The chief executive of Thames Water has asserted that performance targets set by regulators are unrealistic, particularly regarding leakage reduction. He stated the company wants to improve but characterized some mandated targets as unattainable regardless of investment levels. The regulator Ofwat responded that targets are designed to be ambitious and drive better environmental outcomes, with approximately one-fifth of supplied water still being lost through leakage.
Thames Water, the UK’s largest water company serving 16 million customers across London and southern England, has faced significant regulatory scrutiny following numerous sewage discharge incidents and received a record £122.7m fine earlier this year for breaching sewage spill rules. The company operates under substantial debt and faces potential special administration, a form of temporary government control. The chief executive warned that special administration could disrupt investment and burden taxpayers, instead supporting a creditor proposal that would write off approximately £9 billion in debt while providing the government veto powers through a “golden share” arrangement.
Environmental groups have disputed the company’s characterization of pollution as inevitable, with River Action’s chief executive criticizing the company’s position and calling for conversion to public utility status. The Environment Agency stated it expects Thames Water to comply with legal requirements and will continue holding the company accountable for performance shortfalls. The company has warned it may run out of money by November.
Executive compensation at Thames Water has drawn criticism, with the chief executive’s pay increasing 14 percent to £1.163 million and other directors receiving bonuses totaling £4.1 million. He defended these levels as necessary to attract and retain talent. Additionally, Thames has implemented hosepipe bans amid broader drought conditions affecting England and Wales, with the chief executive characterizing current hot, dry weather patterns as the “new normal” and calling for additional water storage infrastructure approval.
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