Yorkshire Water blames severe weather for lower environmental performance
Yorkshire Water has highlighted the extreme weather of the last 12 months as it recorded a “disappointing” drop in its environmental performance.
The company has released its annual report and financial statements for the year ending March 31 in which revenues increased 7.2% to £1.227bn, though operating profit stayed broadly flat at £236.6m due to rising costs.
The annual report has been released just a week after Yorkshire Water was one of three UK water suppliers highlighted by industry regulator Ofwat for failing to manage sewage spills. The company is likely to be fined £47m over what Ofwat called a “catalogue of failure by Thames Water, Yorkshire Water and Northumbrian Water in how they ran their sewage works and this resulted in excessive spills from storm overflows.”
In the report, Yorkshire Water chair Vanda Murray said the company has seen “consistent improvement” on most of its key performance measures, but chief executive Nicola Shaw highlighted how bad weather during the year had hampered the firm’s environmental efforts.
She said: “Given the weather across our winter, our environmental performance in the 2023 calendar year (and since then into the 2024 calendar year) is substantially below the levels we want to achieve. To reduce both flooding and pollution incidents, we are investing to improve the resilience of our networks to severe weather events.
“The severe weather contributed to an increased number of discharges from our combined sewer overflows, as well as increased pollution incidents. The increase in numbers has contributed to a drop in our Environment Performance Assessment rating for the 2023 calendar year.
“This is disappointing, however, we are confident that our previous investment in our network, immediate operational response and prior partnership working reduced the overall impact of severe weather for our customers and the environment.”
Ms Shaw also highlighted how the company’s investors had repaid £400m of an outstanding intercompany loan last June to improve the company’s financial position, repaying a further £100m after the end of the financial year. The company’s financial statements outline a £84.1m dividend to its parent company, Kelda Holdings, but said none of that had been paid out to shareholders.
Last month, Ofwat said it would allow Yorkshire Water to increase customer bills by an average of £107 a year by 2030 to support investment of £7.3bn over a five-year period. That was 11% lower than the company had requested, but Ofwat said the rise would fund Yorkshire Water to reduce storm overflow spills by 42%, as well as delivering other environmental measures.