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The State of UK Water in 2025

Britain’s water crisis has become difficult to overlook. Underneath the headlines of ongoing pollution incidents, drought alerts, and the financial challenges facing sector giants like Thames Water, lies a systemic issue with significant implications for public health, business, and the environment. As an organisation working closely with retailers, communities, and impact investors, Water Unite’s exploration of UK water is shaped by its practical experience in funding and scaling water solutions globally. While water has at times been assumed as an abundant and reliable utility, it is now increasingly regarded as one of the key strategic risks facing even more communities than ever, at home and abroad.

Rivers in Danger

The scale of water pollution in England is substantial. Serious river pollution incidents have surged by 60 percent in the past year, a record-breaking increase according to the Environment Agency (BBC News, 2025). After storms and downpours, many rivers, including the Thames and Wandle, have turned brown due to illegal sewage spills, with thousands of discharges logged in 2025 alone (BBC News, 2025; Sustainability Magazine, 2025). Anglers along the Thames describe seeing fewer fish than ever before while local swimmers now worry about health risks.

Pollution is not just about the things you can see. “Forever chemicals” (PFAS) are man-made chemicals used in products like non-stick pans and waterproof clothing. They stick around in the environment and our bodies for years, which is why they’re referred to as “forever” substances. Once rarely seen, PFAS are now often detected in river systems, including areas that supply drinking water and support fisheries (York University, 2025). These chemicals barely degrade and have been linked to serious health effects and loss of biodiversity.

Utility companies have also contributed to the problem, with persistent failures to upgrade ageing infrastructure (BBC News, 2025). As a result, community groups have organised river cleanups and called for urgent action after repeated sewage spills. Regulatory fines have followed, but they have not stopped the overall rise of pollution (Reuters, 2025). The message is clear: the UK’s patchwork approach to river health is crumbling under pressure.

Drought and Depletion

Drought is no longer a temporary inconvenience. This year saw the driest spring since the 1950s, and official warnings now cover five drought-stricken areas, with six more at risk (National Drought Group, 2025). In East Anglia, groundwater levels have dropped so low that the River Lark ran dry for several days, leaving stranded fish and causing losses for farmers (Hutton Institute, 2025). What’s more, some farmers in Cambridgeshire have reported a drop of up to 40 percent in crop yields due to low rainfall and restrictions on irrigation.

Nature reserves have suffered too. Mass fish deaths have been reported in dry river pools across the South while wetlands in the Norfolk Broads have withered, reducing habitat for rare birds and amphibians (BBC News, 2025). This pattern illustrates a global trend, mirroring water crises in the Global South such as Cape Town, South Africa’s 2018 drought, where nearly four million people faced the threat of “Day Zero”, the moment citywide taps were at risk of running dry. The crisis exposed how drought and climate change can devastate not just natural habitats but entire urban populations, as business, agriculture, and everyday life were forced to adapt through emergency measures and strict government interventions (SIWI, 2024; Brookings Institution, 2023). Similar challenges now threaten rapidly growing cities and communities throughout Africa, Latin America, and Asia, where water insecurity and ecological loss go hand in hand. Scientists and conservationists stress the need for long-term monitoring and the sharing of water data between agriculture, utilities, and regulators, viewing collaborative models like Zaragoza, Spain, which reduced urban water use significantly, as critical solutions for the Global South, where the vulnerability to water shortages is even greater (WWF Europe, n.d.; SIWI, 2024).

Utilities in Crisis: The Current Dilemma

If there is ever a case that shows the risks of deferred investment and regulatory gaps, it would be Thames Water. In 2025, the company posted a loss of £1.65 billion and reported a 30 percent increase in pollution events as its debt climbed above £16.8 billion (Reuters, 2025; BBC News, 2025). Residents in areas like Oxfordshire recount weeks of cloudy tap water and persistent river pollution. Interestingly, the company suspended executive bonuses and drew scrutiny from Parliament and Ofwat, with nationalisation now openly debated (BBC News, 2025). 

A surge in pollution fines has not kept pace with the need for investment in new pipes and treatment plants. For instance, local action groups in London tracked more than two hundred pollution episodes since January and documented the slow pace of infrastructure upgrades (BBC News, 2025). The case for Thames Water, however, is not unique. Critics argue that a focus on dividend payouts and debt servicing left networks vulnerable and delayed much needed investment in pollution control and leak repair (Reuters, 2025). With headlines like these, the question for many is whether private sector management can champion public health and environmental accountability.

Privatisation as a Step Towards Accountability?

Privatisation was intended to deliver better service, but many now declare that the results have been disappointing. Fragmented ownership and short term profit focus have left infrastructure in poor shape. This has led to pollution events and drought impacts becoming more frequent (BBC News, 2025). During the River Severn floods in 2024, communities faced persistent service outages largely attributed to years of deferred maintenance (Sustainability Magazine, 2025).

Calls for renationalisation have grown, however others point to successful international reforms that are driven by clear governance, strong data sharing, and community engagement. In Zaragoza, Spain, coordinated civil society and city actions have reduced water use, but other regions offer different models. For example, Italy’s unified governance framework and the EU’s Commissioner for Water Resilience, demonstrate how merging expertise and cross-border planning can address complex water challenges without fragmentation (WWF Europe n.d.; World Economic Forum, 2025). What experts widely agree on is that the sector needs transparent data-driven governance and management. Regular reporting and monitoring of water use, pollution, and upstream supply chains must be standard across the industry, and investments should be prioritised for ecosystem health as much as profits (BBC News, 2025; Reuters, 2025).

What Real Resilience Looks Like

So what will it take? The answer is to treat water risk as local and specific. One that requires board level accountability, supply chain traceability, and science based scenario planning. Tools like the WWF Water Risk Filter and WRI Aqueduct have become key parts of long term resilience. UK companies must move beyond box ticking regulatory compliance to integrate water stewardship into their core strategy. Leading ESG reports now include basin specific risk mapping, supplier impact tracking, and corporate governance measures, which moves away from basic compliance metrics (CDP, 2023). Scottish whisky producers, for example, have begun tracing water sources upstream and working with conservation agencies to prevent shortages from drought and protect local rivers (CDP, 2023). 

Alongside transparent and comparable reporting, existing innovations in the water sector must be cultivated. These include water preservation solutions to tackle drought such as data driven platforms using AI to detect and reduce leaks across ageing infrastructure, as well as precision irrigation which helps farmers monitor and optimise water use at the field level. The risk of water pollution can be mitigated by water purification and reuse, decentralised water treatment and solid waste recycling technologies. The adoption and scaling of these innovations will be key to achieving a sustainable water system in the UK and beyond. 

In the meantime, business and society alike will remain vulnerable to shocks that make the headlines look mild by comparison.

As the problem of water insecurity persists, Water Unite is committed to supporting and scaling innovative solutions globally. We believe that when capital flows reach the missing middle, the water sector is capable of delivering lasting impact for people and planet.

References

BBC News. (2025, July 18). Serious water pollution in England up 60%, government says. https://www.bbc.com/news/articles/cg5zl75dmm0o

Brookings Institution. (2023, May 28). Cape Town: Lessons from managing water scarcity. https://www.brookings.edu/articles/cape-town-lessons-from-managing-water-scarcity/

Sustainability Magazine. (2025, July 20). UK serious water pollution up 60%. https://sustainabilitymag.com/news/how-is-the-uks-60-water-pollution-rise-harming-nature

York University. (2025, August 18). High levels of 'forever chemicals' found in UK rivers, study finds. https://www.york.ac.uk/news-and-events/news/2025/research/forever-chemicals-river/

Reuters. (2025, July 18). UK to set out water reforms as Thames Water faces crisis. https://www.reuters.com/sustainability/boards-policy-regulation/uk-set-out-water-reforms-thames-water-faces-crisis-2025-07-18/

National Drought Group. (2025, August 11). National Drought Group meets to address nationally significant water shortfall. https://www.gov.uk/government/news/national-drought-group-meets-to-address-nationally-significant-water-shortfall

Hutton Institute. (2025, June 4). Hutton scientists respond to the drought facing the UK. https://www.hutton.ac.uk/hutton-scientists-respond-to-the-drought-facing-the-uk/

World Bank. (2018, March 5). Cape Town’s water crisis shows us our relationship with water. https://www.worldbank.org/en/news/feature/2018/03/05/cape-town-water-crisis-shows-us-our-relationship-with-water

WWF Europe. (n.d.). Zaragoza urban water losses case study. http://www.wwf.eu/?235091/Zaragoza-Urban-Water-Losses

CDP. (2023). Global Water Report 2023. https://www.cdp.net/en/research/global-reports/water-report

World Bank. (2016). High and dry: Climate change, water, and the economy. https://www.worldbank.org/en/topic/water/publication/high-and-dry-climate-change-water-and-the-economy

SIWI. (2024, February 26). How Cape Town saved itself from Day Zero. https://siwi.org/latest/how-cape-town-saved-itself-from-day-zero/

WWF. (n.d.). Water Risk Filter. https://waterriskfilter.panda.org/

WRI. (n.d.). Aqueduct water risk atlas. https://www.wri.org/aqueduct

GOV.UK. (2025, August 10). Water situation: July 2025 summary. https://www.gov.uk/government/publications/water-situation-national-monthly-reports-for-england-2025/water-situation-july-2025-summary