Water regulator Ofwat has proposed a £44.7 million enforcement package for Dŵr Cymru Welsh Water after finding what it described as “serious and unacceptable” failures in the way the company operated and maintained parts of its wastewater network.

The watchdog said its investigation found the utility had failed to properly run, maintain and upgrade sections of its sewer system to cope with the volume of sewage and wastewater flowing through it. According to Ofwat, that failure contributed to excessive discharges from storm overflows into rivers and coastal waters.

Under the proposed enforcement action, Welsh Water would invest £40.6 million on measures aimed at reducing sewage spills and limiting environmental damage. A further £4.1 million would be spent on projects designed to improve river quality in particularly sensitive catchment areas.

Ofwat said the investment would focus on improvements to the sewer network and tackling groundwater entering pipes – a problem known as infiltration that can overwhelm sewer systems during periods of heavy rain and lead to storm overflow discharges.

Lynn Parker, senior director for enforcement at Ofwat, said the investigation had uncovered significant failings in the management of sewage works and infrastructure.

She said: “Our investigation has found serious and unacceptable breaches in how Dŵr Cymru Welsh Water has operated and maintained its sewage works and networks, which has resulted in excessive spills from storm overflows to the environment.

“We now expect them to focus on putting things right so that customers can regain trust in their water company and the critical service they provide.”

The regulator said the improvements must be delivered by 2030 and stressed that the cost would be borne by the company rather than passed on to customers through higher water bills.

Concerns about sewage pollution have become a major environmental issue across Wales in recent years, particularly in popular rivers and coastal areas.

In North Wales, campaigners and environmental groups have repeatedly raised concerns about pollution incidents affecting rivers including the River Conwy and the River Dee, both of which are important for wildlife, tourism and recreational activities such as fishing and kayaking.

Storm overflow discharges have also drawn criticism in coastal areas such as Colwyn Bay and Rhyl, where local communities and environmental organisations have called for stronger action to protect bathing waters and marine habitats.

Welsh Water has previously announced major investment plans aimed at improving wastewater infrastructure and reducing spills, with hundreds of millions of pounds earmarked for upgrades across Wales during the current regulatory period.

Ofwat said the proposed enforcement package is intended to ensure that further improvements are delivered more quickly, particularly in areas where environmental damage has been most significant.

The regulator added that the focus must now be on restoring confidence among customers and ensuring the company provides the reliable waste water service expected by communities across Wales.