Welsh Water to deliver net zero carbon emissions by 2040

Alongside its annual results for 2020-21, Dŵr Cymru Welsh Water, the first, and still the only, not-for-profit utility company in Wales and England has announced that it plans to achieve net zero carbon emissions by 2040.

As one of Wales’ highest energy users with an annual energy bill of £46 million, the commitment will play a key role in combating the climate change crisis declared by Welsh Government and its goal to achieve net zero carbon emissions by 2050.

Welsh Water, which serves over three million people across most of Wales and some adjoining parts of England, relies heavily on energy to deliver its essential services. It currently generates 23% of its own energy needs through wind, hydro, solar and advance anaerobic digestion (AAD) with the rest procured from 100% renewable energy resources. The company plans to be
35% energy self-sufficient by 2025 and will invest a further £21 million to achieve this over the current regulatory investment period to 2025, ultimately becoming 100% energy self-sufficient – or energy neutral – by 2050.

As well as committing to becoming carbon neutral by 2040, the company aims to reduce total carbon emissions by 90% by 2030. To transform water and wastewater services, the company has set aside a record budget of over £80 million for research and innovation over the next five years.  Between now and 2040 it plans to innovate how it harnesses nature through its biodiversity plan, peatland restoration, wetland treatment and catchment management.

To provide detailed oversight of the strategy we have developed to deliver these objectives, and of the measurement and reporting of our progress against it, the Board has formed a new committee – the Environmental, Social, & Governance (ESG) Committee – chaired by Non-Executive Director, Debra Bowen Rees.

Welsh Water will also increase the use of renewables to become more energy self-sufficient.  Building on the success of its flagship £36 million energy park in Wrexham, North Wales, the company has recently invested £50 million into Cog Moors Wastewater Treatment Works in the Vale of Glamorgan. This will generate clean, green energy from sewage through its state-of-the- art Advanced Anaerobic Digestion (AAD) facility, creating enough energy to power the works which will make it an energy neutral site.

The company’s ambitious plans coincide with its twentieth anniversary since being set up with its sector unique ‘non-shareholder’ ownership model. This model has resulted in its customers benefiting from more than £440 million – money that would have been distributed to shareholders in other companies – through additional investment in its services and supporting more than 127,000 customers to pay their water bills with our social tariffs scheme. As it already works with food banks and other agencies to promote the support it provides vulnerable customers, Welsh Water is marking this latest anniversary by donating £1,000 to over 100 different Trussell Trust foodbanks across Wales and Herefordshire.

Glas Cymru Chairman, Alastair Lyons, said: “Today marks a significant moment for Welsh Water, as we announce our journey to achieving net zero carbon emissions by 2040. This is more than a target in relation to infrastructure or operational emissions: rather it’s about changing the way we think, plan and deliver. As one of the flagship companies in Wales, it’s about taking responsibility for managing the biggest challenge of our time in terms of climate change, focusing on the long-term and ensuring we help protect our customers, communities and the wider environment and create a better future for generations to come.” 

Welsh Water Chief Executive, Peter Perry, said: “We have faced an unprecedented, challenging year in responding to Covid-19 but we have shown resilience and adapted the way we operate and provide our essential services.

“As a company owned on behalf of our customers, we are rooted in the communities we serve. Our not-for-profit operating model continues to benefit our customers and communities and we are proud to announce our ambitious environmental plans to ensure that we can continue to provide an effective, resilient and affordable service for decades to come.”

The announcement to achieve net zero carbon emissions comes as the company publishes its Annual Results for 2020-21, showing that it invested nearly £1 million a day in its water and wastewater services (£353 million in 2020-21) – with £44 million invested in environmental improvements during this period which will help protect the quality of rivers and coastal waters around Wales.

Welsh Water also confirmed that it has incurred additional costs of £34 million to help deal with the Covid-19 pandemic and protect public health while supporting 5,000 household customers in financial need, temporarily suspending payments for approximately 45,000 businesses which closed for a period due to the Government’s social restrictions.