Ofwat has set out new guidelines as part of its plans to open a new market for using treated sewage to generate energy.
The regulator says the rules will help water companies share common, consistent information about waste so prospective buyers can make informed decisions on the value of the product.
This information will include details about the quantity of sewage as well as its moisture content.
The treated sewage will be used to produce biogas, which can be cleaned and injected into the gas grid or used to generate low carbon electricity.
The remaining sewage material can be used in the agricultural sector as a fertiliser once it has been processed.
David Black, Ofwat Senior Director of Water 2020, said: “The idea of reusing waste to create low carbon electricity works and can deliver environmental benefits and could also result in lower bills for customers.
“Sometimes that means thinking creatively about how we can get more from all parts of the water sector – even those that might make some of us feel a little squeamish.”