Woman checking factory machinery

Case study Affinity Water

Providing clean water for southern England

Affinity Water is the UK’s largest water-only company, serving 1.4 million homes and 78,000 non-household connections in three separate regions in the south of England.


A group of funds advised and managed by InfraRed, alongside other co-shareholders, acquired 100% of Affinity Water in 2017. Its supply area spans 4,515km2 and its assets include 95 water treatment works, more than 100 reservoirs, and over 16,500km of pipes*. Affinity is a water-only company, without scope for processing sewerage.  

Its revenues are determined by Ofwat every five years according to a well-established incentive regulation regime, which also provides a return on incremental investment into the Regulated Capital Value (RCV). The investment provides strong correlation to inflation, as both revenues and RCV are linked to a blend of RPI and CPIH.  

Affinity Water benefits from significant RCV growth, driven by the requirement for investment to support a growing population, environmental improvements, and the need to develop new water resources. In turn, these increases in RCV also expands the revenue base. Under the current five-year regulatory period to March 2025, RCV will increase by c.25% in real terms** 

Affinity Water successfully disposed of its retail business in 2020 following liberalisation of that market, allowing it to focus on its core activities. 

  • Initial Investment


  • Theme

    Social and Transport Infrastructure

  • Strategy

    Core Infrastructure

  • Country


Affinity Water Key statistics

  • 1.4m

    households covered

  • 3.6m

    people served

  • 95

    treatment works

  • 100+


  • 16.5K km


  • 4.5K km²

    supply area


Our management of Affinity Water is a good example of how we align our commercial and sustainability objectives through our portfolio companies – driving innovation and change that creates long-term value for customers, society, and the environment.

Save Our Streams, 2022

Save our Streams initiative

The chalk streams in Affinity Water’s territory provide an excellent source of clean water – but they also foster a rare and unique ecosystem, found almost exclusively in southern and eastern England. To protect these chalk streams, Affinity Water launched an award-winning public engagement campaign in 2022 – ‘Save Our Streams’.

Backed by celebrity influencers like Ben Fogle, Sandi Totsvig, and Mark Watson – the campaign encouraged people to reduce their water consumption and protect the natural beauty where they live. The successful campaign saw Affinity Water win its latest Ofwat Innovation Award.

The campaign is helping to reduce water consumption, which carries a financial incentive from Ofwat, and helps mitigate the upward pressure on consumption as people in the region work from home more, rather than commute into London every day.
It builds on previous successful campaigns focused on restoring seagrass in Essex and Suffolk and deploying innovative technology to link small, unconnected storage assets together with centralised control systems and reservoirs – building greater water supply security.

These initiatives are examples of the company’s Water Resource Management Plan in action. This 60-year plan prioritises water supply solutions that source water from rivers and canals, instead of water from chalk catchments.

* Data from Affinity Water – https://www.affinitywater.co.uk/retailers/about-us 

** Based on internal calculations from the data within the following document – https://www.ofwat.gov.uk/wp-content/uploads/2019/12/PR19-final-determinations-Affinity-Water-final-determination.pdf 

Further reading