The increase in charges from April 2016 will help to pay for a £3.5 billion investment programme through to 2021, which the company claims will improve drinking water quality, modernise water treatment works and build a waste water tunnel in Glasgow to reduce flooding from the river Clyde.
Scottish Water charges are within price limits set by the Water Industry Commission (Wics) as part of a six year agreement.
In the first three years of the price control period, from 2015-18, Scottish Water household charges can increase by 1.6 per cent each year, irrespective of inflation. Overall, in the six year period, Scottish Water charges must increase by no more than 1.8 per cent below the Consumer Prices Index (CPI) rate of inflation.
This limited rise will mean that the average household charge for a customer of Scottish Water will total £351 in 2016/17 whilst charges for the same period in England and Wales currently stand at around £385.
Scottish Water customers can expect to pay around £6 per year more – one of the lowest rates in Britain.
Chief executive Douglas Millican, said: “Customers are at the heart of our business and they expect us to build on the significant improvements we’ve made to water services while providing stability and certainty in charge levels.
“Charges allow us to maintain investment – ensuring we continue to provide fresh, clearer drinking water for our customers, while protecting and enhancing the environment and supporting the Scottish economy.
Scottish Water bills have fallen by 10 per cent in real terms since 2009 and by the end of its current six-year regulatory period, household charges are expected to decrease further, according to Scottish Water. Millican added that this was “good news for customers the length and breadth of Scotland.”