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Water bills will rise more than expected over the next five years, to finance higher costs and more investment, according to the BBC.
The regulator, Ofwat, is in the process of deciding how much customer bills can be increased.
In July, Ofwat provisionally agreed to allow bills to rise by 21% above inflation over the period 2025 to 2030.
But bills are now expected to rise further after Ofwat makes its final decision at the end of the year.
Later this week the government will also announce plans which are expected to lead to the biggest overhaul of the water sector since its privatization in the late 1980s.
The aim is to protect customers from the impact of rising bills, while finding funds for the huge investments needed to cope with population growth, the impact of climate change and aging water infrastructure .
While the whole sector faces challenges, the increases proposed by Ofwat in July vary significantly from company to company.
The highest agreed increase, of 44%, was for Southern Water, and the lowest was a 6% increase for Affinity Water.
Thames Water, the UK's largest water company, was given the green light to increase its bills by 23%, but has since said it will not survive if it cannot increase its bills by 59%.
Thames shareholders refused to inject promised funds into the company earlier this year, saying it would be impossible to make any profit at the proposed bill levels.
One of the reasons why Ofwat is considering allowing larger bill increases is to reflect higher funding costs, according to the BBC.
On Wednesday, a new independent commission, chaired by a high-profile president, will be announced to advise the government on a “proper reset” of the industry to improve performance and attract new investment.
The commission's review will seek input from a wide range of stakeholders, including customers, environmental organizations, investors and engineers whose interests are not always aligned.
“Catastrophic loop”
Customers are furious about the scale of the spills and pollution, while investors say the bills they are allowed to charge are insufficient to attract the investment needed to fix the problems.
Some companies have been caught in what one executive described as a “doom loop”: underperforming companies have been fined for wastewater discharges and leaks, leaving them with even less money to fix the very problems they were fined for.
Investors were also condemned for the dividends and executive pay they paid as pollution and leaks increased.
In short, no one is happy with the current configuration.
The main regulator, Ofwat, is expected to welcome the plan to create the new commission.
However, many see this as a reflection of widespread dissatisfaction with the way the sector is regulated, with some saying Ofwat has erred between keeping customers' bills low and encouraging investments.
The new commission is not expected to report until Ofwat has made its final decision on how much bills could rise by 2030.
