Yorkshire Water has been downgraded to just two stars by the Environment Agency in a damning review of the nation's water companies.

The EA has carried out the annual performance report and only three companies achieved four stars.

Yorkshire Water has joined Thames Water with a two-star rating, dropping from a three-star.

The announcement has been met with horror by environmental campaigners like Feargal Sharkey and Save Our Swale.

Deborah Meara, a spokesperson for Save Our Swale, described their frustration with the bonuses shareholders of Yorkshire Water receive despite the company rating going down.

She said: "We are disappointed but not surprised to learn that Yorkshire Water’s environmental performance has been downgraded by 3 to 2 stars by the Environment Agency.

"Despite the company admitting to severe sewage pollution failures and disruption in water supply, its CEO, Nicola Shaw received a pay package of £1.03mn, of which £371,000 was a bonus payment.

"This clearly shows Yorkshire Water’s priorities are to its shareholders, and not to its customers."

Alan Lovell, chair of the Environment Agency, said in the foreword to the performance report: "It is with a mix of emotions that I write this foreword to the 2023 performance report containing the Environmental Performance Assessment (EPA). My overriding sense is one of frustration and disappointment. The results we see are, yet again, simply not good enough.  

"The good news is that three companies achieved the maximum four EPA stars compared to one in 2022 – Severn Trent Water, Wessex Water and United Utilities. Credit to Severn Trent for achieving this for the fifth year running.

"But the performance of most companies lags far behind. We are seeing polarised performance as shown by the number of serious pollution incidents. Over 90% were caused by four water companies – Anglian Water, Southern Water, Thames Water and Yorkshire Water. This is unacceptable."

Mike Dugher, Area Director, for the Environment Agency in Yorkshire, highlighted how the drop was due to a struggle to handle pollution incidents.

He said:  "It is disappointing that Yorkshire Water has dropped from a 3-star to a 2-star company. We know this is due to its performance around pollution incidents and we are clear that this simply must improve.   

"Whilst Yorkshire Water has performed well in some areas such as permit compliance, there is no room for any complacency, and we need to see quicker action from companies to turn things around.   

"Our expectations on Yorkshire Water remain high; we expect to see them take rapid actions to address their current poor performance including a consistent reduction in the number of pollution incidents and a sustained improvement in the timeliness and quality of self-reporting. 

"That is why we will continue our rigorous enforcement activity across Yorkshire ensuring that when companies do commit environmental offences, they are rightly held to account."

A Yorkshire Water spokesperson said: "Being rated as a two-star company in the latest Environmental Performance Assessment is certainly not the outcome we, or our customers, want.

"We have a robust improvement plan in place to reduce pollution incidents in the short and long-term, focusing on using new technology to improve visibility of the underground network so we can take action before issues on the network begin to impact the environment and making improvements in self-reporting to further improve performance.

"Climate change and extremely wet weather in 2023, the sixth wettest on record, had a significant impact on the number of serious pollution incidents we dealt with in the 12-month period. The wet weather has continued into early 2024, posing further challenges for us in reducing pollution incidents to where we want them to be.​

"Despite the fall in our overall rating, we are pleased to lead the industry in terms of wastewater treatment works performance and had one of the lowest numbers of total pollution incidents per 10,000km of sewer, which is testament to the work of our teams throughout the year to deliver improved environmental performance."

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Feargal Sharkey responded to the news with horror, he said: "Water companies environmental performance is getting worse.

"After 2021 was supposedly the worst year on record 2023 beats it into oblivion.

"Two years ago, I sat in a room while the EA chair gleefully told everyone that water companies hated this annual review. Really? How's that working out?"