April 2 (Reuters) - Thames Water is poised to reach an agreement with water regulator Ofwat that will allow Britain's largest water supplier to avoid new fines until 2030, the Financial Times reported
Britain's Ofwat planning to waive Thames Water fines to 2030, FT says
Thames Water's Prospective Pact with Ofwat and Implications
April 2 (Reuters) - Thames Water is expected to reach a pact with regulator Ofwat for Britain's largest water supplier to avoid new fines until 2030, the Financial Times said on Thursday, citing people familiar with the matter.
Details of the Rescue Deal
The water regulator plans to accept "undertakings" instead of financial penalties as part of a rescue deal currently under discussion with the company and senior creditors, the newspaper said.
Changes to Performance Targets
Performance targets on pollution, leakage and other areas will either be suspended or significantly modified, it said.
Ongoing Legal and Regulatory Risks
Thames Water still faces Environment Agency fines and legal cases, the FT added, without specifying the size of the fines.
Consultation and Verification
Public Consultation Requirement
Ofwat must put any deal out for a three-month public consultation, the newspaper said.
Company and Regulator Responses
Reuters could not immediately verify the report. Thames Water, which has been at the centre of a sewage scandal in Britain, did not respond to a request for comment.
Ofwat did not comment on the FT report, but said it is engaging with London & Valley Water and reviewing its plans to improve operational performance and financial resilience for customers and the environment.
Financial Background and Potential Outcomes
Thames Water's Financial Struggles
Thames Water, which has 16 million customers, has been fending off financial collapse since 2023 as it grapples with debt of nearly 20 billion pounds ($26.47 billion) in a sector where the regulator limits price increases.
Proposed Financial Support
As part of the rescue deal being discussed, a group of the company's creditors has offered 3.35 billion pounds of new equity and up to 6.55 billion pounds of new debt.
Potential for Nationalisation
Without an agreement between the regulators and the creditors, Thames Water is likely to end up in the government's special administration regime, a form of temporary nationalisation.
Exchange Rate Information
($1=0.7556 pounds)
Reporting Credits
(Reporting by Chandni Shah, additional reporting by Disha Mishra in Bengaluru; Editing by Clarence Fernandez and Jan Harvey)
