This is a review of water companies’ environmental incentives, such as charging discounts to support more water efficient new homes. We also highlight a range of approaches that water companies use to encourage better environmental outcomes. We have conducted this review to strengthen their use and effectiveness and to inform how environmental incentives should be regulated from April 2025. In the first two sections of this report we set out why we are undertaking this review and why environmental incentives are important. Section 4 sets out the results of our review of the current environmental incentives for developer services. The rest of the report provides examples of good practice in developer services as well as examples from other types of charges in the water and wastewater sectors.