Thames Water’s crisis deepened when it was hit with a proposed £104 million fine for a “catalogue” of sewage failings.

Regulator Ofwat also hit Yorkshire Water and Northumbrian Water with fines of £47 million and £17 million respectively.

Thames Water has been struggling with debts of £14.7billion.

It announced last month it only had enough cash to fund operations until the end of May 2025.

Thames Water, Britain’s largest water supplier, has been handed the penalty by regulator Ofwat just weeks after warning it only has enough money to survive until May 2025.

The regulator can fine companies up to 10% of their annual sales. 

In the case of Thames Water, the proposed fine is 9% of sales, which Ofwat CEO David Black said “reflects the severity of the offences”.

He added: “Ofwat has uncovered a catalogue of failure by Thames Water, Yorkshire Water and Northumbrian Water in how they ran their sewage works and this resulted in excessive spills from storm overflows.

“Our investigation has shown how they routinely released sewage into our rivers and seas, rather than ensuring that this only happens in exceptional circumstances as the law intends. 
“The level of penalties we intend to impose signals both the severity of the failings and our determination to take action to ensure water companies do more to deliver cleaner rivers and seas.”

Customers of struggling Thames Water could face a 22% increase in their bills over the next five years after the industry regulator limited a larger rise proposed by the company.

The latest batch of fines, which total £168 million, form part of a broader investigation into the entire water sector, as eight other suppliers remain under investigation.

The fines, which will be consulted on, come amid rising spills from storm overflow outlets, which are only supposed to be used in “exceptional circumstances” to prevent sewage backing up from drains in heavy rain.

But untreated wastewater was released into England’s rivers and seas for more than 3.6 million hours last year.

Charles Watson, chairman and founder of campaign group River Action, said: “Last year sewage was discharged across England, Northern Ireland, Scotland and Wales more than 596,666 times.

“That’s over 1,600 times a day – and with many of these discharges being illegal, this situation is completely unacceptable.”

He said the regulator was “finally waking up to the scale of the public’s outrage” and starting to impose meaningful penalties, but said the £168 million was against a backdrop of more than £1.4 billion handed to shareholders in dividends last year.

“Until the ability of these polluting companies to hand out so much cash is severely curtailed, pollution will continue to be a highly profitable activity with inadequate incentives for the water companies to fix their creaking infrastructure and stop filling our rivers with raw sewage,” he said.

A Thames Water spokesman said: “We have been notified by Ofwat that it has reached the next stage in its investigation on our management of wastewater treatment works and our sewer network.

“We take this matter very seriously and have cooperated at every stage of Ofwat’s investigation.

“We regard all untreated discharges as unacceptable, even when they are permitted, and are taking action to improve the health of our rivers as a key area of focus and investment.

“This is the latest stage in the investigation process and we will continue to cooperate fully.”

A Yorkshire Water spokesman said: “We take our responsibility to protect the environment very seriously.

“We are disappointed with Ofwat’s response to their investigation into our wastewater treatment networks. Since the start of this process in November 2021, we have cooperated fully with the investigation and we will continue to seek clarity on their Draft Penalty and Enforcement notice. We will be responding to the notice by Sept 10.”

A Northumbrian Water spokesperson said it was “very disappointed” by the decision and did not “recognise some of the standards of compliance that Ofwat is enforcing”.

They added: “These are a departure from its previous practice and appear inconsistent with those of the Environment Agency and the government and with Ofwat’s own practice in the past.

“We’re working really hard to continue to deliver for customers and the environment and will continue to comply with and exceed government regulations.”