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INVESTING FOR THE
FUTURE
Severn Trent Plc
Annual Report and Accounts 2025
Our reporting
Strategic Report
How we bring our ‘performance driven,
sustainability led’ strategy to life
1 Group Highlights
2 Severn Trent at a Glance
4 Market Review – Water Sector
5 Our 2025-30 Business Plan
6 Our Business Model
8 Chair’s Statement
10 Chief Executive’s Review
12 Our Performance and Key Performance
Indicators
14 Delivering Outcomes our Customers
CareAbout
19 Caring for People in our Region
22 A Driver of Positive Change
28 Running a Business that Goes Hand-in-
Hand with Nature
29 Our Approach to Climate Change and
Nature (TCFD and TNFD)
44 Our Net Zero Transition Plan
55 Our EU Taxonomy Disclosure
60 Business Services Performance Review
61 Chief Financial Officer’s Review
68 Managing Risks and Opportunities
70 Our Emerging Risks
73 Our Principal Risks
79 Viability Statement
84 Stakeholder Engagement
91 Section 172 Statement
94 Non-Financial and Sustainability
Information Statement
Governance Report
How we govern our business responsibly
95 Chair’s Introduction to Governance
98 Our Culture
100 Board of Directors
102 Board Skills
103 Compliance with the UK Corporate
Governance Code 2018
104 Governance Framework
105 Division of Responsibilities
106 Board Activities
108 Board Leadership and Company Purpose
110 Composition and Succession
112 Evaluation
114 Nominations Committee Report
119 Audit and Risk Committee Report
127 Treasury Committee Report
129 Corporate Sustainability Committee Report
131 Directors’ Remuneration Report
135 Remuneration for the Year inReview
136 Performance in the Round for 2024/25
137 Summary of Remuneration Policy and
Implementation for 2025/26
139 Aligning our Performance-related Pay
Structures with our Stakeholders and
Strategic Ambitions
141 Wider Workforce Considerations and our
Approach to Fairness
142 Company Remuneration at Severn Trent
145 Committee Governance
147 Annual Report on Remuneration
155 Directors’ Report
158 Directors’ Responsibility Statement
Financial Statements
Our financial performance for the year ended
31 March 2025
159 Independent Auditor’s Report
165 Consolidated Income Statement
165 Consolidated Statement
of Comprehensive Income
166 Consolidated Statement of Changes in Equity
167 Company Statement of Changes in Equity
168 Consolidated and Company Balance Sheet
169 Consolidated Cash Flow Statement
170 Notes to the Financial Statements
Other Information
221 Five Year Summary
222 Glossary
223 Information for Shareholders
Who we are
Severn Trent Water and Hafren Dyfrdwy
aretwo of the 11 regulated water and
wastewater businesses in England and
Wales. Our non-regulated businesses
operate across England, Wales and Scotland.
What we do
We provide over nine million people across
our region with fresh, clean drinking water
every day – that is about two billion litres.
And when they have finished with it, we take
itaway again and clean and treat it before
returning it safely to the environment.
Households and
businesses served
4.7 million
Litres of drinking water
supplied each day
2 billion
Litres of wastewater
treated each day
3.35 billion
Total Group employees
(Average during 2024/25)
9,539
See note 8 to the financial statements.
Find out more about our climate and nature-related plans and key
strategic documents that utilise scenario modelling on page 41.
PR24 Business
Plan
Strategic Direction
Statement
Green Recovery
Report
Community Fund
Annual Report
Gender and Ethnicity
Pay Gap Report
Customer Vulnerability
Strategy
Contents
| Severn Trent Plc Annual Report and Accounts 2025
Stratford-upon-Avon
Cheltenham
Newtown
Redditch
Nuneaton
Evesham
Loughborough
Oswestry
Market Drayton
Stafford
Welshpool
Ludlow
Tamworth
Leek
Ashbourne
Rugby
Burton
upon-Trent
Kidderminster
Bridgnorth
Buxton
Scunthorpe
Shipston-on-Stour
Stroud
Great Malvern
Ledbury
Cannock
Lichfield
Hathersage
Llanidloes
Monmouth
Llanfyllin
Bishops Castle
Knighton
Worksop
Newark-
on-Trent
Melton
Mowbray
Market
Harborough
Stoke-on-Trent
Derby
Matlock
Mansfield
Nottingham
Leicester
Shrewsbury
Telford
Wolverhampton
Birmingham
Coventry
Warwick
Worcester
Gloucester
RIVER SEVERN
RIVER DEE
RIVER TRENT
Wrexham
Llangollen
Chester
1 Regulated gearing is defined in note 34 to the financial statements.
2 Earnings and the weighted average number of ordinary shares for the purpose of adjusted earnings per share are defined in note 14 to the financial statements.
Our regulated water and wastewater
businesses provide essential services
to4.7million households and businesses
ina region stretching across the heart
ofthe UK, fromthe Bristol Channel to the
Humber and from North and Mid-Wales
tothe East-Midlands.
50.2%
Basic earnings/(loss) per share (‘EPS’) (p)
2
2.3%
Regulated gearing (%)
1
3.8%
Group turnover (£m)
41.2%
Adjusted basic EPS (p)
2
4.2%
Dividend per share (p)
15.3%
Group profit before interest and tax (‘PBIT’) (£m)
2023/24 £2,338.2m
2022/23 £2,165.1m
£2,426.7m2024/25
2023/24 61.3%
2022/23 60.5%
62.7%2024/25
2023/24 51.0p
2022/23 52.7p
76.6p2024/25
2023/24 79.4p
2022/23 58.2p
112.1p2024/25
2023/24 £511.8m
2022/23 £508.8m
£590.2m2024/25
2023/24 116.84p
2022/23 106.82p
121.71p2024/25
Hafren Dyfrdwy
Severn Trent Water
(waterandwastewater customers)
Urban areas, proportional by size
Severn Trent Water
(wastewater customers only)
Group Highlights
Strategic Report | Group Highlights
01Severn Trent Plc Annual Report and Accounts 2025 |
Our regulated water and wastewater businesses are Severn Trent Water and
Hafren Dyfrdwy. The primary activities we focus on are:
Having Courage
We always do the right thing
andhave courage to challenge
the norm and speak up if
thingsaren’t quite right. We
areprepared to step out of our
comfort zones and act with both
today and the future in mind.
Showing Care
We keep our promises to
customers and show care by
treating everyone fairly and
equally. We try to enhance the
environment around us and
spend every pound wisely.
Our strategy to be ‘performance driven,
sustainability led’ acknowledges our relentless
drive to deliver the performance that our
stakeholders expect, inasustainable way.
We serve a diverse range of customers with different
cultures, interests and experiences. Our region
includessome of the most affluent areas of the country
as well assome of the most deprived. There are several
large urban areas in our region, yetwe also serve
predominantly rural counties and communities. It is
aregion which is characterised by,andbenefits from,
itsdiversity.
How we are structured
Our
values
Severn Trent
Severn Trent
severntrent
stwater
stwaterweb
severntrent
Social channels
Performance driven,
sustainability led
Our purpose
Driven by our strategy
Taking care of one
of life’s essentials
Scan the QR code to
visit our sustainability
webpages
We provide over nine million people
across our region with fresh, clean
drinking water every day.
Providing clean water
Over 3.35 billion litres of wastewater
are treated every day, cleaned and
returned to the environment.
Treating wastewater
Severn Trent generates its own
energy through a variety of sources
including the anaerobic digestion of
sewage sludge, food waste, crops,
solar, wind and hydro.
Generating renewable energy
Severn Trent at a Glance
02 | Severn Trent Plc Annual Report and Accounts 2025
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sustainability
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Business Services operates a UK-based portfolio that complements the Group’s core
competencies and is well positioned to capitalise on market opportunities in these areas:
Taking Pride
We make a difference for our
customers every day, owning
problems and working with others
until they are solved. We take pride in
what we do and champion our work
inthe communities we work and live in.
Embracing Curiosity
We search out safe, better
andfaster ways of doing things
through innovation and are always
curious and willing tolearn.
Non-regulated business
PEOPLE
CHANGE
Helping our own people thrive
Supporting our suppliers
Creating opportunities in
ourcommunities
A force for good for our
customers
A role model for others
Collaborating widely to
supportinnovation
Creating a market that works
foreveryone
Actively improving the places
we touch
Creating opportunities to
enjoy nature
Valuing our most precious
natural resources
Managing our impact on nature
and climate change
Investing for the long term
Resilient to a changing future
Putting the customer first
Right first time every time
Our corporate strategy
OUTCOMES
NATURE
Operating Services provides a variety
ofoperational water and wastewater
services to private businesses across
the UK.
Operating Services
Our Property Development business
manages the sale of surplus land.
Property Development
Severn Trent Green Power generates
renewable energy from anaerobic
digestion, hydropower, wind turbines
andsolar technology.
Green Power
Strategic Report | Severn Trent at a Glance
03Severn Trent Plc Annual Report and Accounts 2025 |
There are 17 regional businesses supplying water services in England and Wales, serving over 60 million household
and non-household customers. Of these, 11 also provide wastewater services, including Severn Trent Water and
Hafren Dyfrdwy. Our long-term strategic planning embraces the challenges and unpredictability of the future.
Byanalysing change drivers and their impacts, we can understand potential outcomes and respond effectively to
manage risks and seize opportunities. Looking ahead, we recognise a number of challenges that are particularly
relevant for our Group:
Working with our regulators and stakeholders
We are subject to regulation of our price and performance by
economic, quality and environmental regulators, as outlined
below. You can read more about how we engaged with our
regulators and other stakeholders this year on pages 84 to 90.
We also work with a range of other regulators, including:
– Health and Safety Executive to ensure that thehealth and
safety of our employees, customers, visitors and supply chain
ispreserved;
– Ofgem, the economic regulator of gas and electricity markets,
whose remit extends torenewable energy generation; and
– Ofsted, the regulator for education, children’s services and
skills, since our Academy became accredited.
In response to climate change, we are innovating and improving to
mitigate the impacts of water availability, water quality, abstraction,
and more extreme weather events like flooding and drought. By
managing our water resources more sustainably, we can enhance
the performance, resilience, and flexibility of our network,
especially during times of stress. We are committed to lowering
greenhouse gas emissions and achieving net zero operational
emissions by 2030, and net zero across all scopes by 2050.
Linked Principal Risks: 2, 3, 9, 10 and 11
See pages 74 to 78
Climate change
We recognise the criticality of the natural environment
andarededicated to protecting it for future generations.
Thatiswhy we are committing to our biggest ever investment in
sustainable practices and reversing deterioration of the natural
environment. We are working across our supply chain and with
key stakeholders to adopt more environmentally-friendly
practices to reduce our impact on the environment – especially
our rivers and waterways and to minimise waste and embrace
circular economy principles.
Linked Principal Risks: 2, 3, 9 and 10
See pages 74 to 78
Environmental changes
A growing and more aged population, more people living
alone and urbanisation are increasing pressure on both housing
and water. To ensure our water resilience, we are investing in
new water supplies, adding more storage and treatment capacity,
reducing leakage and promoting water consciousness among
our customers.
Linked Principal Risks: 4 and 6
See pages 75 to 76
Demographic and social structure
We recognise and understand that our customers are feeling
the effect of economic uncertainty and cost of living pressures.
Our sector-leading affordability support will help c.700,000
customers who need help paying their bill each year by 2030, the
equivalent of one in six customers. We are also working with our
communities to make a positive social difference through our
Societal Strategy.
Linked Principal Risks: 4, 7 and 8
See page 75 to 77
Affordability challenges
Our commitment to innovation means we are constantly on the
lookout for cutting-edge technologies that can positively impact
our customers. Technological advances continue to present
exciting new opportunities to deploy smart devices, automation,
machine learning and artificial intelligence to improve the
delivery of our services for customers and how we monitor and
operate our assets efficiently and safely. We are excited to invest
in new technologies and will continue to explore their application
within our business.
Linked Principal Risks: 4 and 11
See pages 75 to 78
Maturing technologies
Policy
The Department for Environment, Food & Rural
Affairs (‘Defra’) in England, and the Welsh Government,
provide strategic and policy direction for the industry
and our regulators.
Regulation and representation
The Consumer Council for Water (‘CCW’)
speaks on behalf of water consumers in
England and Wales.
The Drinking Water Inspectorate (‘DWI’)
independently checks that water supplies in
England and Wales are safe and that drinking
water quality is acceptable to consumers.
The Environment Agency (‘EA’) regulates and
allows us tocollect water from reservoirs,
rivers, and aquifers and return it to the
environment after ithas been used by our
customers and treated byus.
Natural England advises the Government
onthenatural environment in England and
helps to protect nature and the landscape,
especially for plant and animal life in both
freshwater and the sea.
Natural Resources Wales (‘NRW’) is the
environmental regulator in Wales. It oversees
how the country’s natural resources are
maintained, improved and used, both now
and in thefuture.
Ofwat is the economic regulator for the water
and wastewater industry in England and
Wales. Ofwat principally exercises its duty
toprotect the interests of customers through
periodic reviews of charges (price reviews)
every fiveyears.
Market Review – Water Sector
04 | Severn Trent Plc Annual Report and Accounts 2025
£6.4bn
enhancement
spend
Raw water
£0.3bn
Other £0.2bn
Bioresources
£0.5bn
Net zero
£0.3bn
Resilience
£0.3bn
Storm
overflows
£1.5bn
Water
resources
£1.1bn
Water
environment
£0.4bn
Population
growth
£0.7bn
River health
£1.1bn
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2020/21 2021/22 2022/23 2023/24 2024/25 2025/26
AMP8 average capex
£m
AMP7 AMP8
A key year in our regulatory cycle
Every five years, water companies in England and Wales develop
business plans setting out how they intend to deliver for customers
and the environment over the next Asset Management Period (‘AMP’).
Our full plans and Ofwat’s Final Determinations are available on our
websites. Scan the QR codes below to download our Business Plans.
An outstanding Business Plan
We are delighted that our Severn Trent Water Business Plan for
2025-30 was awarded ‘outstanding’ status by Ofwat – inrecognition
ofboth its quality and the scale of our ambition.
Our AMP8 Final Determination totex allowance of £14.9 billion is
around twice as much as was approved for AMP7, £6.4 billion of which
is dedicated to service and environmental enhancements. We expect
to generate nominal Regulatory Capital Value (‘RCV’) growth of 60%
across the AMP, which would take our AMP8 closing RCV to around
£17.2 billion (in 2022/23 prices).
Our biggest ever enhancement investment
Building on our strong operational and environmental track
record, in AMP8 our largest ever enhancement programme will
allow us to make significant progress in areas our customers
care about most, including:
– delivering the industry’s fastest and most ambitious spills
reduction programme, as we aim to halve spills by 2030 and
strive towards global best practice (read more on page 23);
– accelerating the improvement of river health, so we account
for just 2% of Reasons for Not Achieving Good Status
(‘RNAGS’) in our region by 2030 (read more on page 23);
– delivering a further 14.8% reduction in leakage and replacing
around 1,400 km of water mains;
– strengthening water resilience to ensure we can meet
customer demand during hot weather;
– scale investment into water treatment and biosolids to
address per and polyfluoroalkyl substances (‘PFAS’) (read
more on pages 71 to 72);
– supporting growth in our region through investment in
70waste treatment works; and
– achieving operational net zero by 2030 (read more on
pages 45 to 53).
Organisational readiness
Our Business Plan is intentionally ambitious, and our investment
andwork in AMP7 has positioned us strongly to deliver in AMP8:
– our in-house Design Team unlocks digital and automation
capabilities;
– our Plug and Play delivery model drives speed and efficiency on
critical asset types;
– a broad and diverse supply chain provides resilience and flexibility;
– shareholder support for our £1 billion equity raise has enabled us
toaccelerate AMP8 investment;
– stepping up our capital expenditure to £1.67 billion in the final year
of AMP7 means we are already at our AMP8 run-rate; and
– having accepted Ofwat’s Final Determination in January 2025, our
delivery of AMP8 is already underway.
Affordability and support
We remain committed to keeping bills affordable, while delivering
record investment. We will begin and end AMP8 with the second
lowest bill in England and our £575 million affordability package will
support one in six customers with their bill by 2030. Additionally, we
will support 100,000 people through our 10-year Societal Strategy
and our Community Fund will continue into the next AMP.
Our Business Plan has high levels of customer support, with an 81%
acceptability rating according to CCW research on Ofwat’s Draft
Determinations, the highest in the sector.
Severn Trent Water
2025-2030
Business Plan
Hafren Dyfrdwy
2025-2030
Business Plan
Capital expenditure
Christine Hodgson observes a Business Plan customer
engagementsession
Our 2025-30 Business Plan
Strategic Report | Our 2025-30 Business Plan
05Severn Trent Plc Annual Report and Accounts 2025 |
Key:
Strategic objectives
Outcomes
Nature
People
Change
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Our purpose
At Severn Trent, we are
driven by our purpose –
taking care of one of life’s
essentials. When we are
united by our clear social
purpose, we can drive
positive change and deliver
positive outcomes for all
our stakeholders – our
customers, colleagues,
investors, regulators and
Government, the society we
live in and the environment
we depend on.
Now, more than ever,
weknow that taking care
of one of life’s essentials
means that what we do
really matters to the
families, businesses and
communities we serve.
This is why our values of
Having Courage, Showing
Care, Taking Pride and
Embracing Curiosity are
so important to us. Being
acompany that can be
trusted, taking care of the
environment, helping
people to thrive and
providing the best-value
service means we all need
to be focused on living our
values, by Doing the Right
Thing, every single day –
the Severn Trent way.
Our resources and relationships
We maintain over 50,000 km of clean
water pipes, over 93,500 km of sewer
pipes, and c.130 water and c.1,000
wastewater treatment works.
Principal Risks: 2, 3, 6, 9 and 10
Strategic objectives:
Physical assets
Outcomes PeopleNature
Change
Our RCV is in excess of £13.7 billion.
Our net debt represents 62.7% of
ourRCV.
Principal Risks: 7 and 8
Strategic objectives:
Outcomes PeopleNature
Change
We look to attract, develop and retain
talented people from all backgrounds.
We directly employ over 9,800 people.
Principal Risks: 1, 2, 3, 4, 6, 7 and 11
Strategic objectives:
Outcomes PeopleNature
Change
Our people and culture
We rely on technology every day to
communicate, store and manage data,
operate our assets and monitor our
operations. We are always exploring
innovative technology to drive
continuous improvement.
Principal Risks: 2, 3, 4, 6, 9 and 11
Strategic objectives:
All contracted suppliers are required
to sign up and operate in line with our
Supply Chain Sustainability Charter.
Principal Risks: 1, 2, 3, 5, 6, 9 and 10
Strategic objectives:
Suppliers and partnerships
We take care of some of the UK’s most
impressive natural resources and
make them accessible to support the
health and wellbeing of communities.
Principal Risks: 1, 2, 9 and 10
Strategic objectives:
Outcomes PeopleNature
Change
Natural resources
Outcomes PeopleNature
Change
Outcomes PeopleNature
Change
Financial capital Technology and innovation
Our Business Model
06 | Severn Trent Plc Annual Report and Accounts 2025
Taking
care of one
of life’s
essentials
Collect raw water
We collect water from reservoirs,
rivers and underground aquifers
across our region.
Clean raw water
Our groundwater and
surface water treatment
works clean raw water
tothe highest standards,
making it safe to drink.
Distribute clean water
Our network of pipes and our
enclosed storage reservoirs bring
a continuous supply of clean water
direct to our customers’ taps.
Customers enjoy our services
4.7 million households and businesses use our services,
delivered by a team of over 9,800 employees, and
supported by our contact centres, always ready to help.
Collect wastewater
Our network of sewers and pumping stations
collect wastewater from homes and businesses
and take it to our wastewater treatment works.
Clean wastewater
Wastewater is carefully
screened and treated in our
wastewater treatment
works to meet stringent
environmental standards.
Recycle water to
the environment
We safely return treated
water to rivers and
watercourses.
Green energy
The green energy we generate through our
Business Services activities contributes to
meeting our net zero targets and keeping
our energy costs down.
What we do
The value we create for all stakeholders
Regulators, Government and Non-
Governmental Organisations (‘NGOs’)
The policy framework for our sector is set by the
UK and Welsh Governments. Our industry is
regulated by Ofwat, the EA and others. We are
striving to set the standard for environmental
performance by continuing to achieve 4* status in
the annual Environmental Performance
Assessment (‘EPA’). Our non-regulated businesses
drive competition in the market, improving the
quality and value in the water sector supply chain.
We provide clean water and wastewater services and develop renewable
energy solutions through our businesses. In the course of providing these
services, we create social and environmental value.
Our customers
We aim to anticipate and meet changing customer
and wider societal needs, as well as improve and
protect the natural environment.
How we measure this
Outcome Delivery Incentive (‘ODI’) performance
(%of targets/measures met or exceeded)
Our colleagues
Our greatest asset is our experienced, diverse and
dedicated workforce. Our relationship with them is
open and honest, and they are appropriately
supported, developed and rewarded to encourage
them to be their best in all that they do.
How we measure this
Employee engagement score (out of 10)
Our communities
We create value for the communities we operate in
by providing direct employment to local people,
engaging withlocal businesses in our supply chain,
and paying businessrates to local government.
How we measure this
Severn Trent Community Fund (£m donated to
charitable projects inourregion)
Our shareholders and investors
We create value for equity investors through a
reliable, index-linked dividend, underpinned by
strong operational performance, and a growing
RCV, which will lead to higher returns in the future.
How we measure this
Return on Regulated Equity (‘RoRE’) (%)
Our suppliers and contractors
Strong supplier relationships ensure sustainable,
high-quality delivery for the benefit of all
stakeholders, supporting our business operations
in line with our Code of Conduct and modern
slavery commitments.
How we measure this
Average time to pay suppliers (days)
2023/24 76%
83%2024/25
2023/24 8.6
8.62024/25
2023/24 7.8%
9.3%2024/25
2023/24 £2m
£2m2024/25
2023/24 33
342024/25
Strategic Report | Our Business Model
07Severn Trent Plc Annual Report and Accounts 2025 |
Our sector is currently undergoing a period of
unprecedented scrutiny and regulatory reform.
Thisisapivotal time for the sector and provides an
opportunity to deliver much needed investment for
customers, which will help us regain public trust
byfocusing on the things they care about most.
We are excited about the scale of our Final Determination and
arefocused on effective and efficient deliverability of our AMP8
investments to ensure customers’ money is spent wisely, whilst
alsomindful of the impact that higher bills have on our customers.
Therefore, we are committed to a meaningful affordability strategy
that ensures no customer should fear their water bill.
We have set bold ambitions for AMP8, that will create value for our
customers and shareholders, whilst protecting the environment and
delivering our social purpose commitments – that will help restore
trust in the sector and instil confidence in Severn Trent as an
investment proposition.
Serving our stakeholders, now and for the long term
As the sector evolves in response to public policy and regulatory
reforms, we must be mindful that investors have choices over where
to invest and, similarly, individuals have choices where to forge their
careers. It is therefore crucial that we continue to perform strongly
and clearly articulate the value of our business through delivery of
our strategy, as we embark on AMP8 and beyond.
Throughout the past year, the Board has focused itself on ensuring
Severn Trent’s success across all areas, making strategic decisions
that serve the long-term interests of all our stakeholders. A high-
level summary is provided below and you can read further detail
onour performance this year in Liv’s Chief Executive’s Review.
Closing out a successful AMP7
Severn Trent has demonstrated industry-leading operational
andenvironmental performance and strong financial resilience
consistently over the last five years, delivering £332 million of ODI
outperformance over AMP7, considerably more than any other water
company has delivered in total throughout the AMP. Our strong
operational performance and financial resilience has enabled
ustowithstand geopolitical and economic headwinds, many of
whichcould not have been foreseen, such as COVID-19 and global
conflicts, and has positioned us strongly to participate in emerging
opportunities such as Green Recovery. It has also enabled us to raise
£1 billion in equity to accelerate improvements for our customers
andthe environment, support delivery of year-on-year operational
outperformance and drive growth.
Our AMP8 journey is underway
In December, Ofwat approved our Final Determination – which
willsee our largest ever investment over the next five years. Our
‘outstanding’ and ambitious £14.9 billion Business Plan will support
us to deliver significant progress in areas our customers care about
most, including delivering the industry’s fastest and most ambitious
spills reduction programme, reducing pollutions by a further 30%,
achieving a further 14.8% reduction in leakage and reaching
operational net zero by 2030.
Our significant capital delivery in AMP7 positions us strongly to
deliver this step change in investment and the acceleration of our
capital programme in AMP8 will improve our performance as early
aspossible in the AMP to deliver early benefits for customers.
Youcan read more about the benefits that our Final Determination
willdeliver for our customers on page 5.
AMP8 is a significant undertaking and one that I, and the entire Board
and Executive Committee, take very seriously. The Board has focused
on overseeing the Group’s preparedness for the next AMP, including:
– Ambition – instilling a high-performance culture and ensuring that we
always challenge our own ambitions to drive better outcomes for our
customers, communities and the environment both now and over the
long term. A good example of this is our Combined Sewer Overflow
(‘CSO’) Improvement Plan, which you can read more about on page 23.
– Deliverability – ensuring we have the people and supply chain
inplace to deliver our investment. The Board scrutinised the
Company’s approach to deliverability throughout development of
our Business Plan – and held a dedicated deep dive during the year
– to ensure that an effective organisational structure is in place,
supported by strong talent and expertise within the Company and
its supply chain.
– Affordability – accelerating our AMP8 plans will deliver significant
service delivery improvements for our customers and the environment
and will grow our business – all whilst maintaining thesecond lowest
bill in England and supporting around one insixcustomers with their
bills through our £575 million affordability package.
– Transparency – providing all of our stakeholders with confidence
that our strategy and processes for data assurance and governance
support high-quality, transparent data and reporting across all
aspects of our business – so they can assess our performance and
hold us to account.
– Resilience – ensuring that we demonstrate operational, financial
and corporate resilience throughout AMP8 and beyond – for
example, making sure we are resilient to increasingly extreme
weather events. The Board has challenged management on the
strength of our operational resilience and approach to winter and
storm event readiness.
– Financeability – securing the appropriate funding to safeguard our
financial resilience. The Board and Treasury Committee applied
focus to this during the year and you can read more in Helen’s
ChiefFinancial Officer’s Review from page 61.
Areas of Board focus for 2024/25
This year’s report brings to life the significant work and activity
undertaken by your Board and Executive Committee during the year.
Iwould like to highlight a few particular areas that the Board has
applied focus to this year, as follows:
Supporting our customers and communities – as well as providing
financial support to customers who might need it, we are dedicated
toensuring that our vulnerable customers receive the additional
support they need. During the year, we oversaw the Company’s
approach to allocating bespoke services to our vulnerable customers
– including tailored communications, personalised services and
prioritisation during incidents – to ensure they always have access
toour services in a way that works for them.
Dividend per share
121.71p
2023/24: 116.84p
Group PBIT
£590.2m
2023/24: £511.8m
Group turnover
£2,426.7m
2023/24: 2,338.2m
Christine Hodgson
Chair
Chair’s Statement
08 | Severn Trent Plc Annual Report and Accounts 2025
As a Board, we understand the essential role that Severn Trent
plays in our communities and are committed to driving positive
change and making a positive impact across our region. Our 10-year
Societal Strategy embodies this desire and we have proudly
supported more than 26,000 people, generating nearly £7 million
ofSocial Value since 2022.
Enhancing our environment – we are confident of achieving the
highest possible rating in the Environment Agency’s (‘EA’) demanding
Environmental Performance Assessment (‘EPA’) for the sixth
consecutive year. Notwithstanding this good progress, we know that
our pollutions performance needs to improve further. We take the
views of our customers and wider stakeholders seriously and are
committed to improving our pollutions performance. The Board
scrutinises performance at every meeting and meets with a broad
range of stakeholders, including our regulators, to inform our
oversight and ensure we are delivering what they expect of us.
Climate resilience – extreme weather events are becoming
increasingly frequent and severe. Last year, in response to Storm
Babet, we oversaw the Company’s approach for future storm events,
focusing on proactive measures to be implemented, prioritisation of
resources, communications with customers and communities and
reactive actions to be deployed to mitigate the potential impacts to
thegreatest extent possible.
Net zero by 2030 – we remain committed to being operationally net
zero by 2030. This Annual Report includes our revised Net Zero
Transition Plan (‘NZTP’), which reflects the outcome of our Final
Determination and our commitment to mitigating and adapting to
climate change. As outlined in my report last year, the NZTP is being
tabled for an advisory shareholder vote at our Annual General
Meeting (‘AGM’) on 10 July 2025. You can read our full NZTP on
pages44 to54.
Regulatory landscape
We welcome reforms of the sector and our hope is that it will sustain
the higher levels of private sector investment needed to improve
services and restore trust. Similarly, companies need clarity so that
they can be held to account by their stakeholders – again helping to
rebuild trust.
The Water (Special Measures) Act (the ‘Act’) received Royal Assent on
24 February 2025 and the Board has considered the requirements of
the Act during the year.
However, there is still much regulatory reform to complete to be able
to provide the clarity and certainty our stakeholders need. The sector
reform agenda for the period ahead is significant, with regulatory
consultations, independent reviews and subsequent legislation change
that will impact the structure and regulation of ourindustry:
– At the date of this report, Ofwat’s consultation related to rules on
remuneration has recently concluded and the outputs are awaited.
Our focus as a Board and Remuneration Committee is to ensure we
can attract and retain the exceptional talent we need to deliver for
our customers and other stakeholders, both now and in the future.
– Similarly, the Independent Commission into the water sector and
itsregulation – led by Sir Jon Cunliffe – remains underway and
highlights the importance of strengthening relationships between
regulators and water companies whilst improving the regulatory
regime to rebuild trust in the sector, protect customers and deliver
long-term stability through supporting investment andgrowth. We
look forward to considering the outputs of this review in due course.
A great deal of progress has been made during the year on developing
the framework under which we will be required to operate when
regulatory changes are fully implemented. Clarity for the sector is
essential if we are to be able to position our business to meet the
expectations of our customers, our regulators and those that
investinus.
Rebuilding trust
Restoration of trust in our sector remains a significant challenge
butit is a challenge we are passionate about meeting successfully.
The sector as a whole must respond to this by improving performance
to meet the expectations of our customers and wider stakeholders,
both now and in the long term, to rebuild trust. I am proud of the role
Severn Trent is playing in forging a path to meet these expectations –
through setting bold ambitions, accelerating investment, with the
support of our shareholders, and embodying the social purpose we so
passionately believe in. At the same time, we acknowledge that there
is more to do in the areas that matter most toour customers and
wider stakeholders.
Listening to our stakeholders
As a Board, we strive to instil a high-performance culture, ensuring
that all of our employees feel a strong connection to our purpose,
embody our values and feel safe and secure. Our Code of Conduct
Doing the Right Thing, protects all employees and supports them to
sustain customer, colleague and wider stakeholder trust. All Board
members regularly spend time out and about in our business,
meeting with our employees to hear their views and feedback first
hand. Their feedback and observations reinforce that our workforce
continues to be highly engaged, as demonstrated by our excellent
engagement score of 8.6 out of 10 for the second year running,
placing us in the top 2% of utilities globally. You can read more about
Board engagement on pages 86 and 98 to99.
During the year, the Board also spent a significant amount of time
with regulators and investors through a range of site visits, at Board
meetings, our Governance Roadshow and at our Capital Markets Day.
The Board’s activities are presented in detail on pages 106 and 107
and stakeholder engagement is outlined on pages 84 to 93. We look
forward to meeting shareholders, many of whom we have had the
pleasure of meeting several times over the years, at our AGM.
In consideration of the Company’s performance delivery for our
customers, communities and the environment, the Board has
proposed a final dividend of 73.03 pence for the year ended 31 March
2025. Full details of the Board’s Performance in the Round
assessment, considered in recommending the proposed dividend,
arepresented on page 97.
Leadership now and for the future
I am confident that the Board is well prepared for the challenges
andopportunities that AMP8 will bring. We have a diverse and
experienced Board and I would like to convey my thanks to them for
their contribution, insight and constructive challenge during the year.
We announced some changes to our Board earlier this year, as Kevin
Beeston stepped down on 30 April 2025 after nine years’ service. On
behalf of the Board, I would like to express our thanks to Kevin for his
expertise, professionalism and unwavering commitment throughout
his tenure as the Board’s Senior Independent Director. We are immensely
grateful for his service and wish Kevin all the best for the future.
We welcomed Nick Hampton to the Board on 4 April 2025 and he
succeeded Kevin as Senior Independent Director on 1 May 2025.
Nickbrings extensive experience in general management, finance,
investor relations, strategy, M&A, information systems and
procurement. You can read his full biography on page 100.
With AMP8 fully underway, we are well positioned to deliver positive
outcomes for our stakeholders over the next five years. I am confident
that our Executive Committee will deliver the commitments we have
made and continue to demonstrate exemplary leadership both within
our organisation and across the broader sector, deliver our biggest
investment to date and maintain our strong track record of
operational and environmental performance – all of which will be
essential to help the sector as a whole rebuild trust.
I look forward to the year ahead, and delivering positive outcomes
forour customers, communities and the environment.
Christine Hodgson
Chair
Strategic Report | Chair’s Statement
09Severn Trent Plc Annual Report and Accounts 2025 |
My report this year marks the beginning of my third
AMP at Severn Trent and I still come into work
energised each and every day, knowing what we do
matters and we are making adifference – and I’m
buoyed up by the prospect ofa new, exciting AMP.
As outlined in my report last year, our AMP8 Business Plan is the
most ambitious in our history, and I’m thrilled that it was rated
‘outstanding’ by Ofwat. It is my firm belief that our customers will
benefit massively from our investment for many generations to come.
Our £14.9 billion investment is around twice that approved for AMP7 and
will see us enter a new era of growth – delivering nominal RCV growth of
64% across the AMP. And by accelerating our investments, we’ll deliver
significant progress – at speed – in areas our customers care about most,
meaning they’ll see the benefits as early as possible in the AMP, including:
– delivering the industry’s fastest and most ambitious spills
reduction programme – aiming to halve spills by 2030 and strive
towards global best practice;
– improving the health of rivers in our region so our communities can
enjoy them for generations to come – reducing our contribution of
Reasons for Not Achieving Good Status (‘RNAGS’) in our region’s
rivers from 10.8% this year, to just 2% by 2030;
– achieving European-leading leakage performance, by replacing
around 1,400 km of water mains and delivering a further 14.8%
reduction in leakage – better than our counterparts in France
andSpain;
– supporting growth in our region through job creation, unlocking
housing development and addressing the drivers of poverty in
ourregion – improving the life chances of 100,000 people in our
patch through work experience, training and employability skills
development – and supporting future housing development through
investing in 70 waste treatment works; and
– achieving operational net zero by 2030.
Our Business Plan, and regulatory outcome, is a wonderful testament
to the dedication of everyone involved in its development, particularly
our 68,000 customers who played a huge role in shaping our
proposals. I would like to thank each and every one of our customers
who shared their views and feedback with us through this process.
In this year’s Chief Executive’s Review, I want to share my personal
highlights of our performance in AMP7 – and this year. I’ll touch on
how our sustained outperformance will drive efficient growth and
deliver benefits for our customers, the environment and wider society,
our lovely people and investors supporting us on our long-term
journey. I’ll also talk openly about the ongoing areas for improvement.
I am incredibly proud of the progress that we’ve made over the last five
years. We’ve had great performance on ODIs for each and every year of
the AMP, we’ve uniquely achieved the highest accolade of 4* status
from the EA for five consecutive years, landed an outstanding Business
Plan – that we believe to be very fair – and made the conscious decision
to invest in our company to ensure we are the best we can be – through
a blend of insourcing, developing deeper technical skills and embracing
technology including AI to drive operational excellence.
All this was against a tricky backdrop – we’ve faced a global pandemic,
unprecedented energy and chemical prices, a cost of living crisis, and
the sector has faced more public scrutiny than we could have imagined.
But we stand here today stronger than ever and I believe that the
unique Severn Trent mindset, our strength, values and resilience have
enabled us to address such challenges head on and be confident that
we’ll sustain this outperformance over the next five years.
Our people are totally invested in our business and all that we do,
being customers and more than 70% also being shareholders
throughSharesave. I want to thank every single one of them for their
magnificent and selfless commitment – and for all they do for Severn
Trent, our customers, communities and the environment – 24 hours
aday, seven days aweek. They are the magic ingredient that makes
Severn Trent so special – and it’s a joy to work with them every day.
Investing for the future
Building a lasting legacy for our customers today and for
generations to come is one of our most important responsibilities.
That’s why I’m starting my performance review with an update on
our capital programme.
Our sustained outperformance, underpinned by our strong financial
resilience, has seen us deliver a record period of investment over
AMP7. It’s also meant we could make a fast start on deploying our
AMP8 investment, and deliver service improvements for our
customers and communities as early as possible. We’ve invested
arecord £1.7 billion through our capital programme this year, almost
triple the level of investment from the start of AMP7. This brings our
investment levels in line with our desired run rate for AMP8, thanks
totwo key differentiators:
– Firstly, in 2021 we were awarded an additional £566 million
(2017/18prices) by Ofwat for our Green Recovery programme –
71%of all funding awarded to the sector – across six workstreams
aimed at driving innovation. That work has scaled-up across AMP7,
culminating in final delivery this year, giving us heaps of experience
in a number of emerging areas – such as future expectations in
relation to PFAS, commonly referred to as ‘forever chemicals’.
Youcan read more about this on pages 71 to 72 and in our Green
Recovery Report on our website, from 15 July.
– Secondly, we’ve accelerated £450 million of investment from AMP8
to put us on the right run rate and, more importantly, deliver
customer and environmental benefits early in areas such as storm
overflow spills. Our £450 million investment has delivered over
1,800 interventions, covering 69% of our priority storm overflows –
and we enter the AMP at the lowest starting point in the sector,
despite the impact of exceptionally wet weather during the year.
AMP8 investment
£14.9bn
2024/25 capital
investment
£1.7bn
2023/24: £1.2bn
Net ODI reward
£68m
2023/24: £55m
Liv Garfield
Group Chief Executive
Liv on site at Tittesworth Reservoir, August 2024
Chief Executive’s Review
10 | Severn Trent Plc Annual Report and Accounts 2025
Our significant AMP7 investment has also helped us to extend our
position as an environmental leader and we’re confident that we will
be awarded the highest possible 4* status from the EA in their 2024
EPA, making it six consecutive years – something no other company
has ever achieved. That said, we have a beady eye on the future of the
EPA regime in AMP8 – which will see the introduction of new, and
even more challenging, metrics that we are shadow reporting in
earnest to put us on the best footing to retain our environmental
leadership credentials. You can read more about the EPA on page 18.
Continued strength in water
We’ve invested a significant amount of time and resource into
strengthening the resilience of our water networks over AMP7;
bringing more assets online to enhance our network, improving our
flexibility so we can get water to the right places at the right time, and
creating an in-house Network Response Team – dedicated to finding
and fixing problems and getting our customers back on supply as
quickly as possible.
This investment has proven worthwhile and is reflected in our water
metrics. AMP7 saw us live through some of the hottest and driest
summers since records began. For example, in Summer 2022, we
were producing an extra 450 Ml/d to sustain demand. The resilience
of our network, combined with the incredible support from our
customers in response to our extensive demand management
campaigns, meant we were able to keep the water flowing, navigating
the summer conditions. And we are proud to have not had Temporary
Usage Bans (also known as hosepipe bans) in 30 years. However, it’s
clear that weather extremes are now part of our business as usual.
We are not at all complacent and have applied a great deal of focus
toour readiness plans ahead of entering the summer period.
I’m therefore delighted with the sustained progress on our leakage
journey. We’ve seen a significant year-on-year leakage reduction,
beating our target with a 16.8% leakage reduction across AMP7.
We’realso repairing significant visible leaks 60% faster than at
thestart of AMP7, thanks to improvements in our planning and
scheduling processes which help us to manage our performance
inreal time and novel technologies such as no dig fixes, which can
reduce fix times from three days to just 30 minutes with minimal
customer and community disruption.
Similarly, supply interruptions are at their lowest ever level, achieving
our regulatory target with the average customer on supply for more
than 99.99% of the year.
And on low pressure, we’ve once again outperformed our target,
witha total of 325 low pressure days against our target of 17,062,
reinforcing that our £15 million investment in AMP7 is turning the
dialand improving services even further for customers.
Driving performance in waste
Waste is another area where we’ve made significant investment
overAMP7 and we’re seeing the benefits. We insourced our Waste
Infra Response Team in 2023, giving us greater internal control
overthe quality of work delivered. Our ‘right first time’ approach to
blockages has reduced the number of repeat incidents, and new
innovations and technology such as the Stickleback – a tool which
captures items in sewers before they can cause a blockage – have
prevented many potential issues. We have reduced blockages by 40%
over the AMP7period.
We have worked hard this year to drive improvements in areas our
customers care about most – such as internal sewer flooding. Our
new‘fast response’ approach has helped to prevent external floods
becoming internal, and I’m pleased that we have achieved our best ever
internal sewer flooding performance, outperforming our target this
year. We’ve also achieved our public sewer flooding target, meaning
we’ve hit our target every year this AMP with a 13% reduction across
the five years.
Whilst our serious pollutions performance for the year meets the
EA’shighest EPA 4* standard, we’re disappointed with our overall
pollutions performance. Therefore, we are investing £400 million
over the next two years to deliver a real step change. Our Pollution
Incident Reduction Plan (‘PIRP’) will drive performance
improvements at the pace our customers expect, including improving
400 sewage pumping stations, insourcing the capability to undertake
complex sewer repairs, creating a Repeat Prevention Team to reduce
follow-up incidents and increasing our level of proactive
interventions. You can read more about our plans on page 17 and in
our PIRP on our website.
Affordability and customer service
We never want our customers to fear their bill and although our
average bill remains the second lowest in the country – and will
remain so throughout AMP8 – we understand this will be more than
some customers will be able to afford. And so, we’ve more than
doubled the affordability support we provide – through our new
£575 million support package. This will see over 700,000 households
– around one in six customers – receiving some form of support
by2030.
On customer service, I am disappointed that our C-MeX scores remain
mid-table, but pleased that our Trustpilot score of 4.8 out of 5 is among
the highest in the FTSE100, with 92% of customers rating their experience
as five star. I am also delighted that we have reduced complaints from
household customers by almost 80% during the course of the AMP.
You can read more on our operational performance in the
performance review sections and our financial performance in
Helen’s Chief Financial Officer’s Review.
Looking to the future
We’re incredibly proud to serve the Midlands, and our customers
andcommunities that call the Midlands home. I’m optimistic for
theperiod ahead. Our Business Plan will deliver significant, and
meaningful, benefits for our customers and wider society. Whilst
many of these have a long-term perspective and look 25 years ahead,
the next five years will see us make real progress – driven by our
AMP8 performance commitments – that ensure our customers, and
wider stakeholders, can hold us to account.
I’d like to end my report by thanking my brilliant leadership team
fortheir unrelenting passion, drive and infectious energy in tackling
every challenge. We are grateful too for the stewardship, support –
and challenge – from Christine and the Board. I’d also like to thank
the lovely c.10,000 Severn Trenters. Working alongside them, and
making a real difference in our region, energises me every day.
Theyare the secret to our success.
And finally, one of the unique things about Severn Trent is our rich
history – and our Derwent Reservoir dam holds a special place due
toits connection with the famous ‘Dambusters’ Squadron, who used
the dam for training during World War II. In recognition of VE 80, we
illuminated our dam in remembrance, alongside a whole host of other
VE day events across our sites.
Liv Garfield
Group Chief Executive
VE 80 illumination at Derwent Reservoir dam
Strategic Report | Chief Executive’s Review
11Severn Trent Plc Annual Report and Accounts 2025 |
Water quality complaints
(number of complaints)
2023/24 7,696
2022/23 7,467
9,0112024/25
9,011
(ODI target: 9,500)
Definition:
The number of complaints about taste,
odourand appearance that we receive
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Leakage
(Ml/d) (three-year average)
2023/24 392
2022/23 405
3712024/25
371 Ml/d
(ODI target: 382 Ml/d)
Definition:
The average volume of water that leaks from
our water network each day (measured as
athree-year rolling average)
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Developer measure of experience
(‘D-MeX’) (Rank)
2023/24 1st
2022/23 3rd
1st2024/25
1st
Definition:
An industry standard view of developers’
experience, measured through both
quantitative and qualitative metrics
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Pollutions
(number of incidents)
2023/24 239
2022/23 193
2742024/25
274
(ODI target: 182)
Definition:
The number of pollution incidents that
occur from our activities
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Water supply interruptions
(average number of minutes)
2023/24 6:40
2022/23 9:10
4:342024/25
4min 34sec
(ODI target: 5:00)
Definition:
The average number of minutes lost
percustomer
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Compliance Risk Index
(‘CRI’) (index)
2023/24 6.19
2022/23 5.65
10.322024/25
10.32
(ODI target: 0.00) (ODI deadband: 2.00)
Definition:
A calculated score for each
compliancefailure
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Internal sewer flooding
(number of incidents)
2023/24 710
2022/23 698
5612024/25
561
(ODI target: 564)
Definition:
The number of sewer flooding incidents
thatoccur inside customer properties
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Customer measure of experience
(‘C-MeX’) (Rank)
2023/24 11th
2022/23 9th
11th2024/25
11th
Definition:
An industry standard view of customers’
experience, measured through both
quantitative and qualitative metrics
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Inspiring our customers to use water
wisely (number of commitments)
2023/24 172,260
2022/23 122,159
165,2772024/25
165,277
(ODI target: 31,050)
Definition:
Number of customers agreeing to change
one or more of the three target behaviours
after participating in an engagement session
as part of our education programme
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Our Performance and Key Performance Indicators
12 | Severn Trent Plc Annual Report and Accounts 2025
Public sewer flooding
(number of incidents)
2023/24 1,831
2022/23 1,526
1,7622024/25
1,762
(ODI target: 1,884)
Definition:
The number of sewer flooding incidents that
occur in public open spaces
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Biodiversity
(number of hectares (‘ha’))
2023/24 11,554
2022/23 7,728
16,2332024/25
16,233 ha
(ODI target: 1,090 ha)
Definition:
The number of hectares of land with
improved biodiversity since 2020
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Help to pay when you need it
(% of customers)
2023/24 56
2022/23 52
622024/25
62
(ODI target: 43)
Definition:
Percentage of our customers who need
oursupport that are part of one of our
affordability schemes
Strategic objectives:
O N P C
Stakeholders: Remuneration:
External sewer flooding
(number of incidents)
2023/24 6,721
2022/23 5,353
7,0182024/25
7,018
(ODI target: 3,397)
Definition:
The number of sewer flooding incidents that
occur in customer gardens, driveways and
external buildings
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Employee engagement
(score out of 10)
2023/24 8.6
2022/23 8.4
8.62024/25
8.6
Definition:
Employee engagement score out of 10
Strategic objectives:
O N P C
Stakeholders:
Lost Time Incidents
(‘LTIs’) (per 100,000 hours worked)
2023/24 0.08
2022/23 0.11
0.092024/25
0.09
Definition:
Number of employees unable to work due
toinjury or illness from their job
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Value for money
(% score)
2023/24 60.0
2022/23 64.4
56.52024/25
56.5
(ODI target: 64.5)
Definition:
Our customers’ view of value for money
measured by a quarterly survey
Strategic objectives:
O N P C
Stakeholders: Remuneration:
Priority Services Register
(‘PSR’) (% of customers)
2023/24 9.2
2022/23 7.7
9.92024/25
9.9
(ODI target: 9.7)
Definition:
Percentage of our customers that require
bespoke support during incidents that are
signed up to our PSR
Strategic objectives:
O N P C
Stakeholders: Remuneration:
NATURE
Key:
Strategic objectives
Outcomes
Nature
People
Change
N
O
P
C
P
E
O
P
L
E
C
H
A
N
G
E
O
U
T
C
O
M
E
S
N
A
T
U
R
E
Performance
Outperformance against target
Underperformance against target
Strategic Report | Our Performance and Key Performance Indicators
13Severn Trent Plc Annual Report and Accounts 2025 |
DELIVERING
OUTCOMES
OUR CUSTOMERS CARE ABOUT
Customer Experience
We are passionate about delivering the best possible service for our
customers, a shared commitment that extends from the frontline to
the boardroom. Our ambition is to deliver a great experience for our
customers in all that we do.
Customer Measure of Experience (‘C-MeX’)
C-MeX is the water industry’s customer satisfaction measure overseen
by Ofwat, which is measured by surveying customers’ experience and
views across four areas: Water, Waste, Retail and Experience.
We are making pleasing progress in two of these areas – Water and
Experience – and are striving to improve our performance within
Waste and Retail. Our C-MeX score improved from 74.18 to 74.42
yearon year, however our position remained static at 11th.
– We have seen a steady improvement in our Water C-MeX
performance over the last three years – through minimising supply
interruptions, improving complaint handling and reducing leakage.
We have made pleasing progress on our leakage journey, with
a16.8% leakage reduction across AMP7, repairing significant
visible leaks 60% faster and reducing fix times from almost
eightdays to just over three days – minimising disruption to our
customers. We have also created a new Customer Inspector Team,
dedicated to supporting customers throughout water jobs, until
theyare completed.
– We are using the learnings from our improvements in Water to
enhance our approach in Waste. We insourced our Waste Infra
Response Team in 2023/24 to give us greater control over speed
and quality of response to customer issues. Our new approach is
yielding positive results and we now resolve jobs much faster, with
30% fewer complaints. We know we can always do more, so we are
currently recruiting an additional 78 people to bolster this team to
enable greater consistency on speed of response during significant
wet weather.
Our services are an essential part of our
customers’ lives. We take this responsibility
seriously and strive to keep water flowing and
continuously take wastewater away, whilst
working with customers to manage demand.
Kraken
Kraken’s advanced AI assistance tools are a game-changer
forthe service we provide to our customers, helping to resolve
customer queries quickly, draft responses and update records
in a single system, resulting in a higher rate of first-time
resolution. Kraken is built on a scalable architecture, meaning
that the platform can grow alongside our business needs.
Additionally, the centralisation of customer data provides
better insight and supports informed business decisions,
driving further improvements.
– In Retail, our focus is on ensuring that our customers can speak to
us quickly, whenever they need to, and have their query resolved.
We have invested significantly in this, and hope to see the benefits
ofour investment in the period ahead. Our migration to the Kraken
platform continues and nearly two and a half million customers
arealready on the new platform. Our remaining customers will
bemigrated in the next few months. We also opened a new fully
insourced customer contact centre in Leicester during the year.
Read more on page 15.
In this section:
14 Customer Experience
16 Water
17 Wastewater
18 Environmental Performance
Customer contact centre, Pride Park
14 | Severn Trent Plc Annual Report and Accounts 2025
– And in Experience, we have focused on improving customer
satisfaction, reputation, value for money and building trust –
particularly in areas our customers care about most, such as CSOs.
You can read more about our CSO Improvement Plan on page 23
and we’re pleased that interventions such as these are helping to
rebuild our customers’ trust in us.
We are at different stages in our improvement journey across each
ofthese areas, however we are confident that our plans are turning
the dial and will deliver the improvements in performance that our
customers expect.
Beyond customer service, we never want our customers to fear their bill
and our relentless focus on affordability support and customer advice
continues. Read more on page 21. This year, we created our Customer
Inspector Team, focused on providing quality advice and support to our
customers – helping them reduce their water usage, reduce their bills
and support our plan to reduce household water consumption.
Developer Measure of Experience (‘D-MeX’)
We are delighted to have maintained our position as the leading
company on D-MeX, holding our first-place ranking this year with
animproved score of 92.05 (based on Q3 results) (2023/24: 91.90).
Since D-MeX was introduced in 2020/21, we have been in the top
threecompanies every year, putting us in a great position for AMP8.
This is another area where insourcing has driven improvements,
withour in-house teams working tirelessly to understand the
differing requirements of developers; providing a tailored approach
toservice delivery, building long-term relationships with larger
developers whilst offering enhanced support and touchpoints for
one-off transactional developer customers.
Inspiring our customers to use water wisely
Our children are our future, which is why we established our
Education Team at the start of AMP6 to teach our children good
habitsaround water and sewer use, as well as about the environment.
Educating children early helps instil lifelong behaviours. Our
Education Team is thriving and, through our programme, we
encourage customers to pledge to use water wisely, utilise
wastewater services appropriately, and drink tap water to avoid
single-use plastic bottles. Each pledge represents an individual
committed to changing their behaviour around water usage, which
helps reduce water demand, prevent sewer blockages, and benefits
the environment.
This year, we collected an impressive 165,277 pledges, the second
highest number ever received in a single year. We have exceeded
ourtarget in all five years of AMP7 and our total now stands at over
500,000 customers who have pledged to use water wisely.
Education Team improving awareness of good water and sewer use
for our future customers
Value for money
We strive to deliver a service that represents value for money for our
customers and are disappointed to see the percentage of customers
rating their bill as ‘good value for money’ dropping from 60% to 57% this
year. We are committed to ensuring our customers receive the good
value service they expect andare improving in areas that our customers
tell us are important to them, such as leakage, supply interruptions,
water quality and blockages. We have also made excellent progress
onour CSO Improvement Plan. Read more on page23.
Leicester customer contact centre
In September 2024, we announced the insourcing of all our
customer service operations, establishing a new customer
contact centre in Leicester and creating 40 new roles. We
worked closely with Leicester Job Centre and Employment
Hubto create pathways for individuals facing barriers to
employment, and 22% of our new recruits fit this profile.
By bringing all of our operations in-house we will benefit from:
enhanced communication, improved service knowledge,
stronger links with our culture and values, more efficient
responses to customer feedback, improved controls, and also
increase our ability to flex and adapt to our customers’ needs
– and provide them with the very best level of service.
We’re confident that this will have a positive impact on the
service we provide to our customers and contribute to an
improvement in our C-MeX performance moving forward.
Help to pay when you need it
We recognise the importance of supporting customers experiencing
financial vulnerability and never want anyone to fear their bill. Our
average household bill for water and waste services this year was
around £457 (£1.25 per day) and is the second lowest in England.
Supporting customers who struggle to pay, or are at risk of struggling
to pay, is fundamental to building customer trust.
Last year, we assisted over 290,000 customers who needed additional
support; this equates to 62% of customers (2023/24: 56%) which is
above our target of 43%. We offer a range of schemes, including
social tariffs, debt write-offs, payment breaks, home water efficiency
checks, fixing private water and wastewater issues (relating to assets
which are normally the customer’s responsibility), grants, payment
plan concessions, and water health checks. Our £575 million AMP8
affordability package will see us help one in six customers with their
bills by 2030 through avariety of schemes, delivering payment
support to those who need itmost.
Priority Services Register (‘PSR’)
Our PSR commitment aims to increase the number of customers
invulnerable circumstances who receive services tailored to their
needs, such as alternative communications and literature, support
with access and mobility restrictions, help during incidents, and
enhanced security during home visits. We strive to reach as many
customers as possible who might need additional support, and we
have over 415,000 households on our PSR. We continually review the
households on our register to remove those who no longer need
assistance, ensuring we focus on customers who need us most.
Thisoffers customers a better, more personalised service catered
totheir individual needs.
We are pleased to report that we have achieved our target for PSR
this year, and have done so throughout AMP7, despite increasingly
challenging targets. Currently, nearly 10% of our customers are
signed up to our PSR, reflecting an increase of over 28,000 from
theprevious year which means we are helping more people than
everbefore.
Liv at Leicester customer contact centre
15Severn Trent Plc Annual Report and Accounts 2025 |
Strategic Report | Delivering Outcomes our Customers Care About
Water
Water supply interruptions
This year, we are delighted to have achieved our best ever performance,
outperforming our stretching 5 minute target, with a performance of
4 minutes 34 seconds, marking an improvement of over 30% from last
year. This improved performance is the result of significant investment
in our water network and the introduction of our Network Response
Team during the AMP, providing resilience to increasingly frequent
extreme weather events, such as Storm Darragh in December 2024.
Similarly, we managed the winter freeze-thaw with significantly less
impact on customers through applying learnings from prior events.
This improved response has had a positive impact on our supply
interruptions performance and also leakage.
Our insourced Network Response Team has targeted improvements
on the impact of medium-sized events. This activity has proven
beneficial and has been the main driver of our performance
improvement. Additionally, we have made significant strides in
reducing the impact of outlier events over AMP7, reducing supply
interruptions for our customers, and we are pleased to have
sustained the decrease this year.
Leakage
We are thrilled to have outperformed our AMP7 leakage target, achieving
a 16.8% reduction over the AMP from our three-year average baseline
set in 2019/20. This puts us on a positive trajectory as we enter AMP8,
targeting over 30% leakage reduction by 2030 and 50% reduction by
2045. Our performance this year reflects a year-on-year annual leakage
reduction of 28 Ml/d, and achieving our lowest ever level of leakage at
335.1 Ml/d. Our resilient operational performance has enabled us to
meet our target for 13 out of the last 14 years, with learnings from the
‘beast from the east’ in 2018 being embedded tominimise the future
impact on customers of such extreme weather events.
We have increased our focus on finding and fixing leaks, with
60,000repairs carried out this year, an increase of over 5% from
lastyear. We are also repairing significant visible leaks faster than
ever before, with an average end-to-end job completion time of
threedays, including site reinstatement and clearance, reflecting
animprovement of over 60% across AMP7 and meeting our target
every year. Additionally, we continue to renew our water network
anddeliver pressure management schemes to stabilise the network
and reduce leaks caused by high network pressure.
Per Capita Consumption (‘PCC’)
Whilst we have sustained a PCC reduction over AMP7, despite
anumber of challenges – including the COVID-19 pandemic, increased
home working and heightened hygiene measures – we missed our
regulatory target this year. The installation of water meters will be
key to further progress – as providing customers with meters
significantly improves demand management by reducing customer
usage and identifying leakage. Over AMP7, we have installed over
500,000 meters – this includes the roll out of over 180,000 smart
meters which provide more information, greater transparency,
increased data accuracy and have reduced PCC by 3.7 Ml/d.
Buildingon this progress, we will install over 1 million meters in
AMP8 to support further reductions in PCC and improve long-term
water resources, supply/demand balance and reduced reliance on
water abstraction.
Alongside our metering activity, we maintain a positive, continual
dialogue with our customers, engaging with them directly on demand
management through our water efficiency programme. We have
completed over 84,000 home water efficiency visits in AMP7,
achieving a 13.3 Ml/d water efficiency saving. Additionally, over
245,000 customers have engaged with our water-saving survey
platform, Get Water Fit.
Smart meter data
We are using AI and smart meter data to identify private side
leakage, reducing customer bills and reducing PCC.
Water quality complaints
We had a total of 9,011 drinking water quality complaints this year,
which was better than our regulatory target, meaning we have
achieved our target for every year of AMP7. However, we continue to
target year-on-year improvements through our mains cleansing and
flushing programme and increased usage of automated designs using
network analytics, enabling us to produce instant flushing plans
during water quality events to reduce impacts for customers, and
deliver proactive messaging when undertaking flushing in their area.
Compliance Risk Index (‘CRI’)
Water quality standards in the UK are some of the highest in the world
and whilst our performance benchmarks well against global peers,
weare disappointed to have missed our CRI score this year – with
ourCRI score increasing year on year from 6.19 to 10.32. This level
ofperformance is not where we want to be, and is driven by asset
failures at a number of our largest water treatment works, primarily
Strensham. We are implementing activities to mitigate against future
impacts, including accelerating the deployment of ultraviolet (‘UV’)
technology at Strensham, and creating a dedicated in-house Water
Quality Commissioning Team to review options to accelerate longer-
term asset and process improvements.
While total sample failures have also increased to 148from 122 last
year, weare working to understand bacteria within our processes.
Using online flow cytometry, which provides live data onwater
quality, has enabled us to deliver improvements at our distribution
service reservoirs. We have also refreshed our dedicated
improvement plan, CRI Sustainability Plan, with the objective
oferadicating high-impacting events in ourwater network and
addressing bacteriological risk at water treatment works.
Tap water forensics
As part of an Ofwat innovation funded research project, we are
combining genomic sequencing with AI technology to analyse
water quality at our water treatment works. These insights are
helping us enhance our treatment processes.
No dig technology
Maintaining and upgrading underground infrastructure can
pose significant challenges. Traditional methods involve
disruptive excavation processes that can impact customers,
communities, businesses, and the environment. No dig
technology presents an innovative, non-disruptive and
cost-effective solution, eliminating the need for excavation.
This technology is being deployed to support our leakage
reduction target of 50% by 2045.
A unique solution comprising water, food-grade gellant, and
engineered calcium carbonate particles is injected into a pipe
in the boundary box and forced under pressure directly into
theleak, sealing it quickly and effectively.
This new technology enables us to quickly reinstate mains
withminimal interruption to water supply, ensuring a more
continuous and reliable service for customers. Repairs
thatwould normally take two to three days now only take
20-30 minutes on average, and with around 200 leaks
successfully repaired during our trial, we are now exploring
how to roll out this technology across the business.
200
leaks successfully repaired during our trial
Delivering Outcomes our Customers Care About continued
16 | Severn Trent Plc Annual Report and Accounts 2025
Wastewater
Sewer flooding
The last 12 months have seen extremely challenging weather
conditions, as reflected in the increase in wastewater volumes
treated this year – driven by the higher than average rainfall in our
region over the year. We treated 3.34 billion litres of wastewater
perday compared with an average of 3.06 billion litres per day for the
first four years of the AMP. Our teams have worked determinedly in
particularly challenging conditions this year to keep our services
operating efficiently and reduce the impacts on our customers and
the environment. However, we recognise that there is more we can
doto deliver the improvements our customers expect.
We have achieved our best ever internal sewer flooding performance,
improving 20% year on year, however it is still not where we want it
tobe as we strive to be the leading company on this important waste
measure. To drive further improvements, a member of our Executive
Committee reviews every single incident to understand the cause and
support investment activity (for example, our insourcing of waste
reactive services).
External sewer flooding remains a key focus, and we are disappointed
not to have delivered against our stretching target (which is the most
demanding in the sector) this year, with our performance broadly in
line with last year at 7,018 external flooding incidents, of which 709
were hydraulic incidents and 6,309 flooding other causes (‘FOC’).
Despite this, we are confident that we will continue to be sector
leading for external sewer flooding performance. There are two
mainfactors that drive performance – blockages, which can occur as
aresult of sewer misuse, and hydraulic flooding, due to heavy rainfall.
We review any repeat hydraulic incident with the aim of installing
mitigation measures to prevent future customer impacts.
We understand that any flooding is not acceptable for customers, so
we have made improvements to our waste operating model, ensuring
we have the right number of crews at the right time, to drive quicker
response to reported flooding incidents and blockages which, if not
dealt with effectively, have potential to cause flooding incidents, and
complete effective follow-up activities such as CCTV investigations
and permanent fixes. We are also supporting customers in vulnerable
circumstances and have updated our policy this year. We have also
created more than 20 community flooding liaison roles, to work with
local groups to improve our flooding response, build relationships
and improve local resilience plans.
Finally, we have outperformed our public sewer flooding target every
year in AMP7 since the measure’s creation, and this year we have
beaten our target by over 6%.
Storm intelligence
We have developed an AI-based platform to support our
Network Control Team to manage weather-related incidents.
Using AI-boosted modelling, we can predict our sewer network
response to storms. This helps us deploy resources before
storm overflow spills, pollutions or sewer floodings occur.
Sewer blockages
We are continuing to see the benefits of insourcing our Waste Infra
Response Team, which has given us greater internal control over
thequality of work delivered. This has enabled us to reduce repeat
blockages, a leading cause of FOCs. Additionally, insourcing has
improved our response time to blockage jobs, reducing the chance
ofblockages causing flooding as we can take action before customers
are affected by internal or external flooding. To reduce impacts driven
by blockages caused by sewer misuse, we are continuing to work in
partnership with food service providers to ensure the appropriate
disposal of fats, oils, and greases (‘FOG’), preventing them from
entering the sewage system and causing blockages.
This year, we achieved our best ever performance on sewer blockages,
with 28,062 blockages, surpassing our target by over 30%. We
continually seek out new technologies and innovation to improve our
approach and this year we introduced the Stickleback, a device designed
to tackle blockages caused by items like wet wipes. The Stickleback
isstrategically placed in sewers to capture these items, preventing
blockages and potential sewage backups. Alongside its deployment,
welaunched a public awareness campaign emphasising the message
‘be a binner, not a blocker’, encouraging proper wastedisposal.
The Stickleback in action
Pollution incidents
Despite the performance improvements made in some areas, we
knowthere is more we can do to improve our pollutions performance.
We want to deliver faster improvements and have set bold targets to
drive performance improvements, supported by scale investment plans
and weekly Executive Committee oversight of individual measures. Our
serious pollutions performance is green against the EPA target with
onereported in the year, however ithas been another challenging year
for our overall pollutions performance. We experienced 274 pollutions
(2023: 239), and disappointingly did not meet our target this year.
Despite a strong start on our PIRP in AMP7 and achieving zero serious
pollutions in 2023, we have not achieved the sustained total pollution
reduction performance we set out to. Earlier this year, we redefined
ourPIRP for 2025-30, supported by a £400 million investment over
thenext two years todeliver the step change in performance that
ourstakeholders expect. Our investment will improve our resilience
andspeed of response, and ultimately our performance, through the
following activity:
– Creation of a new waste operational control centre – focused
onalarm monitoring and management, response to events and
implementing immediate solutions ahead of permanent solutions
being implemented, such as overpumping. Read more on page 18.
– Recruiting a dedicated Repeat Prevention Team of technical experts
to assess and permanently fix any issues – this team will improve
our speed of response to events, to ensure zero repeats. They will
also triple our volume of proactive interventions such as cleansing
and lining and undertaking complex repairs in-house.
– Improving the standards and capacity at Sewage Pumping Stations
(‘SPS’) – improving 400 SPS, ensuring we eliminate the risk of
repeat incidents from these assets.
– Deploying new technology and innovation at scale – for example
oninfiltration schemes to reduce the hydraulic pressure on our
network and help reduce pollutions, spills and sewer flooding.
– Increased focus on asset monitoring and maintenance, such as
screw pumps, to prevent pollutions events.
All of this activity will be supported by the skills and expertise of our
people, assisted by specific training delivered though our Academy –
including immersive training using our pollutions training river, which
provides frontline operatives with hands-on experience in dealing
with various types of pollution incidents, helping to reduce potential
environmental impacts.
Scan the QR code to
download our Pollution
Incident Reduction Plan
17Severn Trent Plc Annual Report and Accounts 2025 |
Strategic Report | Delivering Outcomes our Customers Care About
Waste operational control centre
Environmental Performance
Environmental Performance Assessment (‘EPA’)
We have achieved the highest possible EPA rating of 4* for the last five years, and we are confident that we will achieve this rating again for
2024, making it six consecutive years and every year of AMP7 – which is unprecedented across the sector. No other company has ever achieved
more than three consecutive years at 4* status.
1 Confident of achieving 4* status, awaiting sign-off by the EA.
Calendar Year 2019 2020 2021 2022 2023 2024
EPA rating 4* 4* 4* 4* 4* 4*¹
Finham Wastewater Treatment Works
Our new waste operational control centre is a state-of-the-art
facility designed to revolutionise waste management, by
responding to and effectively addressing waste incidents
acrossour network. This innovative hub aims to enhance decision
making through real time data analysis and the development
ofnew methods to improve waste resilience. Itrepresents
atransformative step in waste management and has created
40new jobs, providing promotion opportunities for existing
employees. The increased workforce allows us to focus even
moreon improving our performance in handling pollutions and
spills to meet the expectations of our customers and regulators.
This advancement in waste management uses an advanced
incident tracking system, enabling the logging and monitoring
ofwaste incidents in real time to swiftly identify and respond to
incidents, ensuring prompt resolution and minimising disruption
to our customers and the environment.
We are confident that this will have a positive impact on the service
we provide to our customers and contribute to an improvement in
our C-MeX score moving forward.
2024 EPA performance 2024 EPA green target 2024 performance 2024 status
Serious pollution incidents 1 or below 1
1
Green
Pollutions incidents 191 274 Amber
Discharge permit compliance 99.0% 99.5% Green
Self-reported pollutions 80% 90% Green
Water Industry National Environment Programme (‘WINEP’) delivery 100% 100% Green
Supply Demand Balance Index 100 100 Green
Satisfactory sludge use and disposal 98.2% 100% Green
1 The EA classified this incident as Category 2 under the Common Incident Classification Scheme, based on elevated ammonia levels along the length
ofadrainage ditch. However, we have seen no evidence of any consequential harm caused by the elevated ammonia.
The EA has confirmed the methodology for EPA is changing from 2026 and we are therefore expecting it will become significantly harder
toachieve a 4* rating. We are shadow reporting the proposed new measures to position us strongly for the future EPA regime.
Delivering Outcomes our Customers Care About continued
18 | Severn Trent Plc Annual Report and Accounts 2025
CARING FOR
PEOPLE
IN OUR REGION
Building our Future Skills
We are dedicated to building our future skills by investing in new talent
and we take a unique and personal approach to recruitment. Byusing
our in-house model, even for senior roles, we get to know our candidates
better and give them a thorough understanding of our company and
culture. This approach helps us create better job and career matches,
andallows us to find and attract top talent moreeffectively.
Our commitment to meeting future skills needs is reflected in our wide
array of new talent programmes. We now offer our broadest range of
new talent programmes, including roles in support functions, operations
and engineering and continue to invest in key skills areas, such as cyber
security, environmental management and process engineering.
This year, we have introduced new programmes in strategy and
regulation and environmental management to develop future leaders.
These programmes have been instrumental inenhancing diversity;
our Operational and Environmental Leadership Programme
continues to improve our genderdiversity, with 57% of participants
being female.
Work experience is a critical component of our future skills strategy.
To support this, we have hosted 90 individuals through paid work
placements and internships during 2024/25 and provided over 95
students with unpaid work experience opportunities.
We also have three interns on our annual programme with Derwen
and Hereward Colleges, which is designed to support students with
special educational needs and disabilities (‘SEND’) to gain first-hand
work experience.
Whilst we ensure we attract the right external talent, we are also
committed to supporting internal promotions and succession forms
the foundation of our approach to building skills and leadership
resilience in our organisation.
Currently, 55% of our vacancies are filled internally. In the last two
years, 20% of employees have progressed to a broader role or been
promoted, with over 400 of these colleagues moving from frontline
oradvisory roles to Team Manager or Technical Expert level and over
56 promotions to Business Leader or Senior Professional level roles.
Our in-house Academy allows us to adapt and refine our training
approach in response to regulatory or technology changes. The
versatile facilities provide a variety of traditional and experimental
training environments, offering a safe place for our colleagues to
build essential practical and technical skills to better serve our
customers and communities.
Providing a Diverse and Inclusive
Place to Work
We celebrate diversity and inclusion and embrace individuals’
contributions, no matter what their age, gender, race, ethnicity,
disability status, sexual orientation, social background, religion
orbeliefs.
By employing, valuing and investing in a range of local talent with
different backgrounds, experiences and perspectives, we can build
askilled workforce that can really understand and empathise with
allour customers and communities, and deliver our services in the
way they want them.
We are proud of our track record on gender diversity, and we were
delighted that Severn Trent achieved second place for representation
of women on the Board in the FTSE Women Leaders Review 2025.
Our people work tirelessly every day in
their commitment to taking care of one
of life’s essentials.
In this section:
19 Building our Future Skills
19 Providing a Diverse and Inclusive
Place to Work
20 Rewarding and Looking After
ourPeople
21 Supporting our Customers
21 Creating Opportunities in
ourRegion
You can read about how we have engaged with and listened to
ouremployees throughout the year in our dedicated stakeholder
engagement section entitled ‘Engagement in Action – Our
Colleagues’, on page 86.
19Severn Trent Plc Annual Report and Accounts 2025 |
Graduates at Severn Trent Centre
As at 31 March 2025, our Executive Committee comprised four female
and five male members (44.4% and 55.6% respectively). 21 (45.7%) of
our Senior Leaders (including our Executive Committee) were female
and 25 were male (54.3%). Female representation in the Group was
29.0% (2,849 women), with male representation at 71.0% (6,997 men).
Five members of our Board, including the Chair, were female (62.5%)
and three were male (37.5%). The table below sets out a gender
breakdown of Directors, Senior Managers (as defined in the 2018 UK
Corporate Governance Code and Companies Act 2006) and employees
of the Company as at 31 March 2025.
Rewarding and Looking
AfterourPeople
Fairly rewarding our people
All employees share in our success through our all-employee
bonusplan, aligning everyone with key objectives and rewarding
achievements. We offer a market-leading defined contribution
pension scheme, doubling employee contributions up to 15% of
salary. Additionally, employees can become part-owners through
ourpopular Sharesave Scheme, with over 70% participation and many
saving the maximum £500 per month. We are especially delighted
that so many employees choose to retain their shares, reflecting
theircommitment and belief in our Company’s future.
Gender representation: As at 31 March 2025
Directors Senior Leaders Graduates and Apprentices All Employees
Number % Number % Number % Number %
Female 5 62.5 21 45.7 80 23.1 2,849 29.0
Male 3 37.5 25 54.3 266 76.9 6,997 71.0
Ethnicity representation: As at 31 March 2025
Directors Senior Leaders Graduates and Apprentices All Employees
Number % Number % Number % Number %
Asian/Asian British 1 12.5 4 8.7 63 18.1 764 7.8
Black/African/Caribbean/
Black British – – – – 16 4.6 249 2.5
Mixed/Multiple Ethnic Group 1 12.5 1 2.2 15 4.3 187 1.9
Other Ethnic Group – – – – 4 1.2 67 0.7
Not specified/prefer not to say – – – – 46 13.2 1,212 12.3
White British or Other White
(including minority-white groups) 6 75.0 41 89.1 204 58.6 7,367 74.8
You can read about our approach to Board diversity in our Nominations Committee Report on pages 114 to 118.
Looking after our people
The wellbeing, health and happiness of
ourpeople is important to us and, as such,
we have an array of wellbeing campaigns,
initiatives and services available to support
their physical, mental and financial
wellbeing. By embedding wellbeing into our policies, we foster
apositive and engaging work environment.
Our organisation has grown significantly this year, as we insourced
more teams. And we have ensured that as part of the onboarding
process, our new joiners understand our policies and ways of working
– including in relation to health and safety. As outlined on page 13, we
have had another strong year on our health and safety performance
– with 17 LTIs this year, compared to the previous year of 14,
representing an LTI rate of 0.09 per 100,000 hours worked this year.
This is industry-leading performance, despite a significant increase
inheadcount during the year.
Remuneration
The Directors’ Remuneration Report sets out the steps we
taketo make sure that our pay and reward framework, below
Executive and Senior Management, is transparent, meaningful
and useful for stakeholders.
You can read more on pages 131 to 154.
Unfortunately, there was a serious health and safety incident
inMarch2025 involving an employee of one of our framework
contractors. The incident occurred at one of our sites which was
under the control and responsibility of the contractor and sadly
resulted in the death of a contractor employee. As at the date of
thisreport, we understand that the investigation into the incident
remains ongoing. Neither the Group nor its employees is subject
tothe investigation.
Following the incident, we engaged across the Group’s framework
contractors and direct supply chain to re-emphasise the importance
ofour fundamental health and safety expectations and our
‘EverybodySafe’ mindset and culture.
We continue to have a strong
presence in key indices, including:
9th
on the Social Mobility Index, placing us in the top 10 for the sixth
year running
4.5/5
Glassdoor ranking
In 2025, we were delighted to be named
awinner of Glassdoor’s annual Employees’
Choice Awards, honouring the ‘Best Places
to Work’ in the UK. Severn Trent was the
highest ranked water company and rated 29th
out of 2.8 million companies on Glassdoor.
Caring for People in our Region continued
20 | Severn Trent Plc Annual Report and Accounts 2025
Our gender and ethnicity pay gap
In March 2025, we published our third combined Gender
andEthnicity Pay Gap Report.
This year, our median gender pay gap slightly increased from
7.8% to 8.2%. This increase is mainly due to our decision to
insource more of our wastewater activities. Our mean gender
pay gap, however, reached its lowest level at 1.9%. This
continues to be driven by the high proportion of women in
ourmanagement and senior management roles.
In our third year of publishing our ethnicity pay gap information,
both the median and mean gaps have increased to 10.1% and
7.6%, respectively. We have seen continued progress on the
representation of ethnic minorities in our workforce (up to
13%from 12%) and in our Gender and Ethnicity Pay Gap Report,
available on our website, you can read more about the actions
we are taking to increase minority ethnic diversity at more
senior levels, including both the nurturing of internal talent
andthe identification and attraction of external talent.
Further information regarding employee pay can be found
inour Directors’ Remuneration Report on pages 131 to 154.
Supporting our Customers
To be truly impactful in our communities, we need to help more of our
customers who need support today. Our average combined bill for the
year remains the second lowest in England. Even though our bills are
low, some customers have difficulty paying and we make it clear to
our customers that we do not want anyone to fear their bills.
So far this year we have provided over £88 million of support for
around 290,000 of our customers. Between 2025 and 2030, we are
doubling the number of households who might be eligible to receive
financial help with a new £575 million package of support. That means
around one in six customers across our region, or nearly 700,000
households, could receive help with their bills.
In respect of our vulnerable customers, we also aim to reach out to as
many customers as possible to find those who might need additional
support from us. We now have 9.9% of our customers signed upto
ourPSR. Our PSR ensures those who need additional supportare
prioritised during an incident so we can provide them with bespoke
communication and a personalised service.
Scan the QR code todownload our
Customer VulnerabilityStrategy
Delivering social impact
Our Societal Strategy, launched in 2022 to reach 100,000
people in, or at risk of, water poverty by 2030, aims to
improve life chances through access to high-quality
employment-related training and career opportunities.
Maintaining our focus in areas of high deprivation in our region,
we have expanded our schools programme withemployability
training, mock-interviews, career assemblies, unpaid work
experience and discovery days. Our corporate volunteer offer
continued to grow with the introduction of NeighbourGOOD
thisyear, where local organisations can apply for Severn Trent
volunteer time and a small grant. This year, we have also
launched our Learning, Employability and Preparation initiative
to create pathways into roles atSevern Trent for people who
may have barriers to work.
Creating Opportunities
in our Region
Social Mobility Index
We have officially been named as one of the country’s top performing
companies for improving social mobility. For the sixth year running,
we have been placed in the top 10 on the Social Mobility Index, coming
in at9th place out of 75 companies.
The Social Mobility Index, which is in its eighth year, ranks UK
employers for their commitment to making sure those from all
socialbackgrounds have access to the same opportunities.
Community Fund
In our 2020-25 Business Plan, we pledged to create a new Severn
Trent Community Fund that donates 1% of Severn Trent Water’s
annual profits after tax (more than £10 million over five years) to
goodcauses in our region.
In 2024/25, the Community Fund awarded over £2 million to over
113organisations. Since the Community Fund’s inception, we have
awarded over£11 million to 896 organisations across our region.
Scan the QR code todownload our
Community Fund Annual Review
Fair pay and working conditions
We are proud to be an accredited Living Wage Employer. We also
contractually require all our suppliers to sign up to the real Living
Wage. We are committed to paying suppliers on time and giving clear
guidance on payment terms. We aim to pay 95% of our small suppliers
within 30 days, in line with the principles of the Fair Payment Code.
For the payment practices reporting period ended 31 March 2025,
theaverage time to pay for Severn Trent Water was 34 days.
Living Hours is a newer concept designed to ensure that workers
areon contracts where they can earn enough tosupport a decent
standard of living. In April 2024, webecame an accredited Living Hours
employer. The standards to which it holds employers to account
includes: a right toacontract which reflects the hours worked; offering
a minimum of 16 hours per week (employees can request less); and
providing at least four weeks’ notice of a change toworking patterns.
21Severn Trent Plc Annual Report and Accounts 2025 |
Strategic Report | Caring for People in our Region
A DRIVER OF POSITIVE
CHANGE
Get River Positive
In 2022, we launched our Get River Positive campaign alongside
Anglian Water and Hafren Dyfrdwy as part of our commitment
toreduce our environmental impact on rivers and ensure their
long-term health. At the heart ofthisindustry-leading initiative
arefive ambitious pledges as detailed below.
Since its inception we have delivered strong results and our
focusonmaking further improvements continues, supported by
collaboration with all of our stakeholders, sustained investment
andpositive community engagement. We understand the importance
ofour environment and will continue to focus on rivers, seeking to
innovate and invest in more sustainable solutions for a resilient
futureforrivers.
To find out more about how we are making a difference to rivers in
ourregion, subscribe to our quarterly newsletter via our website.
The world we operate in and the needs of
ourcustomers and society change continually.
We seek to embrace the challenges and
opportunities this presents, not only driving
change in what we do, but also acting as
acatalyst in our sector, our region and for
thepeople we serve.
In this section:
23 Get River Positive Pledge 1
24 Get River Positive Pledge 2
24 Get River Positive Pledge 3
24 Get River Positive Pledge 4
25 Get River Positive Pledge 5
26 Green Recovery
PLEDGE 1:
ensure storm overflows
and sewage treatment
works do not
harmrivers
PLEDGE 2:
create more
opportunities for
everyone to enjoy our
region’s rivers
PLEDGE 3:
support others to
improve and care
forrivers
PLEDGE 4:
enhance our rivers and
create new habitats so
wildlife can thrive
PLEDGE 5:
be open and transparent
about our performance
and our plans
River Ranger sampling
22 | Severn Trent Plc Annual Report and Accounts 2025
Overflow to watercourse
Wastewater
from
businesses
Wastewater
from
homes
Drainage
from roads,
highways and
public spaces
To wastewater treatment works
PLEDGE 1:
ensure storm overflows and sewage treatment works do not harm rivers
Submerged aerated filter units at Lower Moor Wastewater Treatment Works
Operational
Optimisation
Innovation Centre
We recently announced the creation
ofour Operational Optimisation
Innovation Centre (‘O2IC’) at our
Alfreton wastewater catchment.
Thiscutting-edge facility has been
designed to mirror the success of
ourResource Recovery and Innovation
Centre (‘R2IC’) at Spernal, which has
positioned us as global leaders in the
measurement and management of
greenhouse gas emissions in the
watersector. The O2IC will act as
ourpermanent test facility to
combineAI solutions, operational
andengineering technologies, within
asingle wastewater catchment.
Thiswill createa unique opportunity
todevelop, monitor and refine
AI-driven innovations such as real
timemonitoring, predictive
maintenance and optimisation of
treatment processes, in a structured
environment. This initiative will
alsoenable us to understand and
address the people and process
transformations needed for
successfulimplementation, as well
asrigorously testing the functional
safety and security of AI solutions
toensure safety and environmental
risks are properly managed.
Like many other countries, the UK’s
sewerage system was designed as a
combined system, with a single piped
network which collects wastewater
from homes and businesses and also
collects rainwater from roofs, roads
and other hardstanding areas.
Scan the QR code to visit
our dedicated YouTube
channel which has a range
of videos demonstrating
improvements made
across our region
Storm water storage tank installation
atTrescott Wastewater Treatment Works
What are CSOs?
River health is declining across the UK, with
only 14% achieving Good ecological status.
Our Get River Positive pledges are critically
important to us as they represent our
commitment to river health. By addressing
spills, reducing pollution, and investing
significantly in river health, we will protect
and restore the natural beauty and
biodiversity of rivers in our region, ensuring
asustainable future for generations to come.
Our operational area includes over 778
waterbodies. We reduced our contribution to
RNAGS in our region’s rivers to 14% in 2023,
a significant improvement. Through our work
installing complex schemes over the last
12 months, our RNAGS contribution has
reduced further to 10.8% and we are on track
to meet our goal of less than 2% by 2030.
Despite the ongoing challenges of climate
change, such as extreme weather patterns
and significant flooding, our customers
expect us to be resilient to climate change
and extreme weather impacts and continue
to reduce our impact on rivers in our region.
In May 2024, we announced our industry-
leading CSO Improvement Plan, with the
objective of improving our wastewater
network and reducing storm overflow usage.
Over the last year, our teams have worked
hard to implement over 1,200 permanent
enhancements to eliminate spills from storm
overflows across our region, bringing our
total to over 1,800 since work commenced.
This reflects excellent progress against our
initial commitment to deliver 900
enhancements by December 2024.
By Autumn 2025, we will have completed
more than 2,100 enhancements. The scale
ofthe project has been made possible by
anew dedicated team of 500 people across
our organisation and the supply chain. We
have delivered an average of 34 projects per
week since June 2024, ranging from new
storm water storage tanks, innovative
wastewater treatment solutions to capture,
store and treatflows and flap valves to
prevent river inundation when river levels
rise during periods of flooding. Early analysis
shows ourinvestment is working – and
ourimprovements have helped prevent
thousands of spills last year alone, despite
arecord year of rainfall and extreme
weatherevents resulting in an average
of25.4 spills in the year.
We are proud that this huge engineering
programme, delivered at speed, has put us
on track to reduce the average number of
spills from storm overflows by over 25%
from our 2024 levels, reducing spills to an
average of 18 per year by December 2025.
23Severn Trent Plc Annual Report and Accounts 2025 |
Strategic Report | A Driver of Positive Change
PLEDGE 2:
create more opportunities
foreveryone to enjoy our
region’srivers
Carsington Reservoir open water
swimmingevent
The health of our rivers is important to our
customers and communities and their
wellbeing. In recent years, more and more
people have been using the rivers in our
region and that is why Pledge 2 of our Get
River Positivecampaign is so important –
itisnot onlyabout providing opportunities
forrecreational activities across our estate
but also ensuring that our investments
leadto cleaner, safer, and more vibrant
waterways for all to enjoy.
Our £78 million investment as part of our
Green Recovery Bathing Rivers programme
delivered innovative wastewater treatment
technology at Ludlow, Itchen Bank, and
Frankton. Using innovative ozone technology,
this work has reduced our impact on rivers
inShropshire and Warwickshire. Read more
on page 26.
We are also committed to enhancing
recreational activity opportunities at our
visitor sites. This year, we were pleased to
host our inaugural controlled open-water
swimming event at Carsington Reservoir
inDerbyshire, which saw participation
fromalmost 300 swimmers. Following the
success of the event, we are developing
future plans for recreational activities at
otherreservoirs and hosting our first
triathlon event at Carsington Reservoir
on13 July 2025 with British Triathlon. We
areworking closely with the sailing, angling
and paddle clubs based at ourreservoirs.
Swimming at our reservoirs is just one way
we have interacted with local communities.
Our partnership with the Clean Water Sports
Alliance has continued this year and we have
engaged with clubs and organisations who
use our region’s rivers for sports and
recreational enjoyment, to understand
theirperspectives and help inform our
futureactivities.
PLEDGE 3:
support others to improve
andcarefor rivers
River Leam
Collaboration with others is crucial to
restoring river health – no single
organisation or group can solve the issue
single handedly. We know that by working
with other industries, local communities and
river-user groups and schools we can have
abigger impact on improving river health.
Whether it is funding restoration projects,
partnering with local wildlife trusts, or
collaborating with farmers to minimise their
impact on rivers, we want to work together
tomake a difference.
Our Community Fund has an important role
to play, with more than £748,000 awarded
over AMP7 to projects that enhance and
improve river health. One of our largest
contributions has helped the Friends of
Bennerley Viaduct to continue transforming
aonce derelict, fly-tipping hotspot into
athriving heritage and green space. After
50years of closure, the viaduct has been
reopened to the public, with more than
13,000 people – including 2,900 children –
engaged in a variety of programmes over
thelast three years. Our donation of £74,500
will support the development of a new visitor
centre and a new rewilding scheme to boost
biodiversity as well as provide a much
improved community space to enjoy.
Our continued partnership with farmers
inour region has enabled us to safeguard
water quality through various programmes
and grants, including our Severn Trent
Environmental Protection Scheme (‘STEPS’).
In the past year, we have awarded 166 STEPS
grants, worth almost £2 million, for on-farm
improvements that help protect water
qualityby reducing pesticide, nitrate and
cryptosporidium from reaching raw
watercourses. 83% of farmers involved told
us that they are very satisfied with our
collaboration, and 89% believe the on-farm
changes made through our schemes will
benefit the environment.
PLEDGE 4:
enhance our rivers and create
newhabitats so wildlife can thrive
River Rangers in Leamington
Our dedicated River Rangers work tirelessly
to improve the health of our rivers through
monitoring water quality across rivers,
streams and brooks in our region. Their work
includes regular inspections, water-quality
testing, and conservation activities to
support local wildlife and habitats. In the
past year, our River Rangers have carried
outover 4,300 inspections, taking the
totalnumber of inspections to more than
10,000 since the team’s inception in 2022.
Furthermore, they have attended more than
420 external stakeholder meetings, reaching
nearly 2,500 people in relation to river health.
In collaboration with several environmental
groups, including wildlife trusts across our
region, our river restoration projects have
ranged from small scale, such as simple log
dams, to more complex mitigations, including
eel and fish passes, all with the objective of
reducing the volume of structures and water
restrictions on our waterways.
We have also made good progress with our
Great Big Nature Boost scheme, improving
the biodiversity of over 16,200 ha across
theregion – more than double our original
goal. This reflects our commitment to
environmental stewardship and our
dedication to enhancing the natural beauty
and biodiversity in our region. Read more
about this and other biodiversity projects
onpage 28.
River Rangers celebrate 10,000 visits
A Driver of Positive Change continued
24 | Severn Trent Plc Annual Report and Accounts 2025
PLEDGE 4:
enhance our rivers and create
newhabitats so wildlife can thrive
River Rangers in Leamington
Our dedicated River Rangers work tirelessly
to improve the health of our rivers through
monitoring water quality across rivers,
streams and brooks in our region. Their work
includes regular inspections, water-quality
testing, and conservation activities to
support local wildlife and habitats. In the
past year, our River Rangers have carried
outover 4,300 inspections, taking the
totalnumber of inspections to more than
10,000 since the team’s inception in 2022.
Furthermore, they have attended more than
420 external stakeholder meetings, reaching
nearly 2,500 people in relation to river health.
In collaboration with several environmental
groups, including wildlife trusts across our
region, our river restoration projects have
ranged from small scale, such as simple log
dams, to more complex mitigations, including
eel and fish passes, all with the objective of
reducing the volume of structures and water
restrictions on our waterways.
We have also made good progress with our
Great Big Nature Boost scheme, improving
the biodiversity of over 16,200 ha across
theregion – more than double our original
goal. This reflects our commitment to
environmental stewardship and our
dedication to enhancing the natural beauty
and biodiversity in our region. Read more
about this and other biodiversity projects
onpage 28.
River Rangers celebrate 10,000 visits
PLEDGE 5:
be open and transparent about our performance and our plans
River Linney
Over the last year, we welcomed new
members to our Get River Positive
Independent Advisory Panel to include Stuart
Singleton-White from the Angling Trust, and
a member of the Clean Water Sports
Alliance, and Alison Biddulph, who led the
Bathing Waters Designation in Shropshire.
The expertise and commitment of our
Advisory Panel is a key contributor
toinforming our approach to protect and
enhance river health. The Advisory Panel’s
insights and constructive challenge has been
hugelybeneficial.
We are committed to reporting our
performance transparently to our customers,
communities and wider stakeholders and
thisyear saw the launch of our Storm
Overflow Map in April 2024, which was
amajor milestone. The map provides a near
real-time view of the data from our
EventDuration Monitors (‘EDMs’) and is
underpinned by over 300 million data points.
Based on feedback from our Advisory Panel
and other stakeholders, we further enhanced
our map in February 2025 to provide detail of
our planned and completed investments for
each overflow.
We also launched the National Storm
Overflow Hub in December 2024 in
collaboration with the Stream open data
initiative and other water companies.
TheHub collates data from all English water
companies into one dataset, providing the
public with access to nationwide data, which
they can download and utilise as needed.
Inthe year ahead, we will publish our open
data strategy on our website, to provide
transparent insights into our open data
engagement principles.
We have continued our partnership and
collaboration with citizen scientists and
otherinterested parties, such as the Severn
Rivers Trust, to support others to better
understand river water quality. This includes
investigating methods for citizen scientists
totest for bacteria in water and interpret the
results. Working with our laboratories and
the River Protection Team, we have trialled
more than six testing methods and are
nowclose to developing a tool that citizen
scientists can use. This programme is due
tobe completed in September 2025.
We will be investing a further £2 billion over
the next five years to improve river health.
We are also committed to enhancing
transparency by installing around 1,000 river
water quality monitors across our region
by2030. Applying learnings from our Storm
Overflow Map, wewill explore how to
effectively share thisinformation with
ourcustomers, communities and other
interested stakeholders on our website.
Furthermore, we have committed to ensuring
we are open and transparent and provide
information on our EDM performance on
ourwebsite in an easily accessible format.
Our data is published annually at present
andwe are pleased to commit to publishing
our EDM data quarterly moving forwards,
with the aim of reporting it monthly before
the end of the year.
Charlton Kings
At Charlton Kings in Gloucestershire,
we have been making upgrades to
ourCSOs, delivering smarter, more
efficient ways to reduce spills and
improve riverhealth.
After carrying out detailed flow
investigations, we designed a solution
to improve how we manage storm
flows during periods of heavy rainfall.
By installing 50 metres of much larger
diameter pipe, we have significantly
increased our stormwater storage
capacity, helping to prevent overflows
when the system is under pressure.
Additionally, we have installed new
sensors, to provide more accurate and
timely data so we can respond faster to
changes in flow. These enhancements
have improved our performance at
thissite.
Zero Spills Hub
Inspired by our Net Zero Hub, which
combines operational, engineering
andAI solutions to achieve ambitious
goals, we are excited to introduce our
Zero Spills Hub to support our Get
River Positive campaign. In the Arnold
catchment in Nottinghamshire, we
willbe trialling innovative solutions
incombination to deliver our WINEP
commitments and demonstrate how to
achieve zero spills in a catchment. Our
trials will focus on AI based solutions
that optimise the use of our existing
assets, as well as physical, biological
and nature-based solutions that
remove stormwater from the network
(and reuse it), apply localised
treatment and create smart storage
that can be used to flush the network.
Scan the QR code to view
the Severn Trent Storm
Overflow Map
Our Storm Overflow Map
25Severn Trent Plc Annual Report and Accounts 2025 |
Strategic Report | A Driver of Positive Change
Bathing rivers Protecting customer supply pipes Water resources
Ozone treatment at Ludlow Wastewater
Treatment Works
Supply pipe installation Witches Oak Water Treatment Works
Our goal
Improve the water quality of the River
Leamand River Teme by upgrading three
wastewater treatment works, treating and
reducing spills from storm overflows and
undertaking river water quality monitoring.
Achievements
We have successfully completed the project
and achieved our March 2025 target. The
installation of our wastewater treatment
works ozone disinfection upgrades is now
complete at all three sites. Our off-site
assembly approach proved to be time-
efficient, more cost-effective, and supportive
of equipment testing and commissioning.
Our planned improvements to 24 storm
overflows included the delivery of storage
tanks and surface water separation, which
have increased the length of river we have
improved to more than 120 km, delivering
benefits for customers, communities, and
theenvironment.
Throughout this project, we have
collaborated with the Rivers Trust to
betterunderstand how our customers and
communities use rivers and engaged with
local communities about our plans, which
has informed our collective approach to
taking care of rivers.
You can read more about our Get River
Positive campaign on pages 22 to 25.
Our goal
Replace up to 26,000 lead or leaking
customer-owned supply pipes in Coventry
and Bomere Heath, removing lead and
reducing leaks by around 1 million litres
aday from customer-owned pipes.
Achievements
We increased the rate of delivery, and have
successfully replaced over 17,000 supply
pipes, including almost 10,000 replacements
this year.
In Bomere Heath, we completed a full
sampling programme to identify any
remaining lead pipes. Moving forward, we
will work closely with the DWI to investigate
disengaging phosphate dosing in the area,
thereby reducing the carbon impact of our
water treatment processes.
Lead supply pipes are not solely a problem
for Severn Trent customers and we were
keen to share our experience with other
water companies. We held a Lead Industry
Day in October 2024, bringing together over
90 attendees from water companies, trade
bodies and regulators to talk about the
issues and our approach.
We estimate that we have reduced leakage by
0.22 m throughout this project. Additionally,
the programme generated significant
employment benefits in our region with over
3,400 jobs completed through the Grant
model in Coventry using local suppliers.
Our goal
Increase water supplies by treating up to
93 Ml/d using low-carbon-impact treatment
processes, and share our knowledge with
other water companies. In addition, our work
aimed to increase the biodiversity of up to
46ha of habitat at our Witches Oak wetland
next to the River Trent.
Achievements
The construction of our Raw Water
Abstraction and Transfer Project completed
in March 2025, despite exceptional weather
and flooding events. As part of this project,
we have successfully refurbished the
Witches Oak abstraction pumping station
toensure it operates at optimum capacity
and efficiency – building resilience for
customers and the environment. The
31floating wetlands biologically pre-treat
the raw water before we abstract it, reducing
the amount of traditional treatment required.
Our innovative ceramic membrane pilot plant
has been operational since December 2022
and is collecting critical data to support
real-time optimisation of the new treatment
works utilising this technology.
The brand new Witches Oak Water Treatment
Works began commissioning in December
2024, and we are increasing the volume
ofwater treated throughout the spring.
Wehaveinstalled new pipework to deploy
thetreated water from Witches Oak Water
Treatment Works into our network, ensuring
a sustainable water supply for the future.
120 km
river with improved water quality
17,176
supply pipe replacements delivered
93 Ml/d
new water treatment asset capacity
Green
Recovery
This year marks the successful completion of our ambitious Green
Recovery programme, for which Ofwat approved anadditional £566 million
(2017/18 prices) investment in 2021. We are proud of the benefits this
programme has delivered for our customers, communities and the
environment. Our Green Recovery initiatives have not only addressed
immediate challenges but have also laid the groundwork for a more
sustainable future for the sector more broadly. We remain committed to
continuing our efforts to protect and enhance the natural environment,
ensuring a resilient and thriving region for generations to come.
A Driver of Positive Change continued
26 | Severn Trent Plc Annual Report and Accounts 2025
Flood-resilient community Improving our region’s rivers Smart water meters
Detention basin, Mansfield River Ishbourne Smart water meter
Our goal
Create the UK’s first catchment-scale
flood-resilient community in Mansfield,
usingan innovative ‘nature-based’
approachto reduce surface flooding risk.
Achievements
We achieved this by installing Sustainable
urban Drainage Systems (‘SuDS’) across
Mansfield to absorb rainwater, providing
additional storage capacity and, crucially,
reducing surface water flooding for
customers and communities in this area.
Wedelivered more than 31,000 m³ of surface
water storage through our interventions,
constructing 84 rain gardens and
bioretention tree pits with a capacity of
almost 955 m³, and more than 11,300 m²
ofpermeable paving with an estimated
2,900 m³ of storage. Natural solutions, such
as bioswales and detention basins, have
delivered significant benefits – with our
143bioswales providing a storage capacity
ofover 14,700 m³ and our 12 detention
basinsproviding storage capacity of more
than 12,500 m³. Whilst primarily mitigating
against surface water flooding risks,
theseinterventions have also delivered
environmental benefits, such as increased
biodiversity and community amenity benefits.
We have learned a huge amount about the
actual costs of retro-fitting SuDS through
this project and how to roll them out at scale
in a more cost-effective way. This knowledge
will be used to help us, and others in the
sector and more broadly, to deploy SuDS
interventions moving forward.
Our goal
Support environmental improvements to
500km of rivers, accelerating our planned
WINEP investment by three years. This
includes delivering 47 Water Framework
Directive (‘WFD’) statutory obligations faster
by carrying out schemes to reduce storm
overflows and remove phosphorus.
We will also undertake Storm Overflow
Assessment Framework (‘SOAF’)
investigations to inform and prioritise
futureinvestment.
Achievements
We successfully delivered 21 WFD points
bythe end of March 2025 – 14 more than our
required seven. The remaining WFD points
are on track for delivery by the end of 2027.
Accelerating the delivery of our WFD
obligations delivers improvements to our
rivers more quickly. We have also been
installing more chemical dosing systems,
reedbeds and mechanical filters to reduce
the amount of phosphorus in the rivers
resulting from our wastewater operations.
In addition to the WFD points, the project
alsodelivered 54 overflow spill reduction
interventions (such as weir height increases)
and SOAF investigations to inform and
prioritise our future investment.
Our goal
Help customers save water – and also reduce
their bills – by installing over 157,000 smart
water meters to individual household
properties, aiming to promote water
efficiency and reduce consumption by
providing customers with real-time data
ontheir water usage.
Achievements
We have installed more than 157,000 smart
meters through the project, providing
blueprint for our smart meter installations
inAMP8, which has been shared with the
broader sector. The smart meters installed
across the Coventry area are enabling
customers to monitor their water usage and
identify leaks or internal plumbing issues
quickly. In addition, they have real-time
visibility of the positive impact they are
making – reduced water use means
lowerenergy consumption and lower
GHGemissions.
We now have a much-improved ability to
handle the increasing volume of data while
maintaining the integrity of our data systems.
Importantly, we can now leverage smart
datato drive meaningful insights in water
management. It is an ongoing process
whichwill maximise the benefits of smart
metering, leading to a more sustainable and
efficient water network.
The success of this project is reflected in our
leakage and PCC performance, which has
surpassed our expectations and has saved
7.2 Ml/d in 2024/25 and 12.4 Ml/d over AMP7.
31,156 m
3
surface water storage delivered
21
WFD points delivered
157,329
smart meters installed
Scan the QR code to visit the Severn Trent Water
Regulatory Library – our dedicated Green Recovery
Report will be available from 15 July 2025
27Severn Trent Plc Annual Report and Accounts 2025 |
Strategic Report | A Driver of Positive Change
In this section:
28 Environment
29 Our Approach to Climate Change
and Nature
30 Our Value Chain
32 Reporting Requirements
33 Double Materiality Assessment
34 Climate and Nature Governance
35 Climate and Nature
RiskManagement
40 Climate and Nature Strategies
42 Metrics and Targets
44 Our Triple Carbon Pledge and
Science-Based Targets
45 Our Net Zero Transition Plan
54 Report on Energy
55 Our EU Taxonomy Disclosure
RUNNING A BUSINESS THAT
GOES HANDINHAND WITH
NATURE
Environment
The natural environment is at the heart of our operations and
everyone in our business is focused on protecting and enhancing
nature, habitats and rivers across our region. We know that looking
after nature helps to look after water.
As part of our commitment to the environment, we created our Great
Big Nature Boost (‘GBNB’), an industry-leading initiative to enhance
biodiversity and make improvements to nature across our region.
In 2020, we set ambitious targets including boosting biodiversity
across 5,000 ha in our region by 2027. We were delighted to reach this
target four years early, in 2023, and we set ourselves anew ambitious
target of improving 10,000 ha by 2025 – still two years earlier than our
original target. We are thrilled that we surpassed this goal in2024
and have now delivered improvements to over 16,200 ha – more than
three times our original target. Our work to enhance and preserve our
natural environment accounts for more than 3% of the nation’s 2042
Nature Recovery Network target.
Our collaboration with nationally recognised and trusted partners
such as the National Trust, RSPB and the regional Wildlife Trusts has
been fundamental inachieving our ambitious plans. By leveraging
theexpertise and dedication of our partners, we have been able to go
further and fasterto deliver changes that protect and celebrate the
natural environment. In this final year of AMP7, we have worked with
20individual partners on 36 projects across our patch, which has
delivered nature improvements to over 3,100 ha across our region.
Examples during the year include our collaboration with the
ShropshireWildlife Trust and Shrewsbury Town Council supporting
thereintroduction of beavers to Shropshire after 400 years. Beavers
play acrucial role in creating natural habitats, enhancing water quality
and reducing flooding. By constructing dams, beavers help to filter
andpurify water, positively contributing to the health of our waterways.
Thisis the third reintroduction of beavers in our region that we have
supported, aided by learnings at Willington Wetlands in Derbyshire and
the Idle Valley Nature Reserve in Nottinghamshire in 2021. Since then,
both sets of beavers have established their habitats, created dams and
demonstrated why they are nature’s natural water engineers.
In 2019, we made a pledge to plant 1.3 million trees as part of our
GBNB and we have made good progress to deliver our target by 2027.
To date we have created 33 new woodlands, planted 72 tiny forests
andworked with our environmental partners and landowners to plant
a million trees. This includes creating a carbon neutral legacy for the
Birmingham 2022 Commonwealth Games as part of our commitment
to help create the most sustainable games to date.
Our Boost for Biodiversity grant fund – which offers small grants
forcommunity organisations and land owners to improve habitats –
isnow in its fifth and final year. The fund has supported 27 projects,
delivering over 130 ha of improvements across a range of projects,
including wildflower meadows, woodland management and
improvement, invasive species management and wetland restoration.
Other projects we have undertaken during the year include creating
flower-rich roadside verges in Shropshire and reinstating meadows
inWarwickshire to boost populations of wildflowers, fungi, bees,
butterflies and bats. Our longstanding partnership with Moors for
theFuture continues its vital work in the Peak District across the
Bamford Catchment and in Combs Moss, helping to restore the
degraded peatland through planting Sphagnum moss, a vital building
block for the restoration of blanket bog. This work is vital in helping
tocapture and store water, as well as protecting the peat from erosion
– this helps reduce overland flow during storms and protects drinking
water quality.
We are incredibly proud of the work we do to protect and enhance
nature and we have delivered a number of significant improvements
in our region over the last five years. We remain focused on this
asweenter AMP8, continuing to work hard for nature as well as
maintaining the work that we have completed with our partners.
Great Big Nature Boost 2027 targets:
– Enhance biodiversity across 5,000 ha
– Plant 1.3 million trees
– Restore 2,000 km of rivers across
ourregion
28 | Severn Trent Plc Annual Report and Accounts 2025
Our Approach to Climate
ChangeandNature
Set out on the following pages is our seventh disclosure under
therequirements of the Taskforce on Climate-related Financial
Disclosures (‘TCFD’), and voluntarily incorporates detail using
therecommendations of the Taskforce on Nature-related
FinancialDisclosures (‘TNFD’). Combined, these disclosures
providetransparent information on climate and nature risks and
opportunities relevant to our Group, demonstrating how interlinked
our governance, risk management processes and metrics are.
As a business that relies on the natural environment to deliver
ourservices, it is vital that we consider the impacts of a changing
climate to invest strategically in our own resilience. We are dedicated
to proactive climate action to reduce our impact and we foster
asustainability-led culture to protect the environment in all that we do.
Our key ambitions and investments to date
In March 2020, we committed to invest £1.2 billion in sustainability over five years, and to report on our progress in a transparent and
genuine way. The table below provides detail on where we have invested against our plans to 2025. Last year we exceeded our original
target, investing over £1.5 billion by March 2024, and we have now invested over £2.4 billion. More detail on our current metrics
andtargets is included on pages 42 to 43.
Our ambitions Our priorities
Climate-related
risks and
opportunities
Nature-
relatedrisks,
opportunities,
dependencies
and impacts
Our investment to
date (2020-2025)
Read more on
our progress
Carbon and
climate change
Triple Carbon Pledge
Science-Based Targets
Climate adaptation
£248m
Pages 44 to54
Enhancing
nature
Biodiversity
Pollution prevention
River water improvements
Catchment management
£1,073m
Pages 22 to27
Water
resources for
the future
Leakage reduction
PCC reduction
Meter installations
Strategic resource options
£889m
Pages 15 to16
Affordability
and
accessibility
Reducing water poverty
Building our Academy
Creating a Community Fund
Increasing conservation
£210m
Pages 19 to 21
We comply with all 11 TCFD recommendations, in accordance
with Listing Rule 6.6.6R, and have reviewedall14TNFD
recommendations. This means we consider the
‘Recommendations of the Taskforce on Climate-related
Financial Disclosures’ published in June 2017, the
supplementary guidance entitled ‘Implementing the
Recommendations of the TCFD’ published inOctober 2021
and‘Recommendations of the Taskforce on Nature-related
Financial Disclosures’ published in September 2023. We also
consider the wider guidance issued by the TNFD, and the work
of the International Sustainability Standards Board (‘ISSB’).
This disclosure complies with the requirements of the
Companies Act 2006 as amended by the Companies (Strategic
Report) (Climate-related Financial Disclosure) Regulations
2022 (‘CFD’).
Brancote Wastewater Treatment Works
29Severn Trent Plc Annual Report and Accounts 2025 |
Strategic Report | Our Approach to Climate Change and Nature
Severn
Trent
Severn
Trent
Severn Trent
Academy
Severn Trent
Academy
Severn
Trent
Severn
Trent
Invasive alien
species introduction/
removal
Land/freshwater/
ocean use change
Resource use/
replenishment
Land/freshwater/
ocean use change
6
Collaboration with partners
Overview: We have joined forces with over 200 partnership
projects in our region to fund projects ranging from small-space
tolandscape-scale interventions, such as grassland management
and creating or improving habitats.
Dependencies: Wider catchment habitats affect downstream
water quality so we actively manage them, even if not within our
ownership. Our stewardship extends to influencing the
management of third-party rural estates, which totals c.9,000 ha
across Severn Trent Water and Hafren Dyfrdwy.
Risks/Opportunities: To manage the increasing prevalence of
invasive non-native species, which can also improve bathing areas,
we may require development of further partnerships.
More extreme weather conditions may impact effective completion
of partnership projects.
1
2
6
7
5
9
1
Collect and clean raw water
fordistribution
Overview: We provide 2 billion litres of clean
water daily.
Dependencies: We rely on woodland,
peatlandand farmland ecosystems to provide
high-quality water for abstraction.
Impacts: Over-abstraction could damage the
health of our rivers and aquatic life.
Risks/Opportunities: Hotter, drier summers
reduce river and reservoir levels, restricting
water availability.
Principal Risk: We fail to provide a safe and
secure supply of drinking water to our customers.
Historical Financial Impact: In 2018, hot
weather events increased demand by over
300 million litres of water per day, impacting
our operating costs by £22 million.
Invasive alien
species introduction/
removal
Pollution/
pollution removal
Resource use/
replenishment
Climate change
To help navigate this disclosure, this diagram sets out our key
interactions with nature and the environment across our value chain,
and associated climate and nature risks and opportunities.
3
Collect and clean wastewater
Overview: We treat 3.35 billion litres of
wastewater each day before returning it safely
to the environment.
Impacts: Cleaning wastewater uses energy
and, in some processes, chemicals.
Risks/Opportunities: Wetter winters and
morefrequent storms mean higher volumes
ofwater in the network, which can result
inincreased flooding and use of storm overflows.
Insourcing our teams and creating a dedicated
Waste Network Control Centre increases the
control we have over our network, and investing
in nature-based solutions and SuDS increases
our flood resilience. Our processes produce
renewable energy and by-products like
biosolids and cellulose that can be sold.
Principal Risk: We do not transport and
treatwastewater effectively, impacting our ability
to return clean water to the environment.
Historical Financial Impact: Severe rainfall
increases the risk of flooding and pollution
events, which can result in fines for the Group.
Land/freshwater/
ocean use change
7
Provision of green spaces
Overview: Our public green spaces provide opportunities for
activities like angling, sailing and cycling.
Dependencies: Operating reservoirs, farmland, moorland and
woodland relies on clean air and water.
Impacts: Deterioration could damage our reputation and
customerexperiences.
Risks/Opportunities: Hotter, drier summers and drought could
cause deterioration.
Between 2025 and 2030, we are investing £1.1 billion in
improvements to transform our network and protect our rivers.
Principal Risk: Failure to act as a steward of natural capital in our
region providing social, environmental and economic benefits.
2
Distribute clean water
Overview: We supply 4.7 million customers
with drinking water.
Impacts: Energy is needed to maintain water
pressure and distribute it to customers,
which has an emissions impact.
Water leakage impacts availability. We have
met our leakage reductiontargets for the last
five years and we are proud to have reduced
leakage by 16.8% across AMP7.
Risks/Opportunities: Strong customer
engagement helps to manage demand,
particularly over summer.
We are targeting net zero operational
emissions by 2030.
Climate change
Our Value Chain is complex and has multiple touchpoints with the environment
30 | Severn Trent Plc Annual Report and Accounts 2025
Severn
Trent
Severn
Trent
Severn Trent
Academy
Severn Trent
Academy
Severn
Trent
Severn
Trent
Climate change
Land/freshwater/
ocean use change
Land/freshwater/
ocean use change
Climate Change Adaptation
This year we have increased focus on
understanding our climate risks and building
stronger adaptation plans. Read more about
our Climate Change Adaptation Report on
pages 40 and 41.
Nature indicators of
risk and opportunity
Climate change
Incorporating climate change into
strategies and reducing emissions
Land/freshwater/
ocean use change
Limiting urbanisation and
preventing habitat loss
Resource use/
replenishment
Avoiding over-extraction of
natural resources or disrupting
ecosystems
Pollution/
pollution removal
Restricting release of harmful
substances
Invasive alien
species introduction/
removal
Protecting against invasive
species disrupting ecosystems
8
Renewable energy production
Overview: We generate energy from anaerobic
digestion of sewage sludge, food and crops, as
well as through wind, solar and hydro resources.
Dependencies: To generate renewable energy
using wind, solar and hydro resources, we rely
on the availability of these resources. Our energy
strategy ensures that we generate energy from
arange of resources to balance this dependency.
Impacts: Alongside increased generation, our
Energy Management Policy seeks to improve
the efficiency of energy use and the assets
weown to reduce our energy consumption.
Risks/Opportunities: This year, we announced
that we are expanding our solar renewable
generation with the construction of four solar
farms which will add an additional 185 GWh/
year to our portfolio.
3
8
4
4
Recycle water to the environment
Overview: We discharge thousands of litres
of treated water into rivers every day.
Impacts: Final effluent must be clean and have
no adverse effect on river quality. We must
comply with our environmental permits.
Risks/Opportunities: Final effluent can
restore flow to low rivers, whilst too much
flow can cause flooding. Effective dilution
levels positively contribute to water quality
inthe environment and reduce RNAGS. Some
streams and brooks rely on our works flows
to remain drought resilient.
Principal Risk: Failure to act as a steward of
natural capital in our region providing social,
environmental and economic benefits.
Invasive alien
species introduction/
removal
Pollution/
pollution removal
Resource use/
replenishment
Climate change
5
Recycle biosolids to farmland
Overview: Our anaerobic digestion facilities
turn sewage and crop into renewable energy
and biosolids.
Impacts: Farmers spread treated biosolids
onto farmland, which enhances soil health
and supplies nutrients. Every year, we recycle
c.600,000 tonnes of biosolids to approximately
30,000 ha of land across the UK.
Risks/Opportunities: There may be adverse
impacts of soil compaction from machinery,
and chemical and nutrient run-off from
farmsleading to eutrophication and/or
waterpollution. Flooding to farmland and
changes in farming practices may cause the
sludge to land route to become unviable.
Bioenergy generation makes use of otherwise
waste materials.
Invasive alien
species introduction/
removal
Pollution/
pollution removal
Resource use/
replenishment
9
Construction projects
Overview: Construction and civil engineering
work is needed to keep our water and
wastewater networks running and drive
performance improvements for customers
and the environment.
Impacts: Our work on Biodiversity Net Gain
(‘BNG’) and our own net gain policy support
our aims to counteract activities that may
cause physical disruption to habitats, or
destruction of habitats when they are
converted to other land uses.
Risks/Opportunities: Unfavourable weather
conditions could cause delays in our
capitalprogrammes.
31Severn Trent Plc Annual Report and Accounts 2025 |
Strategic Report | Our Approach to Climate Change and Nature
Requirement/Recommendation Read more
Governance
CFD
a) Describe the company’s governance arrangements in relation to assessing and managing climate-related
risks and opportunities.
Governance Framework
pages104 to 105
TCFD & TNFD
a) Describe the Board’s oversight of climate-related risks and opportunities.
a) Describe the Board’s oversight of nature-related dependencies, impacts, risks and opportunities.
b) Describe management’s role in assessing and managing climate-related risks and opportunities.
b) Describe management’s role in assessing and managing nature-related dependencies, impacts, risks
andopportunities.
Board Skills page 102
Board Activities pages 106 to 107
Board Performance Review
pages112 to 113
Our Climate and Nature
Governance page 34
c) Describe the organisation’s human rights policies and engagement activities, and oversight by the Board
andmanagement, with respect to Indigenous peoples, local communities, affected and other stakeholders,
inthe organisation’s assessment of, and response to, nature-related dependencies, impacts, risks
andopportunities.
Section 172 Statement pages 91
to93
Severn Trent sustainability
webpages
Risk management
CFD
b) Describe how the business identifies, assesses and manages climate-related risks and opportunities.
c) Describe how processes for identifying, assessing and managing climate-related risks are integrated into
thebusiness’ overall risk management process.
Managing Risks and
Opportunities pages 68 to 69
Our Principal Risks pages 73 to 78
Climate and Nature Risk
Management pages 35 to 39
Double Materiality Assessment
page 33
Our Value Chain pages 30 to 31
Our EU Taxonomy Disclosure
pages 55 to 59
TCFD & TNFD
d) Describe the organisation’s processes for identifying and assessing climate-related risks.
e) Describe the organisation’s processes for identifying, assessing and prioritising nature-related
dependencies, impacts, risks and opportunities in its upstream and downstream value chain(s).
f) Describe the organisation’s processes for managing climate-related risks.
g) Describe the organisation’s processes for managing nature-related dependencies impacts, risks
andopportunities.
h) Describe how processes for identifying, assessing and managing climate-related risks are integrated into
theorganisation’s overall risk management.
i) Describe how processes for identifying, assessing, prioritising and monitoring nature-related risks are
integrated into and inform the organisation’s overall risk management processes.
Strategy
CFD
d) Describe the principal climate-related risks and opportunities arising in connection with the company’s
operations, and the time periods by reference to which risks and opportunities are assessed.
e) Describe the actual and potential impacts of the principal climate-related risks and opportunities on the
company’s business model and strategy.
f) Analyse the resilience of the company’s business model and strategy, taking into consideration different
climate-related scenarios.
Our Principal Risks pages 73 to 78
Our Value Chain pages 30 to 31
Climate and Nature Risk
Management pages 35 to 39
Climate and Nature Strategies
pages 40 to 41
Our Net Zero Transition Plan
pages 44 to 54
TCFD & TNFD
a) Describe the climate-related risks and opportunities the organisation has identified over the short, medium
and long term.
a) Describe the nature-related dependencies, impacts, risks and opportunities the organisation has identified
over the short, medium and long term.
b) Describe the impact of climate-related risks and opportunities on the organisation’s businesses, strategy
andfinancial planning.
b) Describe the effect nature-related dependencies, impacts, risks and opportunities have had on the
organisation’s business model, value chain, strategy and financial planning, as well as any transition plans
oranalysis in place.
c) Describe the resilience of the organisation’s strategy, considering different climate-related scenarios,
including a 2°C or lower scenario.
c) Describe the resilience of the organisation’s strategy to nature-related risks and opportunities taking into
consideration different scenarios.
Climate and Nature Strategies
pages 40 to 41
Our Net Zero Transition Plan
pages 44 to 54
Climate and Nature Risk
Management page 35 to 39
d) Disclose the locations of assets and/or activities in the organisation’s direct operations and, where possible,
upstream and downstream value chain(s) that meet the criteria for priority locations.
Metrics and targets
CFD
g) Describe the targets used by the company to manage climate-related risks and to realise climate-related
opportunities, and performance against those targets.
h) Describe the key performance indicators used to assess progress against targets used to manage climate-
related risks and realise climate-related opportunities, and the calculations on which those key performance
indicators are based.
Our Net Zero Transition Plan
pages 44 to 54
Metrics and Targets pages 42 to 43
TCFD & TNFD
a) Disclose the metrics used by the organisation to assess climate-related risks and opportunities in line with
its strategy and risk management process.
a) Disclose the metrics used by the organisation to assess nature-related risks and opportunities in line with its
strategy and risk management process.
b) Disclose Scope 1, Scope 2 and, if appropriate, Scope 3 greenhouse gas (‘GHG’) emissions and the related risks.
b) Disclose the metrics used by the organisation to assess and manage the dependencies and impacts on nature.
Our Net Zero Transition Plan
pages44 to 54
GHG emissions table pages 52
to53
Reporting Requirements
The table below sets out the requirements and recommendations of the CFD, TCFD and TNFD frameworks and references the location
ofrelevant information. We continue to develop our TNFD disclosure and this will expand against the recommendations in future.
Running a Business that Goes Hand-in-Hand with Nature continued
32 | Severn Trent Plc Annual Report and Accounts 2025
Double Materiality Assessment
Whilst Severn Trent is not captured by or voluntarily adopting the
Corporate Sustainability Reporting Directive (‘CSRD’), this year
wecompleted a double materiality assessment using the same
principles. This assessment helps to ensure we report on the most
material issues to our key stakeholders. A sustainability issue has
double materiality if it has the potential to affect our business
financially (financial materiality) and has the potential to impact
peopleor the planet (impact materiality). Financial materiality is
based on our Enterprise Risk Management (‘ERM’) system.
Impactmateriality is based on stakeholder views. An issue only
needsto have either impact orfinancial materiality to drive us to
invest and manage the associated risks. For example, protecting
vulnerable customers ismaterial to our communities, and we
invested £88 million this year to support them, but this is not
amaterial risk inour ERM system.
We identified 12 topics which are material to our business. These are
summarised below against the pillars of our corporate strategy
andwhere to read more information. A comparison to the European
Sustainability Reporting Standards (‘ESRSs’) set out in CSRD
andtheUN Sustainability Development Goals (‘SDGs’) is also
includedbelow.
Material topic
Material
(impact)
Material
(financial) ESRSs SDGs Read more
Delivering Outcomes our Customers Care About
Ensure a sustainable water supply and effective demand
management resilient to climate change and population growth.
E3, E5, S3 Responsible consumption
and production
Pages 15 to 16
Improve and maintain asset health and resilience
throughinvestment.
E3 Industry, innovation
andinfrastructure
Pages 15 to 16
Ensure access to quality water for all customers, at all times.
E3, E5, S3 Clean water and
sanitation
Page 16
Have plans in place to manage and respond to extreme
weatherevents, including floods and droughts.
E3, E5, S3 Life on land
Pages 16 to 18
Provide support to vulnerable customers and
communitymembers.
S3, S4 No poverty
Page 15
Running a Business that Goes Hand-in-Hand with Nature
Play our part to mitigate climate change through GHG
emissions reductions.
E1 Climate action
Pages 44 to 54
Have a net-positive impact on the environment.
E4 Life on land
Page 28
Caring for People in our Region
Ensure employees have a fair, inclusive and safe workplace.
S1, S2 Decent work and
economic growth
Pages 19 to 21
Develop a skilled future workforce through training
andattraction.
S1 Decent work and
economic growth
Pages 19 to 21
A Driver of Positive Change
Play an active role to enhance river water quality.
E2, E3 Life on land
Pages 22 to 27
Operate as an ethical business, while meeting legal and
regulatory compliance.
G1, S1, S2, S4 N/A
Page 103
Ensure the highest levels of corporate governance over
sustainability-related matters.
G1 N/A
Page 104
We used our previous assessment from 2021/22 and updated it,
reviewing over 100 sustainability topics for consideration.
Assessing impact materiality
Our impact assessment involved considering the views and
preferences of our stakeholders, including customers, investors,
suppliers and employees and using existing internal knowledge.
Eachstakeholder group was represented by an internal subject
matter expert who was asked to rank topics on scale, scope and
opportunity. This information was then consolidated and weighted
tocreate a final ranking.
Assessing financial materiality
Financial materiality is already incorporated within our ERM system
and we have used our existing financial materiality threshold of
£10 million to identify the sustainability-related topics for review.
Double materiality assessment
The final list of 12 material topics was determined through a process
ofrobust challenge and evaluation from subject matter experts
andsenior leaders across the business, with oversight by the
Corporate Sustainability Committee. Our existing reporting approach
already aligns in many areas, and we will continue to challenge
ourselves toensure we report on the topics of material value to
ourkeystakeholders.
Graduates at Finham Wastewater Treatment Works
33Severn Trent Plc Annual Report and Accounts 2025 |
Strategic Report | Our Approach to Climate Change and Nature
Climate and Nature Governance
Robust governance underpins everything we do. The associated
risks, opportunities and organisational implications related to climate
change and nature are overseen by the Severn Trent Plc and Severn
Trent Water Limited Boards, and the respective Board Committees,
Executive Committee, Senior Management Team and Group
subsidiary company boards.
Board oversight
The Board has oversight of both climate and nature risks and
opportunities through reviewing our EU Taxonomy profile, TCFD and
TNFD reporting and NZTP. The Board receives management reports
on Environmental, Social and Governance (‘ESG’) matters at meetings
throughout the year. Senior leaders within the Group and external
guest speakers attend Board and Corporate Sustainability Committee
meetings on a regular basis to offer independent expertise and insight
to promote challenge and debate.
As well as oversight for ESG responsibilities, the Board approves
ESGstrategies and investment decisions relating to climate change
and nature. Sustainability matters are included as a standing agenda
item at every Board meeting along with a detailed report provided
bythe Corporate Sustainability Committee. The Board holds dedicated
sessions to consider, identify and assess climate and nature risks
andopportunities, monitoring of progress against goals and targets
andsustainability-related topics. The Boarddelegates certain
sustainability, climate and nature-related risk oversight activity to
theCorporate Sustainability Committee as well as to the Audit and
Risk Committee. The Board’s cross-membership of Committees
assists with its oversight.
The Corporate Sustainability Committee met four times throughout
the year to discuss climate and ESG-related matters. Read more
onpage 130.
Our Governance Framework
Our Governance Framework is aligned with the Group’s corporate
strategy, ensuring the Board is effective in its oversight of the Group’s
objective to be sustainability led in consideration of climate and
nature risks and opportunities, and scrutiny of management’s
assessment of these risks and opportunities.
The Chief Executive, Executive Committee and Senior Management
Team have day-to-day responsibility for climate-related and nature-
related matters. This includes the management of identified risks and
opportunities through established procedures, and using this insight
to develop the Group’s strategy and support our environmental and
sustainability objectives. Our Governance Framework is set out on
page 104 and is subject to periodic review to ensure it remains
effective and appropriate.
Board climate and nature expertise and evaluation
A key strength of our Board is the collective experience
of the Directors and diverse skills they possess, as set out in our
Board skills matrix on page 102. Our succession planning considers
the composition of the Board, with an emphasis on sustainability and
climate-related topics to ensure that we continue to build upon the
strong progress we have made in our sustainability ambitions to date.
Our code of conduct, Doing the Right Thing, alongside our Anti-
Slavery and Human Trafficking Statement and supporting Group
policies, are reviewed regularly and signed off by the Board.
Thecombined policies ensure that we hold ourselves accountable,
respecting the rights of our workforce, the people in our supply chain,
and those impacted by our operations. We actively avoid human rights
infringements and address any impacts when they do occur. We
expect our supply chain partners to protect the rights of Indigenous
people (where relevant) and local communities.
Remuneration
Our transparent remuneration framework incorporates climate and
nature objectives. It aligns reward and incentive structures throughout
our business from our frontline operatives through to our Executive
Committee. These incentives are reviewed and agreed by the Group’s
Remuneration Committee. ESG measures already form part of the
Annual Bonus Scheme metrics, details of which are set out in the
Directors’ Remuneration Report on page 139.
In 2024, we changed our Long-Term Incentive Plan (‘LTIP’) to increase
the weighting of non-financial measures from 20% to 50%, and
included three new LTIP measures: a long-term river health
measure; a customer measure; and a communities measure.
Board members on site at Hayden Wastewater Treatment Works, April 2025
Running a Business that Goes Hand-in-Hand with Nature continued
34 | Severn Trent Plc Annual Report and Accounts 2025
Climate and Nature Risk Management
Managing climate change and nature risks
Our approach to managing our Group climate and nature risks over different time horizons is outlined in the table below, where each time
horizon is determined by reference to our planning cycles for Ofwat and other regulators. These planning cycles determine how we review and
assess risk, creating short-term, medium-term and long-term investment plans to manage and mitigate these risks. The risks themselves are
exacerbated by climate change and nature over different time horizons, according to modelled likelihoods. These are set out in the table on the
page opposite.
Time horizons 0-2 years (short-term) 3-5 years (medium-term) 6-25 years (long-term)
Our approach We implement tactical response
plansto ensure delivery of our
annualperformance targets.
Our Business Plan describes the
improvements that we will commit to
delivering in the next AMP cycle and
lessonsfor our short-term delivery.
Long-term plans explore and
account for future potential risks
we may face, including climate
change uncertainty and the steps
that could be taken.
Critical documents – Risk and opportunities
management framework
– Incident management plans
– Root cause analysis outputs
– Drought Plan
– Localised response strategies
– Risk and opportunities
managementframework
– Regulator-approved AMP investment plan
– Rolling internal five-year Business Plan
– Climate Change Adaptation Report
– Risk and opportunities
management framework
– Water Resources Management
Plan (‘WRMP’)
– Drainage and Wastewater
Management Plan (‘DWMP’)
– Strategic Direction Statement
(‘SDS’)
– Long-Term Delivery Strategy
(‘LTDS’)
Climate change and nature dependencies are embedded in day-to-day
management and strategic decision making.
We embed a risk-based approach to managing climate change and
nature throughout our business using our existing processes, as set
out in the Managing Risks and Opportunities section on pages 68 to
69. Nature is embedded in our decision making and this is now explicit
in our risk processes through the incorporation of nature drivers
(alongside the existing climate drivers) in our ERM system. A training
session for Risk Co-ordinators was held this year to upskill the
business on understanding both climate and nature impacts on
riskand to embed the updated processes.
Our existing risks are scored within our ERM system using likelihood
and impact measures to quantify the risk. In doing so, we consider
both financial and reputational impact to arrive at areasonable
estimate of value, and our approach to calculating likelihood considers
external scenarios and a changing climate.
Our levels of materiality remain the same as reported previously,
where anything above a £10 million threshold is reported in our ERM
system. Four further levels exist up to £75 million, at which value the
associated risks are reported at Board level.
Nature drivers across our business
The charts below show the number of ERM risks exacerbated by nature drivers within each of our business areas, to demonstrate the
types of nature issue relevant to our core operations.
All ERM-level risks are reviewed annually, using this insight, by our dedicated network
ofRiskOwners and Co-ordinators, supported by the central ERM Team. This ensures
ongoing engagement with climate and nature impacts and that appropriate risk mitigation
strategies are in place. Wecontinue to develop the functionality in our ERM system to
reflect our increasing understanding of climate and nature-related risks and the maturity
of our mitigation plans.
Bioresources
4
1
2
3
1
0
2
4
6
8
10
12
14
16
18
Waste
7
1 11
1 1
3
0
2
4
6
8
10
12
14
16
18
Water
17
6
1
10
2
0
2
4
6
8
10
12
14
16
18
Climate change Freshwater use/
change
Land use change
Invasive
species
Pollutions
Resource use/
replenishment
Atmosphere change
Bioresources
4
1
2
1
3
35Severn Trent Plc Annual Report and Accounts 2025 |
Strategic Report | Our Approach to Climate Change and Nature
Risk type Principal Risk Drivers
Example risks incorporated into
the wider risk environment
Time horizon Range of
financial risk
(current year)2030 2050 2080
Physical Risks
Safe and
secure supply
of drinking
water
We do not supply
asafe and secure
supply of drinking
water to our
customers.
Hotter, drier summers
Warmer, wetter
winters
Change in
freshwateruse
Pollutions
Failure to provide water treatment
capacity to meet requirements in
future AMPs.
Failure to ensure our network is
resilient to meet supply requirement
in future AMPs.
Failure to address increased demand
for water due to population growth
and changing weather conditions.
£30 million to
£144 million
Transport and
treatment of
wastewater
We do not transport
and treat wastewater
effectively, impacting
our ability to return
clean water to the
environment.
Hotter, drier summers
Warmer, wetter
winters
Extreme weather
Land use change
Pollutions
Failure to safeguard future
wastewater treatment capacity to
meet future demand or increased
environmental obligations.
Failure to ensure waste capacity
network is resilient to meet
futuredemand.
£28 million to
£66 million
Natural capital Failure to act as
asteward of natural
capital in our region
providing social,
environmental and
economic benefits.
Hotter, drier summers
Warmer, wetter
winters
Extreme weather
Invasive species
Resource use/
replenishment
Failure to deliver our accelerated
Green Recovery programme to time,
cost or quality.
Failure to abstract sufficient raw
material for our customers or
over-abstract, damaging the
naturalenvironment.
£1 million to
£23 million
Transition Risks
Regulation/
policy
Uncertainty of
regulatory, legislative
and government
reforms could
fundamentally
impactour operating
environment and
strategic ambitions.
Hotter, drier summers
Warmer, wetter
winters
Extreme weather
Policy or legal change
Failure to successfully deliver the
benefits of our change programme.
The investment required will impact
customer bills and affect
affordability for some.
Failure to comply with CSO permits
or stakeholder expectations.
Failure to build trust in Severn Trent
with our key stakeholders.
£2 million to
£6 million
Climate
change
strategy
Our climatechange
strategy does not
enable us to respond
to the shifting natural
climatic environment
and maintain our
essential services.
Hotter, drier summers
Warmer, wetter
winters
Extreme weather
Failure to build trust in Severn Trent
with our key stakeholders.
£200,000 to
£7 million
People and
culture
Our people and
culturedo not adapt in
response to a changing
environment and do
not take advantage
oftechnological
advancements to
deliver enhanced
business performance.
Technology change Failure to develop our people with
the appropriate skills, knowledge
and behaviours to enable them to
fulfil their role effectively.
Failure to attract and retain the
right people.
£2 million to
£6 million
Period of opportunity or risk Most material impact
Linking climate and nature drivers to our risks to understand financial impact
We recognise the importance of understanding the financial risks of
climate change to support our investment decisions, and continue to
expand our reporting to demonstrate this. This year, we are able to
report the financial impact and materiality of climate-related risks
and opportunities.
Following the incorporation of climate drivers within our risk
management system in 2023/24, we now model the financial value
ofrisks exacerbated by these drivers. In future we will expand on
thiswork to report financial values for nature drivers.
Within our 11 Principal Risks, which are critical to the delivery of
ourstrategy, six are most impacted by climate or nature as set out in
the table below. The range of financial risk values are taken from the
ERM system for each risk exacerbated by a climate driver. These are
based on the current value of the risk, with documented controls and
mitigations in place, multiplied by the likelihood relevant to the time
horizon for that risk. For example, for a 1 in 50-year likelihood, the
financial impact value is multiplied by 2%. We will enhance our
approach in future to incorporate a range of temperature scenarios
andtime horizons against each risk in the system.
Running a Business that Goes Hand-in-Hand with Nature continued
36 | Severn Trent Plc Annual Report and Accounts 2025
0Number 5 10 15 20 25 30 35 40
Atmosphere change
Resource use/replenishment
Pollutions
Invasive species
Land use change
Freshwater use/change
Climate change
Bioresources Waste Water Group-wide
Number of risks linked to nature
The chart below shows the number of ERM risks exacerbated by nature drivers across different areas of our Group, to demonstrate
thescale of impact relevant to each nature issue. As our processes mature, we will report financial values for nature drivers in future.
River Leam
Current value of risks exacerbated by climate drivers
We report here the financial value of risks exacerbated by each climate driver. Unsurprisingly, weather drivers have the highest value to
ourbusiness, with the largest being hotter, drier summers, exacerbating risks with values of over £200 million. Ourmodelling of strategic
options and continuous drive to invest in the opportunities presented to us by climate change (set out on the next two pages) help to balance
the impacts of extreme weather andbuild resilience in our business. Our climate risks are already reflected in our AMP8 Business Plan and
the impact of weather is built into our strategies and investment decisions to enable proactive mitigations throughout every planning cycle.
0 2 31 4 65 7
Technology
change
Policy
or legal
change
Transition risk drivers
£m 0£m 50 100 150 200
250
Extreme
weather
Warmer,
wetter
winters
Hot ter,
drier
summers
Physical risk drivers
37Severn Trent Plc Annual Report and Accounts 2025 |
Strategic Report | Our Approach to Climate Change and Nature
Keeping future optionsopen
There are many factors that can lead to future uncertainty, of which
climate change is a significant element. Consequently, in addition to
our core pathway on which our AMP8 investment plan is based, we
have three adaptive pathways that allow us to change our approach
as external factors change. These are:
– Climate triggered change
– Societal shifts
– Government-led change through legislation
The pathways use a range of assumptions including climate
change,population growth and technology (read more in our LTDS),
whichinturn were based on over a thousand ‘what if’ simulations.
These simulations allow usto understand how the optimal
investment choices differ under arange of assumptions and
identifythe most material issues, e.g.changes to the efficacy
ofsolutions. This process helps us cater for a broad set of
futuresand reflects the uncertainty associated with planning
overseveral decades.
The diagram above demonstrates how we pivot our approach
depending on key triggers and decisionpoints.
For example, the impacts of climate change felt locally might
triggerincreased concern for the environment and therefore
greater investment needed to mitigate potential impacts, but
couldalso stimulate a market and customer response to help
solvethese issues.
These adaptive pathways are all plausible, but it is not possible
tocalculate the likelihood of any particular route or future.
Ourinvestment programme takes into account all three adaptive
pathways and ‘no-regrets’ investments, as well as areas to
prioritise to keep future options open.
Our optimisation analysis for AMP8 resulted in one change to our
core pathway. Inour original core pathway optimisation, we selected
two water resource schemes to resolve the current AMP8 supply
deficit. However, in allthree of the adaptive pathways, that solution
had potential to fail in more adverse circumstances. We reviewed
awide range of options and found that the lowest-cost solution
would be to construct a larger solutionin the short term, i.e.to
increase reservoir capacity and avoid potential future cost.
To help understand when it may be appropriate to transition
toanalternative pathway, we have identified triggers which will
drivedifferent investment choices relevant to the new scenario,
forexample if the Representative Concentration Pathway (‘RCP’)
ison course for 2°C or higher.
Climate triggered change
Societal shifts
Government-led legislation change
Core pathway
Decision point
Trigger point
0
5
10
15
20
2025 2030 2035 2040 2045 2050AMP8 AMP9 AMP10 AMP11 AMP12
Total AMP totex (£bn)
2035
Customer-driven
environmental investments
2027
UK Climate
Projections published
2044
Census data released
2035
Innovative technologies
come to market
2033
National Infrastructure
Assessment recommends
accelerated flooding
investment
Trigger: Accelerated
Environmental Act
Change: Pivot to high
environment scenario
Government-led change
Climate triggered change
Societal shifts
Trigger: Wider policy updates
Change: Accelerated
environmental investment
Trigger: Customers expect faster
progress on long-term targets
Change: Pivot to customer-led
environmental investments
Trigger: Market and supply chain
respond with innovation
Change: Pivot to benign technology
Trigger: Market and supply chain
respond with innovation
Change: Pivot to benign
technology
Trigger: Climate change triggers
inland migration
Change: Pivot to adverse growth
Trigger: Customers value
wider benefits
Change: Pivot to nature-based
solutions over traditional methods
Trigger: Market responds with
mechanisms to reduce pressure
on customer bills
Trigger: Customer behaviour
changes to avoid climate change
Change: Pivot to benign demand
Trigger: Climate change worsens
Change: Pivot to adverse
environment scenario
Trigger: Exceeding PCC targets
Change: Pivot to benign
demand scenario
Trigger: Innovation meets
public sentiment
Change: Pivot to benign
technology scenario
Running a Business that Goes Hand-in-Hand with Nature continued
38 | Severn Trent Plc Annual Report and Accounts 2025
M
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A
I
N
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Opportunities presented to us by a changing climate
Through effective risk management and decision making, climate change presents investment opportunities to deliver growthincapital
value for our investors and secure a quality service for our customers. Between 2025 and 2030, we will invest inwater resources and
help protect the region from drought, including £576 million in resilience schemes and £281 million to managedemand. Examples of
these opportunities are set out below.
Maintaining asset health and resilience
Our investments in climate mitigation activities through our
Strongford Net Zero Hub, and the funding granted in AMP8 to
reduce our operational emissions, are a huge part of ensuring
wemitigate climate change. Our AMP8 investment will ensure
wedeliver operational assets that are future ready with less
emissions impact, and will represent capital growth of
over£295 million.
As well as new operational assets, we will be proactively
maintaining and improving our water network to reduce
theneedfor reactive repairs. We will invest
£341 million to increase theresilience of
our assets. This will protect our sites
against the impact of severe
weather, such as power failures
or extreme flooding.
Improving service for
ourcustomers
The investments we make to
tackle climate change must
also be affordable and give
customers confidence in ourservice.
Sewer flooding is one of the worst
impacts our customers can experience.
We will work hard to reduce both internal
and external sewer flooding significantly
this AMP.
Our customers want to see us reduce
spills from overflows and protect our
rivers. We will invest £1.7 billion
in563schemes in AMP8 and have
committed toa major 25-year
investmentof £4.4 billion up to 2050.
Our2,472 storm overflows will each
haveindividual action plans with
avarietyof improvements ranging from
increasing the capacity of storage tanks
tointroducing nature-based solutions.
Improving the environment –
renewableenergy investment
Our Green Power business owns a diverse
portfolio of renewable energy production
facilities including 30 solar parks, six
windturbines and eight hydro-electric
turbines. Climate change presents us
withgreater investment opportunities for
renewableenergy.
To get us closer to our ambition to power the
UK towards a cleaner and more sustainable
future, we will be constructing four new
large-scale solar farms in four counties:
Leicestershire, Warwickshire, North
Yorkshire and Shropshire.
Improving the environment
– nature-based solutions
We are investing in more
SuDS, which are nature-based
solutions that deliver multiple
environmental, social and economic
outcomes including:
– flood prevention through managing
surface water run-off;
– improved water quality through
sediment and pollutant filters;
– water savings through rainwater
collection for non-potable use;
– biodiversity improvements providing
essential habitats for a variety of plants
and animals;
– improved aesthetics by filling urban
spaces with green infrastructure; and
– better community engagement
encouraging local communities to
playtheir role in protecting the
localenvironment.
Protecting our water supply
Climate change and population growth are putting increasing
pressure on the UK’s water resources. Our strategic resource
options (‘SROs’) allow us to work across the sector to benefit
other areas, whilst securing water resources for the future.
Ourbiggest SROs include:
– creating a £150 million pipeline between Carsington
andTittesworth Reservoirs;
– investing £30 million to prepare a quarry for increased water
storage in theWest Midlands;
– using the Grand Union Canal for water
abstraction and treatment at a cost of
£19 million;
– £14 million feasibility
assessment for
Nottinghamshire mine water
treatment facility;
– investing £25 million
inadditional raw water
sources to increase
sustainable output
through Tittesworth
Reservoir in periods
ofdrought; and
– £3 million investment in
aRiver Severn to River
Thames drought
interconnector.
39Severn Trent Plc Annual Report and Accounts 2025 |
Strategic Report | Our Approach to Climate Change and Nature
Climate and Nature Strategies
As a water and wastewater business, we are deeply interconnected
with the environment around us and take our impacts and
dependencies on nature and the climate very seriously. Protection
ofthe environment we depend on is fundamental to our business.
There are three key pillars to our environmental strategies:
– Climate change mitigation and our net zero ambitions
– Working hand-in-hand with nature and caring for ourenvironment
– Investing for resilience and adapting to climate change
Climate change mitigation
We are proud to build on our strong foundation of reducing
operational GHG emissions with a new ambition to meet net zero
across all three scopes by 2050 and a target to reduce our methane
emissions by 30% by 2033. This is in line with a 1.5°C trajectory,
keymilestones for which are set out in our NZTP on pages 44 to 54.
Our priorities
Over the next five years, we will reduce the most material emissions
unique to our sector, nitrous oxide and methane, which are released
through the biological treatment of sewage and biosolids.
Our detailed NZTP aligns to the Paris Agreement and outlines the
expected glidepath to meet our near-term reduction targets using
thesignificant funding we have secured from Ofwat. We were
awarded 59% of the £295 million total net zero funding across
thesector.
External collaboration
Collaboration is an essential cornerstone of our strategy. Working
closely with others in the sector and sharing lessons learned from
ourNet Zero Hub globally continues to be very productive.
We co-chair the Water Carbon Network, facilitating joint initiatives
toimprove our GHG data, build consistency across our supply chain
and knowledge-share on construction techniques.
Future focus
The next five years represent a big opportunity as we invest at an
unprecedented scale to ensure the quality, safety and continuous
supply of water and wastewater services to our customers and
protect theenvironment. This growth and investment means our
emissions will rise, particularly Scope 3 emissions. However, we still
expect tooutperform our Science-Based Target of 46% reduction by
2031 (see our progress on page 44) and recognise the importance
ofreflecting Scope 3 emissions in future targets. We have strong
engagement across our supply chain and are working with them to
consider arange of technologies. As we look to future AMPs, we will
continue to consider the balance between delivering our business
objectives, reducing GHG emissions and maintaining affordability
forcustomers.
Our nature strategy
Running a business that goes hand-in-hand with nature is a core
pillar of our corporate strategy. This considers both our impact and
dependencies on nature, and whilst we are proud of what we have
already achieved, we know there is always more we can do. Our
approach is described in our Caring for our Environment Strategy
document (published in 2021) and rests on four fundamental pillars
toaddress the global challenges of climate and nature and meet the
demands we face as a business:
– Ensuring a sustainable water cycle
– Enhancing our natural environment
– Making the most of our resources
– Mitigating climate change
Snow at Tissington Distribution Service Reservoir
Investing for climate resilience
Our AMP8 Business Plan secured £576 million of funding to increase
our resilience to climate change, population growth and increasing
urbanisation. We recognise the challenges of a changing climate
andincreasingly extreme weather conditions as they already impact
our operations. We have to invest now to mitigate the adaptation risk
in future. For example, according to the Government’s WINEP, by 2050
some rivers could have up to 80% less water in summer making it
impossible to meet the growing water demands of people, industry
and agriculture. The key documents set out on the page opposite
incorporate the scenario modelling we use to establish our
investment plans against the backdrop of these risks, driving us to
deploy capital with climate change resilience in mind. More detail on
the risks to our business associated with these challenges are set out
in the Risk Management section of this disclosure and the Managing
Risk and Opportunities section of this report on pages 68 to 69.
Biodiversity at Goscote Wastewater Treatment Works
Running a Business that Goes Hand-in-Hand with Nature continued
40 | Severn Trent Plc Annual Report and Accounts 2025