The move, announced this week, follows a similar deal offered to staff by energy supplier Powergen in June.
Both schemes take advantage of tax incentives aimed at increasing PC ownership and Internet use. Private use of company computers is tax-free, as long as the benefit in kind is less than £500.
Severn Trent, the UK's second largest water utility, will subsidise about half the cost of a Hewlett-Packard Pavilion desktop and printer, running Microsoft's Windows XP. Staff must pay the remainder in £12 instalments.
Brian Duckworth, managing director at Severn Trent Water, said the company wants to be fully Web-enabled and improve staff IT skills.
"Technology plays an ever greater part in how we manage our day-to-day work. We must help employees with that transition," he said.