The words of Emma Howard Boyd, Chair of the Environment Agency, will be at the front of the minds of the Chief Executives and board members of water companies as the sectors pollution performance has recently been scrutinised and tougher enforcement of environmental legislation has been threatened.

Last week, the Environment Agency published the “Water and sewerage companies in England: environmental performance report 2021” in which Ms Boyd sent a warning to water companies for “unacceptable” performances in 2021. For the first time, the report uses the Environmental Performance Assessment as a tool for comparing performance between water companies in several core requirements such as serious pollution incidents and self-reporting of pollution incidents. The conclusion is that two-thirds of the water companies must achieve better environmental outcomes.

The Environment Agency recorded 62 serious incidents in 2021; an increase from 44 in 2020 and the highest number since 2013. A concern is also raised that only 56% (35 out of 62) of serious incidents were self-reported by the water companies. The 2021 Environmental Performance Assessment ranked 2 out of the 9 water companies as poor (1 star) and 4 are rated as requiring improvement (2 stars). While there is certainly scope for water companies to improve, these outcomes also indicate the current regulatory regime is not working and the Environment Agency must also change its approach.

The Flow to Full Treatment investigation is already ongoing and is described as the country’s largest ever investigation into environmental crime. Concurrently the Environment Agency outlines plans to increase inspections of sewage treatment works and insist that companies put monitors on all their storm overflows. These measures are likely to result in water companies coming under greater scrutiny and an influx of prosecutions for environmental offences. The report also acknowledges that past fines have not sufficed as a deterrent. Ms Boyd calls on courts to impose much higher fines and for prison sentences to be handed out to Chief Executives and board members for serious and deliberate pollution incidents. In July 2021, Southern Water was issued with a £90 million fine for environmental offences; this may not be as much of an outlier as first thought and individual prosecutions may also be on the horizon.

Water companies should listen to the warnings of Ms Boyd as, following this report the Environment Agency clearly has a point to prove. We will see if this will be enough to encourage water companies to reach 3 or 4 stars in the Environmental Performance Assessment 2022.


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