United Utilities has been issued drought permits which would allow it to take additional water from boreholes and reservoirs in the North West to maintain supplies.
The Environment Agency said the drought permits have been issued in case they are needed later in the year to secure water supplies for people in the region.
They allow the water company to take additional water from Windermere and Scales boreholes in Cumbria, and Delph and Rivington reservoirs in Lancashire.
If the drought permits are used before the end of September, United Utilities will be required to introduce a hosepipe ban to reduce demand for water.
The water firm had planned to bring in a hosepipe ban in early August in the face of ongoing dry conditions, but announced that the need for restrictions had been averted.
Water levels in the north west of England have slightly improved due to recent rainfall and efforts to conserve water, but it has only received around half of the rainfall normally expected during May to July, the Environment Agency said.
The agency warned current forecasts also suggest there may be continued lower-than-average rainfall into autumn.
The permits are ready to be implemented if they are needed to ensure water supplies are maintained and the environment is protected.
Jim Ratcliffe, Environment Agency drought manager, said: “The Environment Agency uses regulatory powers to manage water availability to maintain essential supplies for people and the environment and will always balance the needs of the public, industry, farmers and the environment.
“As the dry weather is set to continue into autumn, there could still be restrictions later in the summer so we continue to urge everyone to use water wisely.
“Our staff will continue to manage demand by working with farmers, businesses and others who abstract water.
“We continue to work with water companies across the country to ensure they are following robust drought plans.”