Disappointment as United Utilities drops to 3 star rating in annual report on water company environmental performance

THE latest annual Environmental Performance Assessment has seen Warrington-based United Utilities in the North West rated 3 star – a “disappointing” drop from its 4 star rating in 2021.

The Environment Agency has released its annual report on the environmental performance of England’s nine water and sewerage companies.

Nationally, the report shows modest improvements to water company star ratings under the Environmental Performance Assessment (EPA) report in 2022, compared to 2021.
Measured against the Environment Agency’s 4-star rating, four companies have stayed the same, three have improved and two have got worse.

1. Severn Trent Water –  4 stars, the same as the previous year
2. Northumbrian Water – 3 stars, down from 4 stars
3. United Utilities – 3 stars, down from 4 stars
4. Yorkshire Water – 3 stars, up from 2 stars
5. Anglian Water – 2 stars, the same as the previous year
6. Thames Water – 2 stars, the same as the previous year
7. Wessex Water – 2 stars, the same as the previous year
8. Southern Water – 2 stars, up from 1 star
9. South West Water – 2 stars, up from 1 star

Since 2011, the Environment Agency has used the Environmental Performance Assessment (EPA) to rate each company in England from 1 star to 4 star. The rating takes into account performance on environmental commitments such as pollution incidents and treatment work permit compliance. Last year an updated reporting approach was introduced, with revised metrics and tightened performance thresholds.

This year’s report has found that:

1. The number of serious pollution incidents has reduced from 62 in 2021 to 44 in 2022 but remains unacceptably high. More than half of serious pollution incidents were from assets of Anglian Water and Thames Water – EA have taken enforcement action against both companies.
2. Total pollution incidents were similar to 2021 and remain too high.
3. Incident self-reporting was at 82% – the best since the start of the EPA in 2011. However, this contrasts to self-reporting on serious incidents which was only 48%.

The results show that although there have been some improvements, all water companies need to go further and faster.
In the North West, United Utilities dropped from a 4 star (industry leading) company to 3 star (good). This was due to the company’s performance around permit compliance.
United Utilities achieved 98.5% for permit compliance, which must now be above 99% and green for a water company to achieve a 4 star rating as the Environment Agency continues to expect better performance in this area.

In other areas, there were no serious pollution incidents during 2022, making United Utilities one of only two companies meeting basic requirements for this metric. There was also an improvement in total pollution incidents, with 16 per 10,000km of sewer, down from 18 in 2021.
United Utilities self-reported 88% of incidents, slightly better than the sector average of 82%, and delivered 100% of its schemes under the Water Industry National Environment Programme (WINEP), delivering 316 projects to improve the environment. It was also consistent in the other metrics for satisfactory sludge use and disposal and water supply and demand.

Carol Holt, Area Director for the Environment Agency in the North West, said: “It is disappointing to see this drop in rating for United Utilities and we are clear that things simply must improve.
“While there have been some improvements, including a drop in pollution incidents, there is still much to be done.
“We are constantly carrying out enforcement activity, including putting water companies before the courts and there are several criminal investigations ongoing in relation to incidents and potential permit breaches. We welcome the Environment Agency’s new powers to issue unlimited penalties when companies commit environmental offences and do not meet the high standards that the public rightly expect.”

The Environment Agency has also set out how it will:

1. Create a bigger specialised workforce to focus solely on water company regulation. By autumn this year nearly 100 officers will be trained in carrying out more detailed audits of water companies to quickly identify issues and put improvement actions in place.
2. Significantly increase compliance checks for every company – making sure they are sticking to the permits agreed with the Environment Agency.
3. Recruit more data specialists to make better use of analytics and technology.
4. Transform huge quantities of monitoring data into stronger regulatory intelligence. That includes using data-driven analytics to map monitoring data against rainfall to detect potential dry weather operation of storm overflows – known as ‘dry spills’. It means the Environment Agency can quickly direct new specialist officers to any sites at risk and stop it happening.

Water Minister Rebecca Pow said:  “Today’s report shows there is significant work to do to drive the improvements in our rivers and seas that we need to see.
“The government’s Plan for Water is focused on more investment, stronger regulation and tougher enforcement than ever before. I am personally committed to driving that forward and demanding more from each and every water company.
“We have also put new regulatory powers in place to allow the Environment Agency to impose sanctions on water companies without always going through the courts. This will be an important tool in its armoury to hold companies to account.”

Environment Agency Chair Alan Lovell said: “Regulators, water companies, government, eNGOs and many others all want the same thing: better environmental outcomes, including cleaner rivers and seas. We need to work together and take collective responsibility to achieve it.
There have been minimal improvements, it is unacceptable to still be seeing this level of pollution. We have seen a distinct culture shift from the water industry in recent months and that is welcome – but that must translate to profound, long-term change.
“The Environment Agency will play its part by transforming the way we regulate the sector. We welcome this week’s announcement on unlimited penalties which will also improve our enforcement powers.”

The report comes as the government today published new law to allow the Environment Agency’s to impose unlimited civil sanctions on water companies for environmental offences
Since 2015 the Environment Agency’s prosecutions against water companies have secured fines of over £150 million. In 2022 the Environment Agency concluded nine prosecutions against water and sewerage companies with fines of more than £4 million.