England’s Water Companies14 Years of Environmental Performance

The Environment Agency’s Environmental Performance Assessment (EPA) is the definitive measure of how well England’s water companies protect the environment. Every year since 2011, the EA has rated all nine water and sewerage companies on pollution incidents, permit compliance, self-reporting, and delivery of environmental programmes. The results paint a troubling picture: after modest gains during 2016-2020, the sector has entered a period of sustained decline.

The 2024 results mark a new low. With a sector average of just 2.11 stars out of 4, it’s the worst year in the 14-year dataset. Only Severn Trent Water achieved the top 4-star rating. At the other end, Thames Water—serving 15 million customers across London and the Thames Valley—fell to just 1 star, recording 33 serious pollution incidents in a single year.

How Performance Has Changed Over 14 Years

The sector’s trajectory shows three distinct phases. During AMP5 (2011-2015), performance was stable but unremarkable, averaging 2.78 stars. AMP6 (2016-2020) brought improvement, peaking at 3.33 stars in 2020—the only year when the sector average exceeded 3 stars. But AMP7 (2021-2024) has been characterised by collapse: the average fell to 2.47 stars, with 2024 hitting rock bottom at 2.11.

The exceptional 2020 result may be partially explained by reduced water demand during COVID-19 lockdowns, which eased pressure on sewerage infrastructure. The rapid deterioration since then suggests the underlying problems were never addressed—they were simply masked by unusual circumstances.

Company Rankings: Best to Worst

Performance varies dramatically across the nine companies. Severn Trent Water stands out as the clear leader, with a 14-year average of 3.50 stars and 9 years at the top 4-star rating. At the opposite end, South West Water and Southern Water have the worst track records, each averaging below 2.15 stars and recording multiple 1-star years.

The heatmap reveals patterns that averages obscure. Wessex Water achieved 4 stars seven times but has slumped to 2 stars in three of the last four years. United Utilities shows similar volatility—four 4-star years but dropping to 2 stars in 2024. Only Severn Trent has maintained consistent excellence, never falling below 3 stars in the entire dataset.

The 2024 Crisis in Detail

The 2024 results reveal a sector-wide failure. Seven of nine companies received just 2 stars. Thames Water’s collapse to 1 star is particularly significant given its scale—it serves more customers than any other English water company. Its 33 serious pollution incidents represent more than the combined total of the next three worst performers.

New Regulatory Requirements from 2026

The government has responded to the sector’s declining performance with the Water (Special Measures) Act 2025, which introduces mandatory Pollution Incident Reduction Plans (PIRPs). From 1 April 2026, every water company must publish an annual plan setting out how they will reduce pollution incidents, with the first implementation report due by 1 April 2027.

The PIRP framework represents a fundamental shift in accountability. Companies must now demonstrate not just what went wrong, but why—and provide credible plans to prevent recurrence. For companies like Thames Water with 33 serious incidents, or South West Water with 108 total incidents, the burden of proof will be substantial.

The standardised measures that PIRPs must address include telemetry installation, predictive analytics, proactive maintenance, power resilience, and customer engagement to reduce blockages. Companies are also required to demonstrate “cultural change”—business-wide behavioural improvements that address the systemic causes of pollution.

Hypothetical PIRP Penalty Exposure Based on 2024 Incidents

While the PIRP requirements don’t take effect until April 2026, applying the new enforcement framework to 2024 incident data provides a useful illustration of the financial exposure water companies now face. Based on Environment Agency penalty benchmarks and recent case law—including Southern Water’s £90m fine in 2021—we estimate the sector’s total penalty exposure from 2024 incidents alone could range from £150 million to £400 million.

What This Means for AMP8

As the sector enters AMP8 (2025-2030), the combination of historically poor performance and new PIRP requirements creates unprecedented pressure. Companies face a choice: invest significantly more in infrastructure and operations, or risk escalating regulatory enforcement and potential criminal prosecution of senior executives.

The 14-year EPA dataset suggests that incremental improvements won’t be sufficient. The sector achieved its best result in 2020 at 3.33 stars—still below the 4-star standard that only one company now meets. For the seven companies currently at 2 stars, reaching that level will require transformational change, not just marginal gains.

With public and political scrutiny at unprecedented levels, the water industry faces a defining period. The data is clear: performance has declined significantly since 2020, serious pollution incidents remain too common, and only one company demonstrates that excellence is achievable. The question now is whether the rest of the sector can close the gap before the new enforcement regime takes full effect.