Welsh Water told to ‘repay’ customers a total of £24.1m because of “poor performance”

Dŵr Cymru Welsh Water has been told to reduce customer bills by a total of £24.1 million next year by industry regulator Ofwat.

The penalty is because of the Nelson-based company’s “poor performance”. Ofwat has the power to restrict what water companies can charge customers if they fail to hit targets on pollution, supply issues, and leaks.

It has been placed in Ofwat’s lowest category “lagging” – one of only three companies in England and Wales to be rated as such.

Welsh Water said it was “working hard to deliver improvements”.

The £24.1m it has been ordered to ‘repay’ – the fifth highest of all water companies – is an increase on last financial year’s penalty of £18.3m

Overall, Ofwat has ordered the industry to pay back a total of £157.6m to customers.

Chief executive David Black said: “This year’s performance report is stark evidence that money alone will not bring the sustained improvements that customers rightly expect.

“It is clear that companies need to change and that has to start with addressing issues of culture and leadership. Too often we hear that weather, third parties or external factors are blamed for shortcomings.

“Companies must implement actions now to improve performance, be more dynamic, agile and on the front foot of issues. And not wait until the government or regulators tell them to act. As we look towards the next price control, the challenge for water companies is to match the investment with the changes in company culture and performance that are essential to deliver lasting change.”

A Welsh Water spokesperson said: “As a water company with no shareholders, our focus is on the service we deliver our customers and reducing our impact on the environment. Whilst Ofwat’s report published today is for 2023/24, we have seen some positive signs so far this year (2024/25). We are, however, only six months through the year and there’s still need for significant, sustained improvement.

“Between 2025 and 2030, we’ve put forward a record investment package of £4bn, this is essential to support the improvement in performance we are seeking to deliver, including £2.5bn targeted at environmental improvement.

“This investment will drive improvements for customers and ensure a high standard of performance across the company.”