Two thousand households in rural Gloucestershire face a big increase in their sewerage charges.
It is claimed some bills have risen by more than 100% after it was discovered customers were paying the wrong water company for their service.
Customers in the Forest of Dean were being billed by Severn Trent instead of Welsh Water, which has higher charges.
A number of residents have refused to pay the increase and are asking Ofwat to intervene.
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We think Welsh Water should have introduced these increases far more gradually
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"My bill is going up from £83.76 to £215.27 a year and mine is modest compared with others," said Jim Hewitt from Tutshill.
"It's causing maximum distress to people, many of whom are pensioners, and it's making them very ill."
Customers were warned by letter a year ago that they were being billed by the wrong company, and that their bills would increase.
Until now, customers believed they were received their supply from Severn Trent Water and paid their sewerage charges to the firm accordingly.
But it has since transpired that Welsh Water had been incurring the costs of the treatment.
Estuary area
Simon Cotton, of Welsh Water, said: "Our bills are higher than Severn Trent's because we serve a large coastal and estuary area which Severn Trent doesn't.
"Legislation from Europe requires us to improve the standard of the sewerage system to make savings and to make the estuary, rivers and beaches cleaner which has been successful but very expensive."
Clive Sterl, from Ofwat's consumer arm, Water Voice, said: "We think Welsh Water should have introduced these increases far more gradually."
Welsh Water has refused to phase in the increase but it has also waived its right to demand back charges.