The UK government's new plans for the water sector have been roundly criticised for recycling old pieces of legislation, though there is £1.6bn of new funding for water companies to help speed their investment in infrastructure.
Water companies will "face bigger penalties if they break the law", the plan from the Department for the Environment, Food and Rural Affairs (Defra) said, while also pledging to fund more inspections and set new targets for the Environment Agency’s oversight of water companies.
Fines from water companies will be reinvested into a new Water Restoration Fund, "making polluters pay for damage they cause to the environment", the policy paper said.
There are three listed water firms in the FTSE 100, Pennon Group PLC (LSE:PNN, OTC:PEGRY), which owns South West Water and Bristol Water, Severn Trent PLC (LSE:SVT) and United Utilities Group PLC (LSE:UU.)
More investment is needed from water companies, Defra said, along with stronger regulation and tougher enforcement for polluters, with measures designed to tackle "every source of pollution", including from storm overflows, agriculture, plastics, road run-off and chemicals – as well as pressure on water supplies from hotter, drier summers and growing populations.
There was a commitment to consult on a ban on the use of plastic in wet wipes, though this saw criticism from environmental campaigner Feargal Sharkey, who said the promises about wet wipes have "been made three times in the last five years [and] nothing happened".
The proposals also included new restrictions on the use of ‘forever’ chemicals (PFAS), which have been shown to be toxic to humans and wildlife, as well as building up over time due to their inability to break down easily.
It was noted that delivering significant new investment in infrastructure to stop storm overflow releases of untreated sewage "could cost up to £600bn, increasing annual water bills up to around £820 per year by 2049".
The paper said water companies will invest just under a tenth of this, £56bn, and have over 25 years to do so.
Sooner than that, water companies will need to install event duration monitors on all storm overflows by the end of 2023, up from 90% last year, with "over 800 improvements" to storm overflows in England by 2025 and with the 15-mile-long Thames Tideway Tunnel ‘super sewer’ also due to be completed in 2025.
Permits issued to water companies for storm overflows will also be tightened, Defra said, while one of its consultation will examine whether to make water companies statutory consultees on certain planning applications.
There will be £34mln of grant funding to improve slurry infrastructure for farmers, with further rounds to be launched later in 2023 and 2024.
Wet wipes could be banned under plans to clean up England's water supplies.
However, @Feargal_Sharkey tells @kategarraway and @richardm56 that the govt's whole statement is 'muddled and confused.'
He adds that it's the third time the govt has made the announcement about wet… pic.twitter.com/uHR99hiXxm
— Good Morning Britain (@GMB) April 4, 2023