Northumbrian Water told to pay £20.3m back to customers for failing to meet targets


Northumbrian Water will be hit by a financial penalty after customers were left cut off for days after Storm Arwen.

Ofwat, the body that regulates water in England, has published a draft report on how prices should be adjusted to reflect the performance of water suppliers around England and Wales.

The report concludes that Northumbrian Water should pay back a total of more than £20m to customers due to its performance.

Read more: Northumbrian Water pays first dividend in three years

An Ofwat spokesperson told ChronicleLive the main targets were missed on water quality compliance and cuts to the water supply. If its recommendations are approved, Northumbrian Water will take a total of £20.3m off customers’ bills.

In total, 11 water companies in England and Wales face financial penalties, of those 11 Northumbrian Water faces the fourth highest hit, at £20.3m.

Northumbrian Water has a chance to respond to the consultation ahead of a final ruling on November 15.

Northumbrian Water says the penalty is mostly in relation to the impact caused by Storm Arwen in late 2021. The storm left homes in parts of Northumberland and County Durham without power and water for days.

Northumbrian Water had asked Ofwat to exclude the Storm Arwen period from its analysis on water supply issues as the impact of the storm was “beyond anything it could have reasonably prepared for”. Or what refused.

Ofwat’s report reads: “We consider that loss of supply is perhaps the most serious water service failure, especially for vulnerable customers. The impact for customers of these service interruptions was severe. Northumbrian Water saw up to 8,000 properties interrupted, with around 1,200 without water up to 45 hours later.”

Northumbrian Water regulation and assurance director Andrew Beaver said: “Our levels of customer service and environmental impact are among the best in the industry. This is demonstrated by the four star rating the Environment Agency gave us earlier this year.

“Ofwat’s draft decision however, proposes a significant financial penalty. This is almost entirely driven by what happened during Storm Arwen in late 2021, when extreme weather conditions in our operating areas led to widespread power outages. Despite the large-scale multi-agency response some customers experienced temporary interruptions to their water supply.

“We expected that Storm Arwen would have been deemed an extreme weather event and not included in their draft determination, however Ofwat has rejected this proposal in its draft decision.

“We are very surprised by Ofwat’s draft decision and will be responding to the consultation in due course. We will keep customers informed of the outcome.”

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