Water company loses appeal against heavy fine

Environmental catastrophe

Over the course of a six-day period in 2012, untreated sewage was discharged from a pumping station owned by Thames Water Utilities Ltd (TW) into the Chase Brook near Newbury. The pollution incident caused high levels of ammonia and e-coli and low oxygen, damaging aquatic life along a 600-metre stretch. The effects were particularly damaging as the stream runs through an area of outstanding natural beauty.

What caused it?

The purpose of the pumping station was to collect raw sewage and pump it onwards to a sewage treatment works. There were two pumps within the wet well but both failed when they were clogged by “rag” , e.g. plastic, nappies or other large items, within the sewage. When both pumps failed, the level in the wet well overflowed, causing the illegal discharge.

Preventive measures

The rag problem which affected the pumps is a common occurrence in the industry. To reduce the risks, wet wells are equipped with a system which sends an alarm signal in the event of pump failure or unexpected level increase. In TW’s case the station sent multiple alarms on 29 August 2012 and 4 September 2012. But there was no response until the pollution was noticed by a member of the public. According to the water company’s own procedure it should have responded within four hours of the first alarm.

Previous events

In court it was shown that the pumping station had suffered repeated failures since April 2012. There had been at least 16 instances of failure of one or both pumps within five months. This should have alerted the company that there was a major problem and prompted it to invest in higher specification pumps - as it eventually did after the damage was caused.

In court

TW pleaded guilty to breaches of the Environmental Permitting (England and Wales) Regulations 2010 . At the sentencing hearing, however, it was surprised to be given a £250,000 fine, as it expected the offence to attract a maximum fine of £150,000. It objected to the way a multiplier had been used to account for TW’s size. On appeal the court found that an even higher fine would have been justifiable. It was emphasised that guidelines on the range of fines could be stretched to ensure that a deterrent effect was imposed on repeat offenders. A fine might need to equate to 100% of a company’s pre-tax profits in order to provide a sufficient sanction.

Tip 1. Repeat offences are likely to be treated more harshly in future. If you’ve had any enforcement action in the past be ready to demonstrate what has been done to improve compliance. Ensure that environmental compliance is on the board’s agenda and that performance reports are received and minuted.

Tip 2. Courts will stretch the guidelines on fines if they think that you haven’t acted responsibly following an incident. Spend money on the clean-up and mitigation measures without being prompted. This is likely to be more than compensated for in reduced fines.