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Regulator blasts water companies for winter leak failings
Regulator Ofwat has criticized water providers Thames Water, South East Water, Southern Water and Severn Trent for their poor handling of water supplies during the 'Beast from the East' earlier this year.
The regulator said that over 0.2m people in England and Wales, including customers of FTSE-listed Severn Trent, were left without access to water for over four hours when pipes froze and burst in March, with some customers left without water for over a week.
Almost three quarters of those affected did not receive alternative supplies of water.
Rachel Fletcher, chief executive of Ofwat, said: "The freeze and rapid thaw earlier this year was forecast and was not unprecedented. A number of water companies showed what can be done to serve customers in the face of bad weather. But too many companies were caught off guard and let people down, causing real hardship as a result. Our report shows there is no excuse for this level of failure."
Despite the acknowledgement that frontline staff "worked tirelessly," Ofwat said the companies' responses were plagued by poor advance planning, inadequate communication with customers and a lack of basic support such as bottled water.
The four highlighted providers will be required to submit a detailed and externally audited action plan which sets out how to combat the identified issues by 28 September.
Ofwat said it will take further action against a company that fails to provide a satisfactory response.
A total of £7m in compensation has been paid out to customers but the regulator deemed the amount to be "not reflective of the impact on customers".
Thames Water was ordered last week to repay users £120m for failing to control leaks.
"We expect every water company to take action on the back of this review and the industry as a whole to transform how it works together in situations like these. Water is an essential service. Water companies must be prepared for whatever the weather brings," said Fletcher.
As of 0949 BST, Severn Trent's shares were down 0.67% at 1,851.00p.