Thames Water has revealed a 40% increase in sewage spills while warning that a looming decision on what it can charge its customers is “fundamental to our future”.
The UK’s biggest supplier, which is struggling to avoid the prospect of a special administration amid massive debt, has always maintained that the regulator’s decision on its request for tariff increases to curb inflation could make it impossible to invest.
River Thamesand the wider industry in England and Wales, are expected to learn next week how much Ofwat will allow bills to rise over the next five years.
Last money: Increase in the price of Christmas dinner, anti-inflationary
Thames is targeting rises of 59% over the period, which would put it on a collision course with the regulator, as it says the determination will help it either unlock crucial new investment in the business or force to turn to a taxpayer bailout.
Thames, which said it had improved many of its operational performance targets in the first six months of the year, blamed the sharp increase in storm overtopping incidents for the record rainfall.
Spills are measured on a calendar year basis and reached 17,564 between January and September 2024, compared to 12,428 in the same period the previous year, Thames said.
Please use Chrome browser for a more accessible video player
Its statement added: “2024 was the wettest spring since 1986, according to the Met Office, with more than 30cm of rain in England.
“Rain or groundwater entering our sewers is often the main cause of storm overflows, called spills. In some areas, our system has been designed to operate this way, even though the circumstances of a spill may or may not be permitted.
Although the rise in sewage spills in the UK can be partly blamed on bad weather, critics say they are mainly the result of an industry that has historically placed rewards ahead of investment.
Learn more: A tough message to swallow about Thames Water wastewater
Thames is a prime example for those who say weak oversight has allowed companies to put profits ahead of customers.
The company insisted on Tuesday it was no closer to collapse, even as it revealed a 7% rise in debt, to £15.8bn, over a six-year period month.
This covered the period before the company agreed a £3bn loan deal to maintain operations beyond mid-2025.
Please use Chrome browser for a more accessible video player
Read more on Sky News:
Rupert Murdoch loses legal attempt to take control of his empire
Man charged in murder of Unitedhealthcare CEO
Starmer prioritizes economy during Saudi Arabia visit
As expected, the political reaction to the Thames update was scathing.
Liberal Democrat environment spokesman, MP Tim Farron, said: “This latest shocking increase in sewage spills must be the final straw for Thames Water. The government must place this bankrupt company into special administration to give customers the fair treatment they deserve.”
Chief executive Chris Weston said the company had made “solid progress” in its turnaround attempt and Thames had begun the process of trying to get new capital into the business.
He said he was pleased with the number of interested parties, but told investors: “The next critical step is to receive a final investable decision (from regulator Ofwat), which is fundamental to our future. »
Ofwat must decide on December 19 on the companies’ business plans.
They are collectively seeking a 40% bill increase, with Southern demanding an 84% increase between 2025 and 2030.
Thames offered a figure close to 60% in return for a jump in investment.
It recently began testing the Thames Tideway Tunnel, which aims to reduce the number and quantity of combined sewer overflows flowing into the River Thames by 95%.