Ofwat found serious and unacceptable breaches in how Dŵr Cymru Welsh Water has operated and maintained its sewage works and network.

The investigation found that Welsh Water has failed to operate, maintain and upgrade its wastewater assets adequately to ensure they could cope with the flows of sewage and wastewater coming to them. The company also failed to have in place adequate processes and oversight by its senior management and Board to ensure its assets were performing adequately and that it was meeting the legal requirements expected of it.

In acknowledging the breaches, Welsh Water has agreed to take the steps necessary to address the problems identified and there is now a proposed redress package of £44.7 million which would need to be delivered during 2025-30. These costs would be absorbed by the company, and not through higher customer bills and is investment over and above existing plans committed to as part of Ofwat's 2024 Price Review.

The redress package includes:

Lynn Parker, Senior Director for Enforcement at Ofwat, said:

“Our investigation has found serious and unacceptable breaches in how Dŵr Cymru Welsh Water has operated and maintained its sewage works and networks, which has resulted in excessive spills from storm overflows to the environment. We now expect them to focus on putting things right so that customers can regain trust in their water company and the critical service they provide.

“We understand that the public wants to see transformative change. That is why we are prioritising this sector-wide investigation, which is holding companies, like Welsh Water, to account. Pending this consultation, Ofwat will have issued enforcement action totalling over £300m.”

Ofwat can impose financial penalties of up to 10% of a company's relevant turnover. In deciding whether to impose a penalty and the level of that penalty,

The £44.7 million enforcement package Ofwat has secured is greater than if a penalty had otherwise been imposed on the company (which would have been £40 million, 7.5% of Welsh Water’s annual turnover.

Instead, the money will remain in the water sector and be spent on making improvements to service for the benefit of Welsh Water customers and the local environment.

The consultation will now be open to the public and key stakeholders to offer any comments before Ofwat’s final decision is announced. The consultation closes on Thursday 2nd April at 5pm

Click here to access the consultation online