Severn Trent blames weather for massive water losses
Friday 27th May 2011, 10:17AM BST.
Severn Trent today said it failed to meet its annual leakage target after the coldest December in 100 years caused a surge in the number of broken pipes.
The water company, which serves eight million customers in the heart of the UK including Shropshire, matched last year’s leakage performance but failed to meet regulator Ofwat’s reduced benchmark of 483 megalitres per day for 2010/11.
It blamed its first above-target leakage performance for five years on two periods of freezing temperatures followed by a thaw and pledged to invest more money to make its system more resilient this year.
The group reported that underlying profits fell by 14.7 per cent to £288.6 million in the year to March 31, with revenues in its regulated water business up 0.3 per cent to £1.4 billion after Ofwat imposed a 0.7 per cent drop in prices. The regulator has the power to fine firms that fail to meet leakage targets.
Tony Wray, chief executive of Severn Trent, pointed out the company had volunteered a lower leakage target than the one proposed by Ofwat.
He said: “It was the coldest December for 100 years and the outbreak of burst pipes was pretty huge. We kept our leakage as low as last year, which was a record low for us.”
Severn Trent does not currently expect to impose hose pipe bans on customers despite the “unseasonably dry” weather, he added.
But the firm will monitor the situation and encourage customers to use less water.
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