Dŵr Cymru Welsh Water is reporting that it has made good progress on reducing phosphorous in rivers, according to the company’s financial results for 2023/24.
The water company has spent £483 million to maintain and improve its assets in the last 12 months to improve services to its customers and communities and to protect the environment.
The investment includes seven investment schemes (totalling £53 million) to help improve the quality of the River Wye which have been completed ahead of schedule as well as good progress being made on the River Teifi and other SAC (Special Areas of Conservation) Rivers.
Welsh Water is planning to invest £557 million during 2024 to 2025, the last year of AMP7. The company will have invested £2.0 billion over the whole of AMP7 – this includes £80 million which Welsh Water says has been made possible by its not-for-shareholder status enabling it to reinvest into the business what would otherwise be paid out as dividends. This will be £165 million when these projects are complete.
If Welsh Water’s AMP8 business plan the utility submitted to Ofwat gets the go-ahead from the regulator, the upcoming 5-year regulatory period starting in April 2025 would see it make its highest-ever planned investment of over £4 billion.
Additional investment was committed specifically by Welsh Water to reduce phosphorous in the five failing Special Area of Conservation (SAC) rivers – the Wye, Usk, Teifi, Cleddau and Dee rivers. Its not-for-shareholder business model has allowed it to accelerate this programme by an extra £100 million. In addition, Welsh Water has confirmed it has agreed 145 new environmental permits with Natural Resources Wales to reduce phosphorous at its treatment works and other assets to improve river water quality.
The company will spend £840 million in the five years to 2025 (AMP7) and a further £2 billion proposed between 2025 and 2030 (AMP8) to improve its wastewater network and protect the environment (subject to approval from Ofwat).
In total, Welsh Water has completed 50 major capital £1 million-plus schemes in the year, across its network (both waste and clean water) to improve its service to customers and lessen the impact on the environment.
The company’s financial results also restate the company’s sound and stable financial position, with the highest credit ratings in the sector and low levels of gearing compared to the rest of the sector.
Chair of Glas Cymru, Alastair Lyons, said:
“Our strong financial position has allowed us to maintain our focus on improving our services to our customers and communities and delivering on our promises to reduce our impact on river water quality. Our plans have to find the right balance of being financeable, deliverable and affordable for our customers without storing up problems for future generations. Whilst there’s still much more to do, we are making good progress against the commitments we’ve made.”
Company will continue to deliver on promises set out in Manifesto for Rivers in Wales in 2024-25
Last year, the not-for-profit company published its ‘Manifesto for Rivers in Wales’ outlining how it would be investing to improve river water quality in its operating area. Looking to 2024/25, the company said it will continue to deliver on the promises set out in its Manifesto.
In May Welsh Water took a further step towards starting work on its brand new £20 million wastewater treatment works for Cardigan by submitting its plans for planning approval.
The significant scheme, which is set to start in April 2025, will provide increased capacity at the works and materially reduce the number of discharges from the site, in turn benefiting the River Teifi. The company has also confirmed investment in its wider network across the Teifi catchment which will include spending over £5 million on three treatment works by the end of March 2025.
As well as investing in conventional engineering solutions, the company is also progressing with delivering green infrastructure to improve river water quality. At New Inn near Pontypool, a £13 million scheme has just got underway which is set to become the first of its kind in the UK.
The project will create a 1.8-hectare wetland for the local community that will also serve as a green filtering system for stormwater discharged from the nearby storm overflow during heavy rain. Once completed, the stormwater will pass through the wetland before it is released into the Afon Lwyd which will help improve the quality of the river and also the main water body it flows into, the River Usk.
Welsh Water Chief Executive, Peter Perry, said:
“We’re delighted to be creating this innovative wetland that will mitigate the effects of wastewater from a storm overflow by naturally removing the phosphorus. In line with Welsh Government policy, we are prioritising investment in the storm overflows that cause environmental harm rather than those which spill the most. Our investment in our wastewater system – which will total £1.4billion in the decade to 2025 - has delivered real improvements and helped ensure Wales has over a quarter of the UK’s Blue Flag beaches while only having 15% of the coastline and that 44% of our rivers and waterbodies meet good ecological status. We have a lot more work to do and we look forward to Ofwat’s Draft Determination on our Business Plan for 2025-30 expected in July which could bring record levels of investment to tackle the issues our customers are concerned about.”