Performance of Welsh Water 'lagging behind' says watchdog

WATER and sewerage business 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 committee level”, in seven areas, including leakage, supply interruptions, drinking water quality and treatment work compliance.

It did though 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 has 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.

“Earlier this year Welsh Water customer' bills were increased on average by 27% to cover the increased cost of meeting our regulatory and investment obligations, Welsh Water has confirmed plans to shed up to 500 jobs as part of a major restructuring.”

Welsh Water, which is owned by Glas Cymru, said over the next 18 to 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 the latest five-year regulatory period.