrangements for competition.

Water and sewerage charges change every year. So, your bill will change from one year to the next. The level of your bill and how much it changes from year to year depends on which company supplies your water and sewerage services. Each company faces different challenges in delivering services to consumers. This means that costs and charges will vary from company to company but we check that charges are fair and are within the price limits we set.You can find about about average bills since privatisation.For specific details of your charges, you should contact your water company.You can also find out:

Large and intermediate users

If you use more than a specified amount of water, you may be able to opt for a large or intermediate tariff, instead of paying the standard charges. These tariffs generally consist of a:

  • standing charge
  • a volumetric rate

Some of these tariffs have an additional fixed charge and a lower volumetric rate for water used. Some have a lower volumetric rate for all consumption above a certain threshold, with no additional fixed charge. These tariff structures minimise the incentives for you to use more water just to qualify for the tariff.

Alternative tariffs

Some water companies offer alternative tariffs to large and intermediate consumers. Your can find out more in your company’s charges scheme.

Seasonal tariffs

If you use less water in the summer than in the winter then you may benefit from a seasonal tariff. Seasonal tariffs have a volumetric rate that is higher in the summer than in the winter.  Companies can apply seasonal tariffs if they read your meter at appropriate intervals. It is not necessary for you to have a ‘smart’ meter.

Subscribed demand tariffs

If you are able to forecast your maximum daily demand for water, you may benefit from opting for a subscribed demand tariffs. These tariffs provide customers with a strong incentive to manage their peak demands.

If you opt for this type of tariff you need to notify your water company of your likely maximum daily demand before the start of the charging year. A subscribed demand tariff usually consists of:

  • an annual maximum demand charge (in £ per megalitre per day), which is based on your maximum daily demand
  • a usage rate (pence per cubic metre), which is applied to the amount of water you use each day up to amount that you have notified as your maximum daily demand
  • a penalty rate (pence per cubic metre), which is applied to any water you use in a day which is above your notified maximum daily demand

You can talk to your supplier about likely future demand. The companies have found this dialogue with large users about water use and the potential for water conservation useful.

Interruptible tariffs

Interruptible tariffs allow you to take the risk of occasional interruptions to your water supply in exchange for lower water charges. You need to be capable of managing interruptions to your supply.

We have agreed operating rules with the companies that offer this tariff to make sure that customers on an interruptible tariff can manage interruptions to their water supply. For example, we encourage the companies to conduct at least one test interruption for each customer every year.

Reserved capacity charges for standby supplies

If you have access to your own supplies of water, such as from a borehole or an onsite effluent treatment plant, you may only require water as a back-up if your own supplies fail.

Generally water companies charge for stand-by supplies as follows:

  • a volume-related charge (pence per m3), that applies to the volume of water reserved by customers over the whole year (possibly split between peak and off-peak seasons); or
  • a specific reserved capacity charge (£ per megalitre per day), based on your maximum daily demand

Customers who require back-up supplies will have particular cost characteristics and may require a dedicated suite of reserved capacity or stand by charges.

Charges for non-potable water

For most household customers, all water supplied is of drinking water quality, this is called ‘potable water’. Water that is not drinking water quality is called ‘non-potable water’. Some water companies supply non-potable water to industrial customers as well as potable water.

Non-potable water is usually charged for in the same way as potable water but generally the volumetric charge for non-potable water is lower because it does not include the cost of treating the water to drinking water standard.

For more information about non-potable water, contact your water company.

Non-standard charges

Many companies include some non-standard charges in their approved charges schemes. These miscellaneous charges cover services that companies may provide, but which are not included in the tariff basket. Examples include:

  • charges for reconnection
  • non-household meter installations
  • meter testing
  • hydrant installation
  • standpipe hire

We do not formally regulate these charges, but we monitor them to make sure that they broadly reflect costs. We may challenge a company if we receive a complaint about them from a customer.

Sewerage charges

There are four types of activity that attract sewerage charges. These are for collecting and treating

  • foul sewage
  • surface water drainage, which occurs when rainwater falls on a property and drains away
  • highway drainage, which occurs when water runs off roads and pavements
  • trade effluent

If you are able to demonstrate that you do not receive any of these services apart from highway drainage you should be entitled to lower charges.

Charges are generally based on the cost of collecting and treating the different types of sewage. The amount of sewage that is generated by a property may be either measured or estimated. For some companies, the different components are combined for billing purposes.

Foul sewage for small and intermediate users

If you use less than 50 Ml of water a year (250 Ml in Wales) you would usually pay the standard non-household charges for foul sewerage. These are subject to price limits that we set.

Metered customers

Almost all non-household customers have a water meter, and this is used to estimate the amount of foul sewage generated. If you have a water meter your foul sewerage charges are worked out using:

  • a volumetric rate which is multiplied by
  • the volume of water used, adjusted for the water that does not return to the sewers

Most companies also charge a standing charge. The level of this charge depends on the size of your water meter.

The volumetric rate for metered non-households is usually the same as the volumetric rate for metered households.

Anglian Water, Southern Water, Thames Water and Wessex Water’s charges for non-household sewerage standing charges are higher than average. This is because these companies include the costs of both surface water and highway drainage in the sewerage standing charge. Dwr Cymru’s standing charges for non-household sewerage are also higher than average, because it includes a highway drainage charge.

Unmetered customers

Unmetered non-household customers are charged for foul sewerage in the same way that unmetered household customers are charged. If you do not have a meter you will usually pay:

  • a fixed charge, which includes the customer-related costs of supply
  • a charge related to the rateable value of the property

Unmetered customers’ charges are based on the rateable value of the property under the 1973 Valuation Act. The Valuation Office Agency gives all non-households in England and Wales a rateable value. The rateable value is a professional assessment of the annual rental value of a property on a specific date. The values are updated every five years.

The charges are outlined in the household customer information section.

Large user tariffs for foul sewage

Water and sewerage companies offer separate foul sewerage tariffs that apply only to large or intermediate users. These generally consist of:

  • a fixed charge (which may be bigger for higher discharge thresholds)
  • a standard volumetric rate for foul sewage discharged up to the threshold value for the tariff
  • a lower than standard volumetric rate for foul sewage discharged over the threshold value for the tariff

The amount of foul sewage discharged is estimated from the amount of water used, less an allowance for water that does not return to the sewer.

A customer is considered a large or intermediate user by their water company if they are likely to use more water than a threshold value. This value varies from company to company. However, all customers who are likely to use more than 50 Ml (250 Ml in Wales) are considered large customers.

The principles that each company should apply when setting large user tariffs for water should also apply when it sets large user tariffs for foul sewage or trade effluent. Companies typically justify their large user tariffs for foul sewage or trade effluent on the basis that they use the reception and conveyance part of the service less.

For further information about foul sewerage charges for large or intermediate users you should contact your water company.

Further information

Find out more about:

Standard non-household charges for water

Non-household customers who use less than 50 Ml of water a year (250 Ml in Wales) usually pay the standard non-household charges for water. These are subject to the price limits that we set.

Metered customers

Nearly all non-household customers have a water meter. If you have a meter you will usually pay for your water through:

  • a standing charge
  • a volumetric charge which is applied to the volume of water used

The standing charge is fixed. It covers the costs to the company of reading and maintaining your water meter. The volumetric charge varies depending on how much water you use.

Your current charges can be found in your company’s charges scheme.

Example

Company A uses 700m3 (0.7Ml) of water a year, and has a 40mm water meter.

Its water company has a fixed charge of £200 for a 40mm water meter, and charges £0.8/m3.

Company A is charged:

Fixed charge + (water used x volumetric rate) = £200 + (700 x £0.8) = £760

The standing charge usually depends on the size of your water meter.

The volumetric rate for metered non-households is usually the same as the volumetric rate for metered households. However, Anglian Water has separate charges for its non-household customers.

Unmetered customers

If you do not have a meter, you will usually be charged for your water in the same way that unmetered household customers are charged. You will usually pay:

  • a fixed charge, which includes the customer-related costs of supply
  • a charge related to the rateable value of your property

Unmetered customers’ charges are based on the rateable value of the property under the 1973 Valuation Act. The Valuation Office Agency gives all business and non-domestic property in England and Wales a rateable value. The rateable value is a professional assessment of the annual rental value of a property on a specific date. The values are updated every five years.

Your current charges can be found in your company’s charges scheme.

Trade effluent charges

The cost of collecting, treating and disposing of trade effluent depends on the volume of effluent discharged and the strength of the wastewater. Companies assess the volume and strength of trade effluent before it enters the sewers.

Calculating charges for trade effluent

Charges are based on the Mogden formula. This takes into account the following costs (as relevant):

  • collection
  • primary treatment
  • biological treatment
  • treatment and disposal into the sea
  • biological oxidation of settled sewage
  • treatment and disposal of primary sludge

The formula takes into account the level of treatment needed for trade effluent from a particular customer. This means that customers pay less for wastewater that is cleaner, and so easier to treat.

As each company calculates the average costs for its region, charges do not reflect the costs incurred at any one treatment works. Companies may reduce the collection charge for customers who discharge directly to the treatment works.

United Utilities offers, on an optional basis, a reservation charge for trade effluent customers. The charge comprises a:

  • fixed element to reflect the cost of infrastructure capacity you reserve, based on the volume and loads specified in your consent and agreement; and
  • variable element based on the actual flow and loads discharged from your premises.

Mogden formula

Charges for trade effluent are based on the Mogden formula, which is

Charge per unit of effluent = R + [(V + Bv) or M] + B(Ot/Os) + S(St/Ss)7

where

R = reception and conveyance charge [p/m3]

V = primary treatment (volumetric) charge [p/m3]

Bv = additional volume charge if there is biological treatment [p/m3]

M = treatment and disposal charge where effluent goes to sea outfall [p/m3]

B = biological oxidation of settled sewage charge [p/kg]

Ot = Chemical oxygen demand (COD) of effluent after one hour quiescent settlement at ph 7

Os = Chemical oxygen demand (COD) of crude sewage one hour quiescent settlement

S = treatment and disposal of primary sewage sludge charge [p/kg]

St = total suspended solids of effluent at ph 7 [mg/litre]

Ss = total suspended solids of crude sewage [mg/litre]

Disconnection for non-payment

If you are a non-household customer and you do not pay your water bill, your water company can disconnect you. However, this is not the case if the property is classed as mixed-use premises.

If you are having problems paying your bill you should contact your water company as soon as possible.

Mixed-use premises

Mixed-use premises have a shared supply of water and are occupied by a household consumer as their only or main home, but are also used for non-household purposes. For example, premises that include a caretaker’s flat within an office block, or a pub with residential quarters would be classed as mixed-use premises.

The law on mixed-use premises is not clear. Our view (based on the Water Industry Act 1991) is that water companies cannot disconnect mixed-use premises if customers don’t pay their bills. This point cannot finally be decided until the law is clarified either through a legal case and ruling, or further legislation.

Our view was set out to water companies in RD14/04 ‘Disconnection of mixed-use premises for non-payment of water charges – guidance to water companies’ August 2004.