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Ofwat has put a record 10 companies including Thames Water, Southern Water and South East Water on its financial watch list, which involves closer monitoring by the regulator.
Thames Water, which has warned it may run out of cash by the new year, is the most at risk, but Southern Water and South East Water also remain on the “action required” list, according to Ofwat’s latest annual Monitoring Financial Resilience Report published on Thursday.
Seven other companies including Affinity, Portsmouth, Northumbrian and Yorkshire Water remain in the “elevated concern” category, Ofwat said.
Companies on Ofwat’s financial watch list are more closely monitored by the regulator and may be required to take action such as raising equity and debt to ensure they can deliver their investment plans.
Water companies have come under pressure from rising chemical, labour and energy costs, as well as higher financing costs on their debt. Borrowing in the sector increased from £68.3bn in March 2023 to £74.5bn in March 2024.
This is a developing story
