Water regulator Ofwat has launched an investigation into Thames Water over concerns it will not complete more than 100 environmental schemes funded by customers.
The regulator said it will probe whether delays to the plans mean England’s largest water firm has breached its licence.
The schemes were aimed at making improvements to water companies’ environmental impact, such as through upgrades to sewage treatment works and reducing wastewater spillages.
Customers have paid for Thames Water to carry out these essential environmental schemes
Thames Water pledged to carry out 812 schemes as part of a wider national programme between 2020 and 2025, to meet national regulations.
But Ofwat said it was told by the utilities giant that it would be unlikely to complete more than 100 of these schemes by the end of March deadline.
Lynn Parker, senior director for enforcement at Ofwat, said: “Customers have paid for Thames Water to carry out these essential environmental schemes.
We are opening an enforcement case against Thames Water
— Ofwat (@Ofwat) February 12, 2025
We are investigating whether the delays to delivering its environmental improvement schemes have meant that it has breached its obligations
Read our statement: https://t.co/SAL1d3t0TD pic.twitter.com/uUd6EICHES
“We take any indication that water companies are not meeting their legal obligations very seriously.
“Therefore, we have launched an investigation to understand whether the delayed delivery of environmental schemes means that Thames Water has breached its obligations.
“If we find reason to act, we will use our full range of powers to hold Thames to account for any failures and will require them to put things right.”
Thames is currently the only firm regulated by Ofwat to be facing a probe into its environmental protection programmes.
Customers will not pay twice for investment that has already been funded through customer bills
Meanwhile, the parent company of the embattled utilities firm is set to run out of money by late March and risks entering special administration if it does not get court approval for a restructuring plan.
It is in about £16 billion of debt and needs £3.3 billion over the next five years to keep running.
A spokeswoman for Thames Water said the company will “co-operate fully” with Ofwat, stressing: “Customers will not pay twice for investment that has already been funded through customer bills.”
She added that Thames Water has been “very open about the challenges of delivering all the elements” of its programme, “which has been impacted by cost increases that are higher than the inflation index applied to our allowances”.
Liberal Democrat MP Charlie Maynard said the investigation was the “last nail in the coffin” for the firm, adding: “Customers across London and the South East deserve better.”
“The Government has a choice to do the right thing and put this failing company into special administration,” he said.
