Ofwat is investigating South East Water over potential failures in maintaining water supply to households.
South East Water is the worst performer for supply interruptions in England and Wales since 2020.
The company will be scrutinised for customers experiencing outages lasting over three hours on average during the 2022-23 financial year.
It’s far beyond its agreed target of five minutes and 45 seconds.
South East Water faced criticism earlier for attributing a hosepipe ban in June to increased remote working.
The firm claimed it raised drinking water demand.
Ofwat is examining whether the water supplier in Surrey, Kent, Sussex, Hampshire, and Berkshire failed to establish and maintain an efficient water supply system.
“Too many customers have been failed too often by South East Water”
Ofwat CEO David Black said: “Providing reliable water supplies is at the heart of a water company’s responsibilities.
“Too many customers have been failed too often by South East Water.
“That’s why we are now carrying out a thorough investigation into the company and its service to customers.
“We are clear that water companies must do more to regain public trust and it must start with better service.
“Where this does not happen, we will use all of our powers to ensure the sector delivers better value for both customers and the environment.”
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The Drinking Water Inspectorate has also indicated potential enforcement action against the company to improve its supply system and incident response capabilities.
Ofwat will collaborate with the DWI to address concerns and secure compliance.
The water industry is under scrutiny due to various issues, including sewage dumping, leaks, financial practices, and executive pay.
Analysis by the University of Greenwich revealed South East Water spent £232 million on dividends and interest on debts in the two years to March 2022.
A spokesperson for South East Water said “resilience” formed a “major focus” for the company, adding: “We intend to fully cooperate with Ofwat on this matter.”