Dŵr Cymru/Welsh Water has been hit with a £44.7 million penalty by Ofwat for failing to properly manage its wastewater treatment works, leading to environmental damage.

Ofwat has confirmed its final decision to formally accept a £44.7m enforceable package of undertakings from Dŵr Cymru/Welsh Water. This closes the seventh case in its sector-wide wastewater investigation and takes the total of resulting enforcement packages and fines across the sector to more than £300m.

Ofwat previously announced on March 12 that the company had failed to operate, maintain and upgrade its wastewater treatment works and networks adequately to ensure that they could cope with the flows of sewage and wastewater.

A consultation period followed where customers and stakeholders provided feedback on the provisional decision.

Having assessed all the responses received, Ofwat has formally accepted the enforcement package which includes redress to customers and the environment including:

  • £40.6m to address harm and reduce spills at specific overflows. The company will also investigate and carry out sealing works on private parts of the sewer network to tackle groundwater infiltration, which is a significant contributor to frequently spilling overflows.
  • An additional £4.1m will be invested to improve water quality and biodiversity in extremely sensitive catchments.

Lynn Parker, Senior Director for Enforcement at Ofwat, said: “Our investigation found serious and unacceptable breaches in how Dŵr Cymru Welsh Water has operated its wastewater assets which has resulted in excessive spills to the environment.

“With this investigation now concluded, we expect the company to focus on putting things right so that customers can regain trust in their water company.

“We are playing our part in holding companies to account with this announcement marking the seventh case we have now closed in our sector-wide investigation, taking the total of resulting enforcement packages and fines to more than £300m.”

David Chadwick / Welsh Water
Welsh Liberal Democrat Westminster spokesperson David Chadwick MP, said: "These findings confirm what communities across Wales have known for years - Welsh Water has been failing to do its job while rivers, streams and coastlines have paid the price.” (Welsh Water/Welsh Liberal Democrats)

The company will be required to deliver the redress measures included in its enforcement package during 2025-30. This is investment over and above existing plans the company committed to as part of the 2024 Price Review. These costs will be absorbed by the company and not funded through higher customer bills.

The £44.7m package is greater than the £40m fine that Ofwat would otherwise have imposed as a fine and ensures the money is spent directly on environmental improvements rather than returned to HM Treasury.

Delivery of the package will be monitored by Ofwat, and the undertakings are legally enforceable.

Commenting on the news, Welsh Liberal Democrat Westminster spokesperson David Chadwick MP, said: "These findings confirm what communities across Wales have known for years - Welsh Water has been failing to do its job while rivers, streams and coastlines have paid the price.

"People will be rightly furious that it has taken intervention from Ofwat and a £44.7 million enforcement package to force action on failings that should have been addressed years ago.

“Dŵr Cymru likes to present itself as different from other water companies, yet despite its not-for-profit model, it has still overseen serious wastewater failures, and they have still paid out massive executive bonuses.

"The Welsh Liberal Democrats will continue to push for far stronger regulations, backed by properly resourced enforcement, to ensure polluters are held accountable, and our rivers are properly protected."