Yorkshire Water set for downgrade after failures

A series of major failures including rising pollution, missed environmental projects and declining customer satisfaction have been reported by Yorkshire Water during the past year.

The findings of its financial report, which cover performance from April 2025 to March 2026, come as the company is set to be downgraded to a one-star rating by the Environment Agency.

The firm, which increased customers' bills by 30% last April, also confirmed its chief executive Nicola Shaw received a £660,000 additional payment from its parent company.

Yorkshire Water said the past year had been "extremely challenging" and that drought followed by record rainfall had put "significant pressure" on its network.

The company's failures were reflected by the fact it was hit with an £88.8m performance penalty from regulator Ofwat for under-delivering, according to the report.

Referencing the £660,000 extra payment made by parent company Kelda Holdings to Shaw, mayor of West Yorkshire, Tracy Brabin described it as "outrageous".

Brabin said the report had shown sewer flooding had increased and targets to fix burst water mains had been missed.

She added: "This system is broken. The report, however they spin it, is shocking for our region.

"Our bills are going up and the water quality and spillages are not changing and it's always the public that pay the price.

"The investors in Yorkshire Water are not paying the price of these failures."

Giving details on pollution, the report concluded that incidents had risen by more than 70% in the last 12 months - up from a total of 151 in March 2025 to 260 in April 2026.

It said: "Our progress this year has not been as we had hoped, with more total pollution incidents than in the prior year, and the same number of serious incidents."

The company said the challenges it faced had been compounded by "extreme weather conditions", including a "prolonged drought" which left smaller rivers and streams with less water to dilute wastewater discharges.

The report also confirmed the company failed to deliver five projects in west Leeds, which formed part of a list of legally required environmental schemes.

It said customer satisfaction fell sharply after bills rose by 30% and hosepipe restrictions were introduced.

The company said it had "worked hard" to improve performance for customers.

It said it had increased support for customers facing higher living costs, providing £70m in assistance to 246,000 households and adding 80,000 people to its priority services register.

The report also highlighted areas of progress, including improved leakage performance and a reduction in storm overflow spills.

It said it had delivered several environmental schemes and was expanding its use of operational intelligence to predict and prevent pollution as part of a wider £8.3bn programme.

In response to its chief executive's additional payment, Yorkshire Water said the payment was made by shareholders in its parent company and was separate from its own performance-related pay.

In addition, the company said it was "disappointed" it would receive a downgrade in the Environment Agency's Environmental Performance Assessment from its current two-star rating when the rankings are published in October.

However, it recognised its environmental performance was "not where it needs to be and we accept there is more to do, especially on pollution".

It added: "Improvement on pollution will take time given the scale of new infrastructure that is needed, but we have the right plan in place and by 2030, we will have reduced pollution incidents and delivered significant improvements to river health."

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