Pennon Group PLC's (LSE:PNN, OTC:PEGRY) South West Water and Anglian Water have been fined by water regulator Ofgem after it found both had breached legal obligations around wastewater treatment.
South West Water has been hit by a £24 million enforcement package for the benefit of the environment and its customers.
Anglian, which is owned by a consortium including IFM Investors, Igneo, GLIL and Canada Pension Plan, faces a £62.8 million package.
Investigations by Ofwat found the pair "failed to operate, maintain and upgrade their wastewater assets adequately to ensure they could cope with the flows of sewage and wastewater coming to them".
Lynn Parker, senior director for enforcement at Ofwat, said the investigations found the operational failures for Anglian and South West "resulted in excessive spills from storm overflows".
"These are serious breaches and are unacceptable," she said.
"We understand that the public wants to see transformative change. That is why we are prioritising this sector-wide investigation which is holding wastewater companies to account for identified failures."
Both companies accepted they got things wrong, she added, and are focused on taking action to put things right.
South West's enforcement package includes investing £20 million to reduce discharges at key overflows, especially in sensitive and community areas, which Ofwat said would bring forward benefits previously planned for the 2030-35 period.
The FTSE 100 company's subsidiary also must pay £2 million into a new fund to tackle "sewer misuse and misconnections", supporting plumbing repairs, community outreach, funding surveys, enforcement and technology to improve detection; plus another £2 million for a new Nature Recovery Fund to back biodiversity projects, river quality work, and local initiatives like rainwater storage, tree planting, and pond creation.
Anglian's includes £57 million investment to remove, attenuate or optimise wastewater flows, and £8.5 million for a community fund