Ofwat concludes Welsh Water leakage investigation with extra money off bills for customers

Ofwat has told Welsh Water to pay £40m for misreporting its leakage and per capita consumption performance figures over a period of five years.

The company announced a £15m payment to customers in the form of a £10 bill rebate in May 2023, and Ofwat said a further £9.4m would come off of future bills on the back of its investigation in the form of Outcome Delivery Incentive penalties. The remaining £15m of benefit is in the form of additional leakage expenditure which Welsh Water will absorb rather than passing through to customers.

In addition, Welsh Water has already committed to invest an extra £59m in the current price period to address what Ofwat called its poor performance on leakage and PCC.

Welsh Water’s own assurance processes initially identified concerns after an internal review concluded that elements of its calculations on PCC and leakage for the years 2020-2022 did not comply with regulatory requirements. The company apologised last year, and reiterated that apology last week following Ofwat’s announcement.

Ofwat chief executive, David Black, said: “We need to invest tens of billions of pounds over the next 30 years to reduce pollution and ensure that our water infrastructure can grow with our population and adapt for climate change. Customers and investors will only agree to fund this if they trust water companies to provide accurate information about their performance.

"For five years, Welsh Water misled customers and regulators on its record of tackling leakage and saving water. It is simply indefensible and that is why we are making Welsh Water pay this £40m to benefit its customers.”