UPDATE: 7th September ’22 the new DEFRA Secretary wrote to water companies to write to him formally by 21st September ’22 with their plans to make significant improvements.
6th September ’22, an Urgent Question was asked (in the House of Commons) of the then DEFRA Secretary George Eustice about storm water overflows. His answers provided an update – (the DEFRA Secretary has now changed) –
(1) When appointed DEFRA Secretary in February 2020 Mr Eustice instructed officials to change the strategic policy statement for Ofwat to give the issue greater priority.
(2) The Environment Act 2021 sets a requirement for water companies to reduce the harm caused by sewage discharges.
(3) Water companies are investing £3.1 billion to deliver 800 storm overflow improvements across England by 2025. Mr Eustice stated this would deliver an average 25% reduction in discharges by 2025.
(4) In 2016, only 5% of storm overflows were monitored – almost 90% are now monitored, and Mr Eustice stated by next year 100% of all storm overflows would be required to have monitors fitted. There are 15,000 storm overflow discharge points in England.
(5) The Environment Agency and Ofwat have launched criminal and civil investigations into water companies, at more than 2,200 treatment works, following the improvements made to monitoring data. That follows 54 prosecutions against water companies since 2015, securing fines of nearly £140 million.
(6) The Environment Act 2021 makes it a legal requirement for companies to provide discharge data to the Environment Agency and to make it available to the public in near real time: within an hour.
(7) The Environment Act 2021 gives new powers to Ofwat to modify water company licence conditions. Mr Eustice stated Ofwat is currently consulting on proposals that will enable it to take enforcement action against companies that do not link dividend payments to their environmental performance or that are failing to be transparent about their dividend payouts. It’s possible the consultation referred to is one on PR24 here. Note Ofwat’s expectation (PR24) that investor returns would be linked to the ability of companies to create and deliver value for customers and the environment, and the expectation that companies would take significant action to improve the environment and resilience. The City Briefing of 7 July ’22 gives further detail – here.
(8) On 5th September ’22, the storm overflows discharge reduction plan (required by the Environment Act 2021) was laid before Parliament. This plan underpins the £56 billion of capital investment over the next 25 years cited by Mr Eustice and the initial £3 billion investment to reduce discharges by 25% by 2025 at point (3) above. The plan makes a priority of designated bathing waters and other priority sites with a target of 2035. The plan foresees significant reductions in discharges at 75% of high-priority sites. The government’s storm overflows discharge reduction plan (England) is here.
(9) On 27th June ’22, the Office for Environmental Protection announced its first investigation: of the roles of Ofwat, the Environment Agency and the DEFRA Secretary in the regulation of combined sewer overflows (CSOs) in England – the announcement is here.
(10) The Environment Agency’s costs for monitoring water companies’ permits for the management of combined storm overflows are cost-recovered through the permit. In addition, Mr Eustice said the government provides some support.
(11) Southern Water is one of the companies that was recently investigated, and it was subject to a record fine of close to £90 million. The fine precipitated a change in ownership of that company and additional equity injected – the Ofwat (August ’22) consultation on the transfer that took place in 2021 is here.
(12) Mr Eustice distinguished – one matter is the failure of water companies to abide by their permit conditions, the reason for the Environment Agency bringing multiple prosecutions. Another matter is the separate issue of the permitted use of storm overflows. That issue is about long-term investment in infrastructure, which is the focus of the government’s storm overflows discharge reduction plan.
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