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Since the Environment Agency introduced its revised abstraction charging scheme in April 2022, businesses have had greater financial incentives to use water more efficiently. Four years on, the charging framework remains in place and continues to encourage high-volume abstractors to reduce demand, improve water efficiency and invest in water reuse technologies.
Here, we explain how abstraction charges work, why sustainable water management has never been more important, and how businesses can reduce both their environmental impact and operating costs through water reuse.
What is Water Abstraction?
Water abstraction refers to the removal of water from its source, either permanently or with the intention of allowing the supply to replenish naturally. Water can be abstracted from surface water sources such as rivers, streams and canals, or from groundwater aquifers.
While abstraction is essential for many industrial and commercial operations, excessive abstraction can place pressure on aquatic habitats and surrounding ecosystems. As demand for water continues to grow and climate pressures increase, ensuring water is used efficiently has become an increasingly important environmental priority.
Who are the Environment Agency?
The Environment Agency plays a crucial role in protecting and improving the environment in England. Among its many responsibilities is the management of the country's water resources, assessing abstraction licence applications, monitoring water availability and ensuring abstraction remains environmentally sustainable.
The current Environment Agency Charging Scheme, introduced in April 2022 and updated through amendments published in May 2026, continues to recover the costs of regulating England's water resources while supporting the long-term protection of rivers, groundwater and the wider environment. The scheme applies to abstraction licensing and associated regulatory activities carried out by the Environment Agency.
What are the Current Abstraction Charges?
The Environment Agency's charging framework remains based on recovering the costs of managing England's water resources in a fair and proportionate way. The scheme is designed so that licence holders contribute towards the regulatory work required to assess applications, monitor abstraction activities and protect the environment.
For businesses holding abstraction licences, charges are influenced by several factors, including:
- The volume of water taken from the environment
- Where the water is abstracted from
- The volume of water returned to the environment
- The level of regulatory assessment and ongoing management required for the licence
This approach helps ensure that businesses with larger or more complex abstractions contribute appropriately towards the cost of sustainably managing the nation's water resources.
Looking ahead, the Environment Agency has also confirmed that from April 2027, charges may be increased annually in line with the Consumer Prices Index (CPI), providing a more predictable approach to future charging updates.
Businesses must hold an abstraction licence when abstracting more than 20 cubic metres of water per day from rivers, streams, canals or groundwater, making it increasingly important to understand how abstraction volumes can affect long-term operating costs.
In addition to ongoing abstraction charges, businesses may also incur fees for licence applications, variations and other regulatory activities. With these costs all contributing to the overall cost of water management, investing in technologies that reduce dependence on freshwater abstraction can deliver long-term financial as well as environmental benefits.
How to Reduce Abstraction Charges?
Thanks to advances in water recycling technologies, wastewater is now recognised as a valuable recoverable resource. Water reuse has become an increasingly important strategy for businesses across all sectors looking to improve resilience, reduce operating costs and support sustainability goals, particularly industrial facilities with high water demands. By recovering and reusing treated process water, businesses can significantly reduce their reliance on freshwater abstraction while improving overall water efficiency.
There are several treatment processes and technologies available to achieve water reuse, often combined to meet the specific requirements of an individual facility. These include:
- Biological and physicochemical treatment
- Clarification
- Gravity and/or membrane filtration
- Evaporation
- Disinfection
At Veolia, we are ideally positioned as a wastewater treatment specialist with the expertise and technologies to design tailored water reuse systems that meet each customer's operational requirements while complying with all applicable regulations.
How water reuse technology is improving industrial water management
By integrating established water reuse processes with advanced treatment technologies such as reverse osmosis (RO), ultrafiltration and nanofiltration, we deliver scalable solutions that help organisations reduce freshwater abstraction, improve water resilience and recover more value from their wastewater.
One of the latest innovations within our portfolio is CaptuRO*. Specifically developed to maximise water recovery from industrial, brackish and wastewater sources, CaptuRO uses a semi-batch reverse osmosis process that enables significantly higher recovery rates than conventional RO while minimising membrane scaling and fouling. Depending on the application, the technology can achieve water recovery rates of up to 98%, reduce brine volumes by 50–75% and lower energy consumption by up to 35%, helping businesses reduce operating costs while lessening their reliance on increasingly scarce freshwater resources.
Case Study
The technology has already been successfully implemented at Limelco, a dairy producer in Belgium, where CaptuRO forms part of a new wastewater treatment and reuse system designed to accommodate increased production while reducing environmental impact. By enabling treated effluent to be reused within the production process, the solution helps the site reduce freshwater demand, lower discharge costs and maintain compliance with increasingly stringent environmental standards.
This example demonstrates how investing in advanced water reuse technologies can deliver long-term operational and environmental benefits. As businesses continue to face increasing pressure to improve resource efficiency, reduce operating costs and strengthen resilience against water scarcity, innovative solutions such as CaptuRO provide a practical way to reduce freshwater abstraction while supporting wider sustainability objectives.
Read the full case study here.
As pressure on England's water resources continues to grow, businesses that invest in water reuse technologies today will be better placed to manage future abstraction costs, improve sustainability performance and strengthen operational resilience.
At Veolia, we work with organisations across a wide range of industries to design and implement bespoke water treatment and reuse solutions that reduce freshwater demand without compromising operational performance.
Regulatory sources: Information relating to abstraction licensing and charging has been compiled from the Environment Agency's Environmental Permitting and Abstraction Licensing (England) Charging Scheme 2022 (Version 1.9, incorporating amendments up to 15 May 2026) together with the official GOV.UK guidance. Check if you need a licence to abstract water.
*Trademark of Veolia; may be registered in one or more countries.
