- The £44.7m package will reduce spills at specific overflows and improve river water quality in extremely sensitive catchments with the money being funded by the company, rather than added to customer bills.
- Dŵr Cymru Welsh Water is also required to rectify all identified breaches and ensure its future compliance.
- Ofwat has closed seven cases in its sector-wide wastewater investigation, bringing the total of resulting enforcement packages and fines to more than £300m.
Ofwat has confirmed its final decision to formally accept a £44.7m enforceable package of undertakings from Dŵr Cymru Welsh Water. This closes the seventh case in its sector-wide wastewater investigation and takes the total of resulting enforcement packages and fines across the sector to more than £300m.
Ofwat previously announced on 12 March that the company had failed to operate, maintain and upgrade its wastewater treatment works and networks adequately to ensure that they could cope with the flows of sewage and wastewater. A consultation period followed where customers and stakeholders provided feedback on the provisional decision.
Having assessed all the responses received, Ofwat has formally accepted the enforcement package which includes redress to customers and the environment including:
- £40.6m to address harm and reduce spills at specific overflows. The company will also investigate and carry out sealing works on private parts of the sewer network to tackle groundwater infiltration, which is a significant contributor to frequently spilling overflows.
- An additional £4.1m will be invested to improve water quality and biodiversity in extremely sensitive catchments.
Lynn Parker, Senior Director for Enforcement at Ofwat, said:
“Our investigation found serious and unacceptable breaches in how Dŵr Cymru Welsh Water has operated its wastewater assets which has resulted in excessive spills to the environment.
“With this investigation now concluded, we expect the company to focus on putting things right so that customers can regain trust in their water company. We are playing our part in holding companies to account with this announcement marking the seventh case we have now closed in our sector-wide investigation, taking the total of resulting enforcement packages and fines to more than £300m.”
The company will be required to deliver the redress measures included in its enforcement package during 2025-30. This is investment over and above existing plans the company committed to as part of the 2024 Price Review. These costs will be absorbed by the company and not funded through higher customer bills.
The £44.7m package is greater than the £40m fine that Ofwat would otherwise have imposed as a fine and ensures the money is spent directly on environmental improvements rather than returned to HM Treasury. Delivery of the package will be monitored by Ofwat, and the undertakings are legally enforceable.
ENDS
Notes for editors
- You can find a link to the relevant enforcement documents here: Enforcement cases – Ofwat
- Ofwat can impose financial penalties of up to 10% of a company’s relevant turnover. In deciding whether to impose a penalty and the level of that penalty, Ofwat will take account of the particular facts and circumstances of the case under consideration to establish the appropriate level of penalty to impose.
- Had this enforcement package not been accepted, Ofwat would have imposed a penalty where the money would have been returned to the Consolidated Fund operated by HM Treasury.
- The £44.7m enforcement package is greater than the penalty Ofwat would otherwise have imposed on the company (which would be £40m, or 7.5% of Dŵr Cymru Welsh Water’s annual turnover).
- In agreeing this enforcement package, it mean that the money will remain in the water sector and be spent on making improvements for the benefit of Dŵr Cymru Welsh Water’s customers and the local environment.