Today (28 May 2025) Thames Water was issued with another record fine by the Water Services Regulation Authority (Ofwat) over the company's environmental breaches for failing to operate and manage its water and sewage treatment network effectively, which resulted in several sewage pollution incidents.
The regulator conducted two investigations, one into environmental pollution and another into dividend payments, and concluded that Thames Water had "failed to protect the environment". The company was fined £104.5 million for breaches related to wastewater operations, and an extra £18.2 million for breaking rules related to dividend payments, which is a first fine of this kind issued by Ofwat.
Those fines underscore ongoing concerns about Thames Water's appalling environmental compliance over the recent years and the management of its infrastructure. The company's repeated violations have led to increased scrutiny from regulators and the public, with recent calls for substantial reforms of the water industry.
In October 2024, Thames Water was ordered to pay £56.8 million in penalties for underperformance, including environmental pollution, leaks and poor service to the customer, and just months earlier, in July 2024, the company was fined £38.6 million over missing 21 regulatory targets in areas such as pollution and supply interruptions.
Ofwat's chief executive, David Black, said: "Our investigation has uncovered a series of failures by the company to build, maintain and operate adequate infrastructure to meet its obligations.
"The company also failed to come up with an acceptable redress package that would have benefited the environment, so we have imposed a significant financial penalty."
The regulator stated that the most recent fine will be paid by the company and its investors and will not be passed on to customers.
Over the past few years, many water companies faced public outrage over the extent of the environmental pollution as well as a lack of investment in new infrastructure, with rising bills and excessive dividends and executive bonuses paid by the private companies to their shareholders. In recent weeks, Thames Water secured a survival loan of £3 billion to rescue the company that has an estimated £19 billion of debt.
Just weeks before the record fine was imposed, Thames Water had entered discussions with Ofwat about implementing a "turnaround regime" aimed at breaking a cycle in which financial penalties prevent the company from making necessary improvements.
Since 2016, the company has been fined over £250 million by the Environment Agency and Ofwat for various breaches.
