Water firm United Utilities faces a compensation bill of at least £15 million to Lancashire households affected by the outbreak of a parasitic bug in supplies.
The company said that cheques for payments ranging from £50 to £60 were starting to be sent out to 300,000 households.
Homes and businesses in parts of the county were first warned to boil their water before use on August 6 after traces of the microbial parasite cryptosporidium was found in a water treatment works in Preston.
Two-thirds of the affected customers now no longer need to boil water for drinking, brushing teeth and food preparation, with the company expecting the water supply to return to normal for the "vast majority" of remaining customers by the weekend.
On a Q&A update on its website, United Utilities confirmed that payments had been set following discussions with the Consumer Council for Water.
The firm said: "We are making proactive compensation payments to each household affected by this incident which is intended to recognise the additional electricity you may have used, and provide a goodwill gesture payment for both the inconvenience we've caused and the water service you should have received from us."
It added: "There will be no increase in your water charges as a result of the compensation associated with this incident. The company will bear the cost."
Business customers were advised to submit evidence and details in writing of claims for any additional losses suffered.