Anglian Water has confirmed the proposed location for a new reservoir in the Cambridgeshire Fens.
Situated north of Chatteris near the villages of Doddington and Wimblington, the reservoir will supply enough water for around 250,000 homes.
Anglian Water said it would also protect the environment by enabling a reduction in the amount of water taken from rivers and underground aquifers elsewhere in the region.
The announcement comes after one of the driest summers on record which saw many water companies implementing hosepipe bans to conserve water supplies.
The plans want to turn the area into a new visitor destination, which Anglian Water hopes will create new jobs, and wider economic, environmental, leisure and health benefits for the local community.
D,r Geoff Darch, water resources strategy manager for Anglian Water, said: "Following a thorough and multi-stage site selection process, assessing a wide range of criteria, we have now identified the best performing location for a new reservoir.
"We know the effect on those impacted by our proposals including homeowners, landowners and the nearby community because we've already been speaking to those most directly affected.
"We are committed to working with everyone as the project develops and want to hear all views on our emerging proposals.
"The new reservoir will store more water so it's always on tap when we need it, meeting the challenges of a changing climate and a growing population. It will mean less water is taken from sensitive sources, such as chalk streams, helping us to protect and restore the environment."
The reservoir is being developed in partnership with Cambridge Water and a formal public consultation period will begin on Wednesday.
Together, the two water companies have been undertaking assessments to identify potential locations for the reservoir.
This included considering impacts on people and communities, the needs of the environment, landscape, existing water sources, engineering requirements, flood protection and many other factors.
As part of the initial consultation, which will run until 21 December, a very early concept design for the reservoir has been provided to help aid thought and discussion.
It shows some of the potential features they hope to include such as wildlife areas, recreation and water sports, green infrastructure such as cycleways and renewable energy, and others.
This will be developed further as the project progresses taking account of feedback from the consultation.
Dr Darch said: "We know, that to keep taps running in the future, we'll need more water storage in our region, in the form of new reservoirs.
"Our vision for the project goes beyond just building a reservoir. We want to create a place where water, people and nature come together.
"A formal consultation process will begin on 12 October, open for 10 weeks, and we encourage communities and wider stakeholders to have their say and to help shape the development of the design of the reservoir and inform the economic, social, and environmental opportunities it could create for the local area."
Further information on the reservoirs can be found here.