Welsh Water apologises and gives rebate to customers over regulatory reporting errors

Welsh Water, the utility company responsible for water supply and treatment in Wales, has issued an apology 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 identified issues were subsequently investigated and resolved.

Restated figures from the review show that leakage levels were higher than previously reported, while per capita consumption was lower.

Leakage for the year 2021/22 was restated at 240.3 million litres per day compared to the previously reported figure of 157.4 million litres per day.

This is equivalent to 8.6 m3 per km of main per day and compares with the latest available industry data (from companies’ annual performance reports for 2021/22) which ranges between 4.5 m3/km/day (Anglian) and 18.7 m3/km/d (Thames Water).

The restatement also revealed a reduction in per capita consumption, from 174.7 litres per day to 154.8 litres per day.

Comparative data from other water companies in England and Wales for 2021/22 shows per capita consumption ranging between 131.5 and 160.3 litres per day.

To address the issue of increased leakage, Welsh Water has allocated an additional £54 million for leakage reduction measures over the next two years, aiming to bring the levels down as quickly as possible.

This investment is part of a total expenditure of £284 million on leakage reduction between 2020 and the end of the current Asset Management Period (AMP) in 2025.

Pete Perry, Chief Executive Officer, said: “We are very sorry and disappointed that this 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.”

Ofwat have today confirmed that they are reviewing the information we have provided them before deciding whether any further action is required.