The company wants to hear people’s views on the proposal as part of its consultation on its five-year-plan.
In the document it says: “One possibility (to cope with demand) is ‘wastewater recycling’.
“This process is already common practice in many parts of the world.
“It involves putting treated effluent from a sewage works through a further process which would allow the water to be returned to a river at higher than usual quality and pumped out again downstream.
“It can then be treated to drinking water standards and put back into supply, rather than lost to the sea.
“We need to carry out further research into this approach, and will be doing so over the next five years.
“Other potential solutions which we will be examining closely include a new storage reservoir and transfer schemes to bring water from other parts of the country.”
It added:“Long-term predictions suggest we will need a major new source of water by the late 2020s, and that this is an issue which also affects the wider South-East area.
“Potential solutions will take a long time to plan and implement. We therefore need to work with stakeholders, regulators and other water companies over the next five years to agree on the best course of action.”
The consultation asking customers for their opinions on all aspects of the company’s service runs until June 26.
Feedback will inform its business plan for the five years from 2015.
Thames Water’s 2015-to-2020 business plan will be submitted to Ofwat in December this year.
The regulator will examine plans from all water companies as part of its 2014 review of prices.
At the end of the price review Ofwat will confirm the amount of investment it expects each company to deliver over the next five-year period and the upper limits for customers’ bills.
Nick Fincham, Thames Water’s director of strategy and regulation, said: “We have done more research than ever before to make sure our plans reflect the needs and priorities of our customers.
“However, with more than 14 million people reliant on the service we provide, it is vital that we get as much feedback as possible on our plans.
“I would encourage all of our customers to visit our website, call the freephone number and have their say, or come and speak to us face to face in the shopping centres and high streets of London and the Thames Valley.”
Other elements in the plan include:
> Reduce leakage from around 665 million litres per day to 620 million litres, including replacing 600km (372 miles) of worn-out water mains. This builds on the 1,600 miles of pipework replaced in the past decade, cutting leakage by a third to its lowest-ever level and enabling the company to hit seven consecutive annual leakage-reduction targets.
> Install 500,000 water meters, increasing the proportion of homes with a meter from 30 per cent to 56 per cent
> Strive to achieve 100 per cent compliance with stringent UK and European drinking water quality standards
> Encourage and assist customers to use water wisely, reducing the average amount each person uses per day from 161 litres to 153 litres
> Meet all project milestones for the Thames Tideway Tunnel, due for completion in 2023
> Aim for treated effluent to be 100 per cent compliant with licence conditions at our sewage works
> Remove 2,100 homes from the risk of sewer flooding
> Aim to meet government targets to reduce carbon emissions to 34 per cent below our 1990 level
> Introduce a social tariff to help households who most struggle to pay
> Improve its IT systems to enable online account management
The consultation is available on the Thames Water website.