Thames Water customers will pay less than expected towards the £4.2 billion ‘super-sewer’ being built in London.

It was thought the Thames Tideway Tunnel would increase bills by up to £80 a year.

But now the project is expected to add between £20 and £25 to average bills.

Thames Water's five million-plus customers currently already pay £7 a year towards the tunnel.

The lower than predicted rise was revealed as the massive sewer was given its formal green light by regulator Ofwat.

Work on the 15-mile tunnel running beneath the river from Acton in the west to Abbey Mills in east London is set to start next year and be complete in 2023.

The sewer will greatly reduce the 39 million tonnes of untreated sewage that overflows into the Thames in a typical year.

The project is expected to create more than 9,000 direct and indirect jobs at the peak of construction.

Ofwat handed a licence to Bazalgette Tunnel which will build the scheme.

Thames Water chief executive Martin Baggs said strong competition for construction and financing had driven down costs on the project.

Mr Baggs added: "The really good news is that cheaper finance and other efficiencies mean that this hugely important piece of national infrastructure can be built while keeping our bills at or around their current level, before inflation, for at least the next five years."

Environment secretary Elizabeth Truss added the announcement "brings us one step closer to finally modernising London's ageing sewerage system.

"In the 21st century, the most dynamic city in the world should not have a river that is polluted by sewage every time there is heavy rainfall."