Thames Water, Yorkshire Water, and Northumbrian Water, United Kingdom are facing a combined £168 million in fines from the industry regulator, Ofwat, due to historic sewage spills. This proposal, now open to public consultation, is part of Ofwat’s largest investigation into water company performance.
The announcement comes amidst increasing public dissatisfaction with the environmental and financial practices of these water companies, especially after sewage spills into England’s rivers and seas more than doubled last year.
Ofwat’s Chief Executive, David Black, stated, “Ofwat has uncovered a catalogue of failure by Thames Water, Yorkshire Water, and Northumbrian Water in how they ran their sewage works, resulting in excessive spills from storm overflows. Our investigation has shown how they routinely released sewage into our rivers and seas, rather than ensuring this only happens in exceptional circumstances as the law intends.”
The regulator’s investigation found that the companies failed to adequately invest in and maintain their networks, leading to repeated releases of raw sewage, which poses significant environmental and health risks.
In December 2023, Ofwat notified the companies of its provisional findings, allowing them to provide further evidence. On Tuesday, Ofwat proposed fines of £104 million for Thames Water, £47 million for Yorkshire Water, and £17 million for Northumbrian Water. Thames Water’s proposed fine is 9% of its annual sales, reflecting the severity of the offences.
In response, a Yorkshire Water spokesperson commented, “We are disappointed with Ofwat’s response to their investigation into our wastewater treatment networks. Since the start of this process in November 2021, we have co-operated fully with the investigation and we will continue to seek clarity. We and our customers care deeply about river health and we want to provide reassurance that we have already taken considerable action to improve.”
The BBC has contacted Thames Water and Northumbrian Water for comment.
Ofwat is also investigating a further eight water and wastewater companies in England and Wales, with updates expected in the coming year. Water companies have proposed raising customer bills by over 44% in the next five years to fund infrastructure improvements. Thames Water requested an increase of £191 over five years, but Ofwat approved only £99.
Public frustration has grown over insufficient investment from customer bills into upgrades. Environmental campaigners have called for a ban on executive bonuses and a review of shareholder payouts if there is evidence of environmental damage. The government is consulting on plans to ensure funds earmarked for upgrades are not used for salaries or dividends.
Environment Secretary Steve Reed stated, “I welcome Ofwat’s action today. The unacceptable destruction of our waterways should never have been allowed – and it is right that those responsible for illegally polluting our rivers, lakes, and seas face the consequences. This Government will fundamentally reform the water sector.”
Thames Water, struggling with £14.7 billion in debt, announced last month it only has enough cash to fund operations until May 2025 and risks having its credit rating downgraded. Ofwat’s David Black emphasized the regulator’s authority to impose fines and collect them, warning companies of the consequences of defaulting on their obligations.
