REG - Water Services Auth - Next phase of Ofwat wastewater investigation

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09/03/2022 08:15

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RNS Number : 0989E  Water Services Regulation Authority  09 March 2022

Wednesday 9 March 2022

Five water companies targeted in next phase of Ofwat wastewater treatment work
investigation

Ofwat has today announced that it is opening enforcement cases into five water
and wastewater companies as part of its ongoing investigation into how
companies manage their wastewater treatment works.

Anglian Water, Northumbrian Water, Thames Water, Wessex Water and Yorkshire
Water have been served formal notices to gather further information for
enforcement purposes. This follows analysis of the information water and
wastewater companies were asked to submit to Ofwat in late December about how
many of their sewage treatment works might not be meeting requirements in
their environmental permits, and what companies are doing to resolve that.

Concern about aspects of these five companies' submissions has prompted
Ofwat's current focus. However, all water and sewerage companies in England
and Wales remain subject to the ongoing investigation as Ofwat continues its
review of the information it has gathered. Ofwat will keep the enforcement
cases under review, and the companies in focus may change as new information
comes to light.

The five companies are targeted because the information they provided in
December raised one or more of the following concerns:

·    it reported a significant number of wastewater treatment works which
the company considers might not be compliant with its environmental permits,
and/or

·    it raised concerns about how overall the company manages its
compliance with its environmental obligations, and/or

·    it didn't sufficiently show how the company have established whether
its treatment works are meeting the requirements of its environmental permits,
and so we need further information for our assessment.

In addition to opening these five enforcement cases, Ofwat continues to
monitor Southern Water's compliance with a package of commitments it made
following Ofwat's enforcement action in 2019
(https://www.ofwat.gov.uk/pn-21-19-ofwat-confirms-southern-water-will-pay-126m-following-investigation/)
. Ofwat will look at whether the latest investigation identifies anything new
or different of concern not already covered by the previous enforcement action
and commitments.

In their December responses to Ofwat, all but one company (Hafren Dyfrdwy)
reported having had some treatment works that were potentially non-compliant
with the flow to full treatment (FFT) requirements of their environmental
permits. Many companies set out the steps they have taken or are taking to
bring those treatment works back into compliance. However, some companies did
not offer sufficient assurances that they monitor and understand the
compliance of their treatment works, or the root causes of any non-compliance.

David Black, Ofwat interim Chief Executive, said:

"The data that emerged at the end of last year suggested widespread
shortcomings in how water companies were running sewage treatment works. The
first phase of our investigation suggests those concerns are credible.

"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.

"We will now dig deeper into what these five companies have been doing, with
the prospect of formal enforcement against them if we find they are failing on
obligations Ofwat enforces.

"We will have further questions for all companies on this. In the meantime, we
expect them to make quick progress in addressing any potential non-compliance
they might have, whilst strengthening how they manage their environmental
obligations as a whole."

Ofwat's enforcement powers can see the regulator fine companies up to 10% of
their annual turnover.

Notes for editors

·    A more detailed summary of what water and wastewater companies have
told Ofwat in the information provided in December 2021 is on the
investigation page on Ofwat's website
(https://www.ofwat.gov.uk/investigation-into-sewage-treatment-works/) .

·    Ofwat is committed to being open and transparent throughout the
investigation and will be providing regular updates on the website
investigation page
(https://www.ofwat.gov.uk/investigation-into-sewage-treatment-works/) .

·    More information is expected to come to light as the investigation
progresses. Ofwat is working closely with the Environment Agency, who are
carrying out a criminal investigation into companies' compliance with
environmental permits. Ofwat's focus and timelines differ from the Environment
Agency because of the different statutory and enforcement powers each
regulator has. While the Environment Agency is investigating potential
breaches of individual environmental permits at treatment works under a
criminal investigation (and as such must be conducted in accordance with
criminal rules and procedures), Ofwat is looking at how overall companies
operate and manage their wastewater treatment works and how they report on
their performance about this. More information about the Environment Agency's
investigation can be found here
(https://environmentagency.blog.gov.uk/2022/02/16/environment-agency-investigation-into-sewage-treatment-works/)
.

·    Issuing notices to gather information for enforcement purposes is not
necessarily an indicator that Ofwat intends to pursue formal enforcement
action against these companies but does indicate that Ofwat considers that a
company may not be or may not have been complying with its obligations. The
information gathered will enable Ofwat to establish if it needs to seek
further information or if its concerns have been addressed.

·    The investigation page on Ofwat's website
(https://www.ofwat.gov.uk/investigation-into-sewage-treatment-works/) provides
details of what we are investigating, why we are investigating, how we will do
it and our proposed timescales.

·    The enforcement page on Ofwat's website, 'how we investigate'
(https://www.ofwat.gov.uk/regulated-companies/investigations/how-we-investigate/)
, provides more details on Ofwat's enforcement process.

·    The Environment Agency and Ofwat's investigations were announced in
November 2021.

o  Joint PN: Water companies could face legal action after investigation
launched into sewage treatment works
(https://www.ofwat.gov.uk/joint-ofwat-environment-agency-and-defra-announcement-november-2021/)

o  Ofwat PN: Ofwat launches investigation following claims water companies
broke the law
(https://www.ofwat.gov.uk/pn-35-21-letter-from-david-black-to-water-companies-november-2021/)

o  Letter from David Black to water companies
(https://www.ofwat.gov.uk/publication/letter-from-david-black-to-water-companies-november-2021/)
in November 2021

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