Fears Welsh Water errors will hamper environmental improvements for rivers

Concerns have been raised by environmental groups following Welsh Water’s recent announcement that it had miscalculated both the volume of water leaking from its networks and the amount used by its customers in 2020/2021.

Welsh Water, the utility company responsible for water supply and treatment in Wales, issued an apology last month and announced a £10 rebate for every customer due to incorrect regulatory reporting in 2020 and 2021. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

An internal review conducted by the company revealed that elements of its calculations for leakage and per capita consumption did not comply with regulatory requirements during these years. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

The review, which lasted over 15 months and involved independent experts, was initiated after Welsh Water’s own assurance processes raised concerns regarding leakage and per capita consumption reporting. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

The utility company found that leakage was 52% higher than was previously stated and that customers had used 11% less water. Ofwat are now investigating the findings.

On behalf of Welsh river trusts, environmental charity Afonydd Cymru,  wrote to the Chief Executives of Welsh Water and Ofwat asking for reassurances that the water company’s error would not threaten its commitments to improve future environmental performance and river water quality.

Welsh Water said it has now allocated an additional £54 million for leakage reduction measures over the next two years.

Its future investment programme includes funding to deliver against a range of measures, including to secure long-term sustainable water resources (via the Water Resource Management Plan) and the Drainage and Wastewater Management Plan (DWMP).

Central to their delivery are assumptions regarding water demand in Wales, including leakage profiles and per capita consumption.

There are fears that the new figures could mean that Welsh Water’s target for reducing leakage in the next investment period (PR24) set out in November last year is unachievable and that their plans may need to be revised.

Gail Davies-Walsh, Chief Executive of Afonydd Cymru, said:

“Last week’s revelations give us some doubts about whether Welsh Water will be able to stick to its environmental improvement commitments. In particular, whether there will now be sufficient funding to reduce its negative impacts on rivers through improving sewage treatment work outfalls and overflows.”

She added: “Allocating a further £54 million to fix leaks and giving every household a £10 rebate (£14 million in total) means that extra money will need to be found. We do not want to see any slippage in Welsh Water’s delivery of work to improve river water quality as a result. This is something we will be watching closely.

“It is also worth noting that in a survey of Welsh Water customers carried out by water consumer group CCWater last year, 58% said they would pay more on their water bill if it supported investment to reduce the need to use storm overflows.”

“While appreciating the current cost of living crisis, we would therefore question whether the £10 rebate might be better spent on environmental improvements This is something perhaps Welsh Water should ask its customers. ”

Pete Perry, Chief Executive Officer, said: “We are very sorry and disappointed that this [incorrect reporting] has happened.”

“We’re investing an additional £54m over the next 2 years to identify and reduce leakage as quickly as possible and we have shared the findings of our investigations with our regulator.” ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

“Whilst our robust assurance process ultimately identified the issue, there were failures in our governance and management oversight processes that allowed this in the first place.” ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

“We have made the necessary changes to how we manage leakage reporting and closed the gaps in our reporting and governance processes.” ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​