Water sector criticised for ‘unacceptable’ performance last year

Water companies’ efforts to protect the environment in 2018 have been described as ‘simply unacceptable’, with all but one major player failing to perform at the level expected.

In its report on the industry, published today, the Environment Agency says last year marked a reversal of the gradual improvements seen since 2011. It is the first time the EA has described water company performance as ‘simply unacceptable’, with serious pollution incidents increasing.

EA chair Emma Howard Boyd said the organisation would continue to work with Ofwat to look at financial penalties to drive better environmental performance, given fines are “currently only a fraction of turnover”. She also asked companies to consider “whether dividends are justifiable” given their performance.

She said that while the report covered 2018, there was little evidence of improvement so far this year.

Northumbrian Water was the only company to achieve the highest 4 star rating, having improved on a 2-star rating over the past two years.

Meanwhile, Severn Trent Water, United Utilities and Wessex Water dropped from 4 stars to 3, with Anglian Water and Thames Water remaining on 3 stars, meaning they must improve their performance to reduce their impact on the environment.

Southern Water, South West Water and Yorkshire Water were only given 2 stars and described as demonstrating an ‘unacceptable level of performance’.

Referring to South West Water’s performance, the EA said it was once again poor and that the company had “consistently demonstrated unacceptable performance and a red rating for pollution incidents”.

It added that most water companies look set to fail to meet 2020 pollution targets, while Southern and Thames were singled out as having failed to demonstrate they have robust enough plans to maintain secure water supplies.

In response, the EA is increasing inspections and auditing of company performances and launching a new programme called Improving Water Company Performance, which will focus on the worst offenders.

EA executive director of operations, Dr Toby Willison, said: “Water companies need to clean up their act. People expect water companies to improve the environment, not pollute rivers and ensure secure supplies of water.

“With only one exception, none of the companies are performing at the level we wish to see, the country expects and the environment needs. We will continue to challenge CEOs to improve company performance and we will take strong and appropriate enforcement action.

“Companies performing well have a positive ripple effect on the natural environment and communities in their regions. We want all water companies to meet the expectation of their customers, the needs of environment and learn from the best practice that the leading company is demonstrating.”

Responding to the report, Water UK chief executive Michael Roberts said: “This year’s assessment of environmental performance is disappointing, given the major progress which water companies have made over many years in improving the environment.  As the Environment Agency acknowledges, the situation is never black and white.  Six out of nine companies are rated good or better in the assessment, and the most serious pollution incidents are down 18% on the previous year, but there is much more to do across the board to achieve the high standards which people rightly expect water companies to meet.

“Our good record on improving the environment is there for all to see. By 2020 the industry will have invested around £25 billion into environmental work, putting in more advanced treatment methods to improve the quality of our waterways. This will mean around 10000 miles of UK rivers have been improved and protected since 1995. And the industry has made a major commitment for the future, with an additional £5 billion to be spent between 2020 and 2025 on environmental improvements, and a reduction in serious pollution incidents of 90% by the end of 2025.

“Improving the environment remains a key priority for the industry and companies will work closely with regulators to ensure we deliver on our ambitious commitments.”

Alison Hoyle, director of risk and compliance at Southern Water, said: “There has been a complete step change in our pollutions team over the past two years and this is reflected in the far higher level of self-reporting as new systems and processes kick in.

“We know we have more to do. More awareness training for staff means we are now finding and fixing issues sooner and an improvement programme at all of our high impact sites is making good progress.

“To our disappointment we suffered a small number of more serious pollution incidents during the year.

“We continue to invest in our sites to increase resilience and we are working closely with the Environment Agency to ensure we learn the correct lessons from these events.

“A major factor in our rating for water supply resilience was the challenge we face in Hampshire following the introduction of new restrictions on water abstraction from the rivers Test and Itchen.

“Over the next 10 years we plan to spend more than £800 million to make up the deficit created by the new licences.

“We also received a good score – the third highest – for discharge permit compliance, which relates to the quality of treated wastewater leaving our sites.

“Our delivery of environmental improvement schemes was also strong.”