Yorkshire Water has been given the lowest possible environmental rating after a rise in pollution incidents.
The company has been given a one-star (poor) rating by the Environment Agency (EA), meaning it will automatically be blocked from giving out bonuses to bosses under new rules introduced last year.
It comes as new figures published by the EA showed Yorkshire Water was responsible for 260 pollution incidents in 2025, up from 151 the year before. This is a rise of more than 70 per cent and the highest total since 2011.
A Yorkshire Water spokesperson said its environmental performance last year was “not good enough and we understand that customers will be disappointed by this result”.
“In particular, we need to reduce pollution incidents and improve the reliability of our environmental performance.
“We are not waiting for these assessments to tell us that. We have already changed the way we are tackling pollution, with greater operational focus on preventing incidents, improving the health of our assets, and identifying problems earlier.”
The spokesperson said Yorkshire Water is delivering the county’s “largest environmental investment programme” and is “moving at pace, with infrastructure improvements already completed at almost 300 locations in the past six months”.
“There is much more to do, and we will be open about where we are making progress and where we are not," they said. "The test for us isn't simply how much we spend. It is whether customers and the environment see better results."
The spokesperson also said Nicola Shaw, Yorkshire Water’s chief executive, decided earlier this year it “would not be appropriate to receive a bonus due to our performance in the previous financial year, which was not good enough – particularly in relation to our environmental impact”.
It follows Ms Shaw facing backlash from regional leaders after it was revealed she had received an extra £1.3 million from Yorkshire Water’s offshore parent company, Kelda Holdings, since 2023.
Ofwat has already blocked bonus payments from Yorkshire Water, as well as five other water companies over failings.
The water regulator, after Ms Shaw’s extra pay from Kelda Holdings was revealed by the Guardian, announced plans to force water firms to report pay received from parent companies.
Environment secretary Dame Angela Eagle has summoned water bosses to Whitehall to explain their failures and outline immediate action.
It comes after the first joint report by regulators found the water sector’s environmental performance fell to a record low last year despite reforms and investment.
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Dame Angela will set out improvement actions for each water firm, including tackling leakage from pipes, delivering sustained reductions in pollution incidents, and improving customer satisfaction scores.
And recognising executives are still being rewarded in ways that skirt the rules, Dame Angela will look to strengthen the bonus ban rules, with further details expected to be set out in the coming weeks.
She said: “Water companies have let the public down time and time again, and today’s report is further proof that root-and-branch reform cannot wait.”
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