Water bills may be cut over sewage dumping

Ofwat points finger at ‘widespread shortcomings’ in first part of investigation against five companies

‘We have already seen enough in five companies to cause serious concern and warrant us taking further action’

‘Companies will continue to work closely with regulators to assess and address any issues that arise’

CUSTOMERS could be given refunds if water firms dump sewage without good reason, as Ofwat announced it was investigating five companies.

Firms face fines of up to 10 per cent of their turnover if the consumer regulator finds they have broken rules governing sewage releases into rivers and the sea.

Ofwat yesterday announced “enforcement cases” against Anglian Water, Northumbrian Water, Thames Water, Wessex Water and Yorkshire Water as part of a wider investigation into river pollution by water companies.

David Black, interim chief executive, said the first part of its investigation had suggested “widespread shortcomings”.

“We have already seen enough in five companies to cause serious concern and warrant us taking further action,” he added.

If the companies are fined, the money could end up going back to customers to compensate them for the failings, leading to lower bills.

Ofwat has also suggested that it might force companies to cut executive bonus pay, which for some reaches millions of pounds, if they fail to follow pollution rules.

The water industry is facing growing scrutiny over the routine practice of allowing sewage and runoff to overflow into rivers and the sea, harming wildlife and swimmers.

The “storm overflow” systems are supposed to be used only in times of extreme rainfall when sewage treatment works are unable to cope with the amount they need to process.

But data show that in practice they are used thousands of times a year, including in times of dry weather.

Last month The Daily Telegraph revealed that water companies released untreated sewage into rivers more than 1,000 times a day in 2020, as it launched a Clean Rivers campaign calling for better protection for waterways.

Permits allow the water companies to spill if their systems are full and they carry on treating sewage.

But Ofwat believes that some are allowing sewage to enter their storm tanks earlier than they are supposed to, meaning spills are illegal.

The regulator also thinks companies have not been transparent enough about their spills or are not monitoring their treatment plants well enough.

Both Ofwat and the Environment Agency can fine water companies which break environmental rules, but the agency’s criminal fines are imposed by the courts, take longer to be enforced and have historically been relatively low.

A record £90million fine in 2019 against Southern Water for repeated sewage dumping between 2010 and 2015 was a significant exception. The company was fined £126million by

Ofwat for “serious failures” over the same period, also a record.

In that case, customers received £123million from the company, receiving a discount of around £60 off their water bills over a five-year period.

Analysis by The Daily Telegraph last year found that the nine main water companies were fined just 0.7 per cent of their post-tax profits in Environment Agency cases over the past decade.

A spokesman for industry group Water UK said: “Water companies have been investing heavily to modernise the monitoring of sewage treatment works, and are increasingly using better modelling and artificial intelligence techniques to quickly find and fix any problems.

“Companies will continue to work closely with regulators to assess and address any issues that arise.”