The company, part of the Veolia group, appeared before St Albans magistrates on 19 May to plead guilty to two charges of supplying water unfit for human consumption, contrary to section 70 of the Water Industry Act 1991.
The court heard that new connections were made to three properties in Colney Heath in February 2006. Two of the properties were occupied from July and September but it was not until November that one of the residents complained about water discoloration.
Three Valleys Water checked the installation and discovered a connection error. The properties had been jointed to a water main carrying untreated water to the company’s treatment works. Fortunately the water was from a borehole and of relatively good quality.
An investigation by the company found the pipe had been used for treated water but its use was changed in 1997. Three Valleys had failed to keep its records up to date.
There was no evidence the misconnection had resulted in ill health. The local consultant in communicable disease control said the incident had involved "limited risks".
The company said: "As soon as we realised our mistake we took immediate action, informed the customers and corrected the problem that same day. We have undertaken a thorough investigation and now understand how the problem arose. We have reviewed our records and are confident this was a one-off event."