Firms to comply with sewage probe as Ofwat reports industry issues and targets five

Water companies have indicated they will fully comply with regulatory investigations into wastewater compliance; would have provided any further detail required already had they been asked; have ongoing work programmes in place to invest in monitoring and improvements; and in some cases have been in discussions about sewage works compliance with regulators for some time anyway.

This was in response to Ofwat’s announcement last Wednesday that all water companies remain subject to ongoing investigation in the review it opened in November into companies’ sewage treatment works compliance with environmental permits, with five firms – Anglian Water, Northumbrian Water, Thames Water, Wessex Water and Yorkshire Water – made subject to formal enforcement cases.

Ofwat said all but Hafren Dyfrdwy reported in their December submissions that some treatment works were potentially non-compliant with the flow to full treatment (FFT) requirements of their environmental permits.

Around 70% of these are small works, serving populations of less than 10,000. It reported that companies identified among the following root causes:

• the failure of a particular part of the equipment at the wastewater treatment works;

• a part of the works not being installed with sufficient physical capacity to meet the FFT level set out in its environmental permit;

• a part of the works operating at a level less than its design intended due to maintenance issues.

• the incorrect set up of site controls or data monitors at the treatment works; and

• errors by operational staff.

Ofwat said the extent and quality of the compliance data supplied by companies in their December submissions varied considerably, as did the responses to its other lines of enquiry, including: governance oversight of compliance; how environmental performance is considered in decisions about pay and dividends; how non-compliant works are being addressed; and how companies are rebuilding customer trust on this issue.

The regulator said it had targeted the five firms specifically for enforcement because the information they provided in December raised one or more of the following concerns:

• a significant number of works might be non-compliant;

• how the company manages compliance with its environmental obligations overall could fall short of expectations; and

• insufficient demonstration of how compliance has been established.

Interim chief executive, David Black, commented: "We have identified shortcomings in most water and wastewater companies and are continuing to investigate. But we have already seen enough in five companies to cause serious concern and warrant us taking further action.”

Details of the individual situations of each company have not been made public, but it is understood there is considerable variance between the five companies in terms of the nature and extent of the concerns flagged by Ofwat. Some, for instance, are understood to have significant numbers of works potentially non compliant, whereas for others the issue appears to be centred more around board oversight arrangements.