The peformance of Welsh Water is 'lagging behind', says watchdog

WELSH Water (Dŵr Cymru) said its downgrading by credit rating agencies is now having a material impact on its bond borrowing costs.

- SION BARRY

It comes as industry regulator Ofwat has ranked the not-for-profit company in the lowest category in its water company performance report for 2024-25.

Of the 17 water companies in England and Wales, Welsh Water, as in last year's report, sits in the "lagging behind" category, along with Southern Water, Thames Water, Yorkshire Water and SES Water.

Welsh Water was assessed as having a "poorer than performance commitment level" in seven areas, including leakage, supply interruptions, drinking water quality and treatment work compliance.

It did have a "better than performance commitment level" in five areas, including customer satisfaction and sewer collapses, and was the top performer for internal sewer flooding which it been for the past four years.

Ofwat identified Portsmouth Water as the best performance. Flintshire-based water company Hafren Dyfrdwy scores relatively highly with an "average" classification.

The report says of Welsh Water: "It needs to do more to improve resilience to supply interruptions and needs to continue the leakage improvement observed in 2024-25 to get back on track for delivery of its strategic targets."

Welsh Water, which is owned by Glas Cymru, said over the next 18-24 months it will reduce its current headcount of 4,000 by 12% (500 people).

Customer bills have also been increased on average by 27% to cover the increased cost of meeting its regulatory and investment obligations in latest five-year regulatory period.

Earlier this year rating agency's Moody's and Fitch downgraded its ratings for Welsh Water, along with other firms in the sector.