Prime Highlights
- South West Water will spend £24m on environmental and sewage work instead of forking out £19m in fines.
- The deal follows the utility giant being found to have broken serious offences of sewage discharge.
Key Facts
- The cash will see £20m invested in lowering storm overflows, £2m invested to correct sewer abuses, and £2m invested to give community environmental grants.
- The deal is to be brought out into the open for public consultation before the deal is final.
Key Background
South West Water, which serves Cornwall, Devon, and Somerset, and the surrounding area, was attacked after two years of Ofwat, the UK water industry regulator, pushing them to come up with illegal sewage releases, not upgrading equipment, poor monitoring, and poor response systems—problems of serious environmental and public health consequences.
Rather than a level £19 million investment, South West Water proposed a £24 million investment plan to get itself back on course in services. Ofwat accepted this proposal, which includes particular commitments for reducing storm overflow occurrences by 2025, mending sewer misconnection issues, and funding local environmental action groups.
The regulator contends that this will be more tangible and faster in its impact on consumers and the environment than a traditional fine. The move has, however, not been without controversy, with environmental activists calling it an obscure step that dilutes accountability. The opponents have contended that the deal enables firms to exchange reputation-repairing strategies for actual punishment, and hence dilute regulatory power.
The action is criticized, but the Ofwat leadership explained that the focus point remains a matter of achieving long-term environmental gain. Public consultation before finalizing the investment strategy will be undertaken. This is within a wider regulatory picture, with Ofwat recovering over £160 million in penalties and investment promises from some UK water firms for the same environmental breaches.
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