Welsh Water offers £10 rebates as Ofwat investigates it and South West Water over leakage

Ofwat has opened enforcement investigations relating to the accuracy of information reported by Welsh Water and South West Water relating to performance on leakage and per capita consumption.

Welsh Water flagged up inaccuracies relating to the 2020-21 and 2021-22 years to Ofwat as part of its 2021-22 Annual Performance Report assurance. The company said it would pay a £10 rebate to every customer after an internal review identified governance and management oversight failures that led to leakage being under-reported and per capita consumption over-reported.

Total leakage for 2021/22 was 240.3 ml/d compared to 157.4 ml/d previously reported. Welsh Water said this is equivalent to 8.6 m3 per km of main per day which is within the 2021-22 industry range (4.5 m3/km/day for Anglian to 18.7 m3/km/d for Thames). Restating per capita consumption data to reflect the change resulted in a reduction from 174.7 litres/day to 154.8 litres/day. Again this is within the industry range (131.5 litres/day at Yorkshire to 160.3 litres/day at Portsmouth).

In addition to the customer compensation, Welsh Water has allocated an additional £54m to tackling leakage over the next two years to bring the level down as quickly as possible.

The South West Water investigation appears to be Ofwat-identified. During its Your Water, Your Say session last week, chief executive, Susan Davy, said the company would provide any information Ofwat requires to assist the investigation.

Potential enforcement actions for breaches of licence conditions and relevant requirements under the Water Industry Act 1991 range from issuing an enforcement order to bring a company back into line with its obligation to imposition of a financial penalty of up to 10% of company turnover.

In his comments, Ofwat chief executive, David Black, recognised Welsh Water had self-reported and said the investigation would consider the remedial measures the company had offered customers alongside Welsh Water's restated performance figures, the circumstances that led to the company reporting inaccurate performance, and what steps it has taken or is taking to address these failings.