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Our leakage performance

Our leakage performance

Update for January 2021

Every year, we run a ‘winter campaign’ to give our customers tips on how to protect their homes from leaks and bursts caused by cold weather. Fluctuations in temperatures cause pipes to expand and contract, leading to leaks which can interrupt water supplies or cause damage in customers’ homes. Around 25% of all the leaks we fix are at customers’ properties.

This year, we’re working with B&Q to help spread the word and encourage more customers to look after their pipes. B&Q will be sending an email to their customers with some home protection tips and the opportunity to win a voucher to spend on ‘winter ready’ products. New joiners to the B&Q loyalty scheme will also receive money-off vouchers, to give them a little extra help as they protect their homes, and we will also be putting the messages out on social media.

A customer lagging the pipes outside her house


Headlines for November 2020

  • Covid-19 continues to have an impact on our year-to-date repair plan - November leakage level at 560 Ml/d, 19 Ml/d above our internal target. However, we are 3 Ml/d closer to target compared to last month
  • Fixing more leaks - 7% increase in the number of leaks fixed compared to October - we completed 5,325 leak repairs in the month, the equivalent of 1,331 leaks fixed on average each week
  • Equivalent of 30 Ml/d of leakage prevented through leak repairs

Leakage reduction - at a glance

Monthly leakage 2020/21

ML/d Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
Monthly leakage level 546  540  535  529  545  544  551  560        
Mid-range monthly leakage forecast 577 550 535 531 527 522 526 541 589 639 638 575
Variance -31  -10  0  -2  +18  +22  +22  +19        

Year-to-date average leakage 2020/21

ML/d Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
YTD average leakage 546  543  540  537  539  540  541  543        
Mid-range YTD leakage forecast 577 563 554 548 544 540 538 538 544 553 561 562
Variance -31  -20  -14 -11   -5 0  +3  +5        

1. The figures in the above tables are operational leakage data and therefore based on information from Thames Water source systems at a point in time. This data may be subject to a data refresh on a monthly basis and for year-end reporting.

2. The figures have been updated to be consistent with the Ofwat AMP7 leakage reporting methodology.

Leakage reporting changes for 2020 to 2025

A new leakage reporting methodology has been implemented across the industry by our economic regulator, Ofwat, to better align reporting and improve transparency and benchmarking across the industry. In addition, leakage targets have also moved from an annual target to a three-year rolling average target for all companies.

The main changes made to water companies’ methodologies are outlined below:

  • The hour during the night used as the starting point for the leakage calculation is now fixed (03:00 to 04:00) and aligns with the period used to calculate allowances for night use. Previously we used the lowest hour between 00:00 and 06:00.
  • There must be three valid nights of data within a reporting week to calculate leakage compared to one night under the previous method.
  • The period during which data is unavailable now has to be infilled using trend analysis rather than using the last valid value.
  • Improvements to the methods used to calculate consumption, that were not previously able to be included to maintain consistency in approach with the method of target setting, have now been included in both our targets and reported leakage levels.

To enable this new approach, we’ve developed a tool to implement the new reporting processes needed to ensure compliance with the agreed methodology and allow employees across the company to view our latest reported leakage.

All water companies must conform to the new leakage reporting methodology by the end of 2020/21. However, we have now switched our leakage reporting over to the new methodology to ensure that we are fully aligned across the company. We moved to this reporting method for the August report following the completion of data consistency and reliability checks on our new reporting tool.

This means we are very clear in knowing exactly where we are in terms of leakage level and the levels of activity we must deliver to achieve our plan. It was important for us to get into this position as early as possible in the year, setting up solid foundations to further drive down leakage.

Conclusion of Ofwat investigation

Ofwat investigated our leakage performance in 2017. In August 2018, we agreed a package of financial and non-financial commitments with our economic regulator Ofwat under Section 19 of the Water Industry Act 1991. We refer to these as our Section 19 Undertakings.

As part of our Section 19 Undertakings we agreed to pay £120 million back to our customers. This money comes solely from Thames Water’s shareholders and is reflected in customer bills. In order to clarify and improve how we report leakage we appointed Victoria Borwick, former Deputy Mayor of London and former MP, as an independent monitor of our monthly leakage reporting. Victoria brings highly relevant experience of reporting and communicating complex matters to the public. We’re working with Victoria to provide external and independent feedback and challenge to how we engage with and improve customer understanding of our leakage targets and performance against these.

Tonia Lewis continues to fulfil the role of Undertakings Compliance Officer. This role is responsible for ensuring overall compliance with the Undertakings and providing regular updates to our Board and Ofwat. We provided Ofwat with our fifth 6-monthly review of our compliance against our Undertakings at the end of October 2020. We met with Ofwat to discuss the report and our compliance on 17 December 2020.

Risks to our plan

The two largest risks to us meeting our target in 2020/21 are the impact of the on-going Covid-19 pandemic and unpredictable weather.

The impact of current restrictions has meant our leakage activity performance is behind our original plan. We're continuing to closely monitor official guidance and review our plans quarterly so that we can adapt as official guidance changes.

Typically, the weather is the largest risk to our leakage level each year, as both extreme cold and hot conditions can increase leakage levels. To mitigate this risk, we continually review and update our leakage reduction plans against a range of short and long-term weather scenarios. We formally review our plans every three months to assess performance and identify areas where we need to undertake additional activity. This work enables us to review the resource requirements and ensure they are enough to detect and repair the number of leaks required.

Other material risks that we monitor are the effectiveness of our leak measurement models, our understanding of how our pipes react to rapid changes in weather, and our ability to pre-empt network deterioration. Our Leakage Task Force is addressing these and other questions to ensure our planning assumptions and leakage reduction strategy are effective.

To ensure effective control of the above risks, we’ve assigned senior managers to drive performance in key areas we know are challenging, such as leakage detection and repair output performance, data capture, analysis of leaks fixed and job auditing.

Get involved

You too can play an important part in helping us achieve our targets.

Feedback: We’d like your feedback on our leakage performance information. Please get in touch to share your feedback, or to discuss how we may be able to make this report more accessible for you.

Helpful links

The information provided is, to the best of our knowledge, accurate, but may be subject to change from time to time. The information does not represent formal annual regulatory reporting.

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