£36m underlying loss for water firm
Wales’ largest water company Dwr Cymru Welsh Water has reported underlying losses of £36m in its latest financial results.
The not-for-profit business attributed the losses, which come after it made profits of £16m last year, to higher interest rate costs linked to a rise in inflation, and increased investment in maintaining its infrastructure.
The company supplies water to customers in most parts of Wales apart from parts of Powys and the north east. It also supplies customers in Herefordshire.
It was confirmed earlier this year that average customer bills, at £439, have been held at or below the Retail Price Index (RPI) rate of inflation for the eighth year in a row.
Welsh Water confirmed £350m capital investment for the year out of a total of £1.7bn between 2015 and 2020.
This includes £21m in the drinking water supply in west Wales, £9m in water treatment works in the Rhondda Fawr Valley, £24m in transforming the Five Fords wastewater treatment works in Wrexham into an innovative Energy Park and £40m in its Rainscape sustainable drainage programme in Llanelli, Burry Port and Gowerton.
Welsh Water also announced how it intends to spend an extra £34m in planned investment on customer benefits.
The investment plans follow a consultation carried out with more than 12,000 customers and adds to the £32m extra investment announced last year.
The consultation showed strong support for community projects, investment to secure high quality services, and funding for social tariffs for the lowest earning customers, while keeping overall bills as low as possible.
Welsh Water announced some of the projects that will benefit from the increased investment. They include:
£5m to support the lowest earning households by charging them lower bills;
£10m extra for major replacement of ageing parts of the drinking water pipe network, including the Rhondda Valley, Hereford and Anglesey;
£3.5m extra to reduce the 2,000 blockages a month in the sewer network which can result in flooding and pollution incidents;
£5m for improvements to water treatment works to make them more resilient to increased threats such as extreme weather;
£5m to help improve customer service for households and businesses through new online systems, apps and over the telephone services.
The company is also spending more than £5m on its visitor centres and recreational facilities, including restoring Cardiff’s Llanishen and Lisvane reservoirs as part of a longer-term plan to bring them back into public use.
It also plans to boost funding in improving recreational access and biodiversity at Llyn Alaw reservoir on Anglesey, Swiss Valley reservoir in Llanelli, and Lliw reservoir in Felindre, Swansea, and to modernise visitor centres at Llyn Brenig in Conwy and Elan Valley.
Welsh Water is owned by Glas Cymru, whose chairman Alastair Lyons said: “As a company that exists solely to serve our customers we try constantly to drive improvements in the service we provide in order to meet customers’ expectations by delivering the best possible service at the best possible value.
“Our not-for-shareholder ownership model enables us to reinvest the profit we make into the business focused exclusively on what is in the best interest of customers.
“Derived from a strong performance over the year, it is pleasing to see the dividend our model is delivering for our customers rather than being paid away to shareholders.”
A record 70,000 customers already receive help to pay their water and sewerage bills, with low income households who are accepted onto the HelpU tariff having their annual bills capped at £190 per year.