Thames Water has submitted a request to regulator Ofwat to allow it to increase bills within the current control period to cover the cost of land purchases for its new super sewer.
Some £273M is expected to be needed to acquire land to enable construction of the Thames Tideway Tunnel.
Thames also wants to up bills to cover other costs incurred because of bad debt in the economic downturn.
If approved by the regulator bills will rise by £29 in the last year of the current five year cycle in 2014/15.
However, the firm is recommending that it should be able to spread the increase over more than one year.
Although prices for 2010 to 2015 were agreed with Ofwat in 2009, this mechanism exists for exceptional circumstances.
“These significant costs could not be quantified at the beginning of the current pricing period, and their scale is unique to Thames Water’s operations, project commitments