Abingdon Reservoir Costs Soar to £7.5 Billion – a Wake-Up Call for Better Planning

Thames Water has revealed that costs for the controversial proposed Abingdon Reservoir have soared from £2.2 billion to between £5.5 billion and £7.5 billion, a tripling of the original figure. This startling increase will fall largely on bill-payers across the region.

Thames Water attributes the sharp rise to new geological and hydrological investigations, which revealed much more complex conditions than earlier anticipated – something which the Group Against Reservoir Development (GARD) and CPRE Oxfordshire have been warning about for some time.

Around half of the final cost will be passed on to Thames Water’s 16 million customers across London and the South-East while customers of Affinity Water and Southern Water are expected to shoulder the rest.

This comes on top of already soaring bills: Thames Water customers face a projected bill increase of 35% over the next five years; Affinity customers 26%, and Southern Water customers a staggering 53%. Due to the Ofwat funding regime, the reservoir will add to these increases from the moment construction starts in 2030, at least 10 years before any water is pumped into it.

Approval for the Abingdon Reservoir was fast-tracked by the Secretary of State as a Nationally Significant Infrastructure Project (NSIP), despite the Environment Agency advising that the project should not go ahead due to “outstanding concerns regarding costs, justification and options appraisal”.

Thames Water is already under heavy financial strain, carrying around £20 billion in debt and facing potential collapse after private equity firm KKR recently abandoned a planned bailout, whilst also having to pay a record fine of £122.7m for breaching rules over sewage spills and shareholder payouts.

As CPRE Oxfordshire, we are deeply troubled by the astronomical cost escalation and the looming burden on bill-payers and local communities – especially when there are safer, cheaper and quicker alternatives (such as repair of leaking infrastructure, better water reuse systems and water transfer schemes) which won’t put such a huge burden on community and countryside.

Earlier this year, we joined Oxfordshire campaign company SAFERWaterS in the High Court to demand a public inquiry and to argue for more sustainable and cost-effective alternatives. Unfortunately the Judicial Review didn’t land in our favour, but these escalating costs only amplify our concerns and raise serious questions about:

• Value for money — Are taxpayers and customers getting fair returns for their investment?
• Transparency and accountability — Why were these risks not identified earlier?
• Alternatives — Could investment in leakage reduction, water transfers, or recycling yield better results at lower cost?

The spike in Abingdon Reservoir costs is more than just a financial concern — it’s a signal that the current approach to securing future water supply may be misguided, inefficient, and unsustainable, and highlights concerns that Thames Water is not in a fit state to take on such a huge infrastructure project.

We reaffirm our call to Thames Water and policymakers to: reassess the project in light of updated costs and paused financial frameworks; explore and prioritise low-impact, cost-effective alternatives and ensure full transparency and public engagement before proceeding with development.

The petition to call for a public inquiry is still open, so if you haven’t yet added your name, please sign and share.