The problems arose in 2007 with a spike in failures during 2008 and 2009. This prompted Ofwat’s investigation into DCWW’s understanding and management of its assets, and its management of contractors delivering services on its behalf.

“During the year, we carried out an investigation. As part of this investigation, we engaged an independent third party to review the company’s systems and processes,” said Ofwat’s latest Service and Delivery report.

DCWW has brought the operation of its assets, which was previously outsourced, back in house. It is also strengthening its systems and processes, and making sure it has a full understanding of its assets.

“They began that improvement work in 2009/10 and there has been improvements in performance but it requires another year’s worth of similar performance for Dŵr Cymru to be ranked stable in this area,” said an Ofwat spokesman.

A DCWW spokesperson said: “The investigation was in respect of a period when the operations of our assets were largely outsourced. We are satisfied that our systems and processes are appropriate to the need of our business.”

The Ofwat report also highlights managing leakage as an “area for concern”, with six water companies failing leakage targets in 2009/10

Ofwat is still investigating Yorkshire Water’s leakage failure and will monitor the six companies.

The regulator said the water and sewerage sectors performed well in delivering services to consumers while protecting the environment. This was despite tough operational conditions caused by extreme weather. It said all water companies achieved their targets to ensure appropriate supply levels to meet customers’ needs and met their leakage targets in 2008/09.

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