Ratings for England’s water companies have fallen to record lows, with Thames Water named the worst-performing supplier, as the Environment Agency revealed a surge in sewage pollution last year.
Eight of the nine companies were rated as poor or requiring improvement, with a cumulative score of just 19 out of 36 stars – the lowest since the star rating system began in 2011.
Only Severn Trent achieved full marks, despite being responsible for 62,085 sewage spills averaging seven hours each in 2024. Thames Water, however, was the sole company awarded just one star, after its serious pollution incidents more than doubled from 14 to 33 in 2023-24.
Thames Water is struggling to secure its future amid mounting debt and criticism over decades of underinvestment. The company has faced scrutiny for paying large dividends while failing to maintain leaking pipes and failing treatment works.
The report attributes the sector’s poor performance to a combination of wet and stormy weather, underinvestment in infrastructure, and increased monitoring and inspections. Ofwat’s performance review highlighted that pollution incidents remain unacceptably high, with only two companies reporting a reduction over the last five years.
Despite promises to cut sewage spills by 30% between 2020 and 2025, companies saw a net 27% increase in incidents. The report states: “Companies achieved a reduction of 15% in the first three years, but the increase in the final two years has led to an overall 27% increase in numbers across the 2020-25 period.”
Environmental campaigners have criticised the star rating system, saying it allows companies to claim top marks even while illegally discharging sewage. Some bosses have used high ratings to justify large pay packets, while companies responsible for pollution could still present themselves as “industry leaders.”
The Environment Agency plans to replace the star system in 2027 with a numeric scale from one to five. Only firms meeting the highest standards across all metrics will be rated “excellent,” while the worst performers will be classified as “failing.”
Alan Lovell, chair of the Environment Agency, said: “This year’s results are poor and must serve as a clear and urgent signal for change. What is needed now from every water company is bold leadership, a shift in mindset and a relentless focus on delivery. We will support them however we can but will continue to robustly challenge them when they fall short.”
Companies are assessed on seven metrics, including drought resilience and transparency over sewage spills. Experts warn that firms scoring highly in some areas can still receive top marks while discharging large volumes of untreated waste into rivers and seas.
Severn Trent’s four-star rating has previously been cited to justify executive pay, with former chief executive Liv Garfield receiving £3.2m, including a £584,000 bonus, even after a £2m fine for releasing 260 million litres of sewage into the River Trent.
This week, chancellor Rachel Reeves announced plans to focus regulators on supporting business growth rather than enforcement. The government intends to introduce growth targets, publish a league table, and overhaul the sector by replacing Ofwat with a “super regulator” merging existing powers.
Campaigners remain sceptical, noting that privatisation has allowed companies to pay large dividends and executive bonuses while failing to invest sufficiently in sewage infrastructure, raising concerns over public and environmental safety.
