Southern Water has been hit with a record £126m punishment for failing to operate some of its sewage treatment sites properly and for deliberately misreporting its performance.
The penalty will see customers get a rebate of at least £61 each over the next five years.
“What we found in this case is shocking,” said Rachel Fletcher, the head of water regulator Ofwat.
Southern boss Ian McAulay said: “We are deeply sorry. There are no excuses.”
Under the agreement with Ofwat, each customer will receive at least £17 in 2021 and at least £11 per year for the following four years.
Southern will pay a total of £123m to customers, as well as a fine of £3m.
Southern’s failings included not making the necessary investment, which led to equipment failures and spills of wastewater.
Ofwat also found that the company manipulated its wastewater sampling process, which meant that it misreported information about the performance of a number of sewage treatment sites.
As a result, it avoided penalties under Ofwat’s incentive regime.
Ms Fletcher said the findings showed “the company was being run with scant regard for its responsibilities to society and the environment”.
“It was not just the poor operational performance, but the co-ordinated efforts to hide and deceive customers of the fact that are so troubling,” she added.
Mc McAulay added: “We have clearly fallen far short of the expectations and trust placed in us by our wastewater customers and the wider communities we serve.
“We are fully committed to the fast pace of change delivered since 2017. There is a lot more work to do but we’re pleased that this proposal agreed with Ofwat enables us to fully make amends to our customers and regain their trust as quickly as possible.”
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