Water companies have been instructed to refund £114 million to customers through reduced bills due to their failure to meet critical targets.
Ofwat, the industry’s regulatory authority, has pointed out that companies are not meeting performance criteria related to water leaks, supply, and pollution reduction.
Following a comprehensive review, millions of pounds will be returned to households through bill reductions. Ofwat’s assessment revealed that not a single company achieved the highest performance rating.
Seven companies, namely Dŵr Cymru, Southern, Thames, Anglian, Bristol, South East, and Yorkshire Water, were categorized as “lagging,” while the remaining ten were rated as “average.” None were classified as “leading.”
The regulator evaluates water companies in England and Wales against ambitious targets set in 2019 for a five-year period. Failure to meet these targets results in Ofwat imposing restrictions on the funds that companies can collect from customers. With the exception of five companies, most of the reviewed water providers will have to lower bills for customers in the 2024-25 period, rather than providing a lump sum refund to each bill payer.
The companies required to reduce bills are as follows:
- Affinity Water
- Anglian Water
- Dŵr Cymru
- Hafren Dyfrdwy
- Northumbrian Water
- SES Water
- South East Water
- South West Water (South West area)
- South West Water (Bristol area)
- Southern Water
- Thames Water
- Yorkshire Water
The exact bill reduction for individual customers will depend on their location and inflation, as the figures are provisional. Customers of other companies may experience bill increases, which will be applied automatically, though not necessarily appearing as a separate line item on their bills.
David Black, the CEO of Ofwat, expressed that although bill reductions may be a positive development for customers, it represents a disappointing outcome for those seeking overall improvement in the sector. Additionally, the regulator noted a decline in customer satisfaction. Mr. Black emphasized that rebuilding public trust won’t be a simple task but must commence with improved service for customers and the environment.
Water UK, the industry’s representative body, acknowledged that companies acknowledge the need for continued efforts to meet the increasingly stringent targets set by the regulator.
