Water Companies: Finance
The question
To ask the Secretary of State for Environment, Food and Rural Affairs, whether Ofwat's final determination for each company separates out anticipated spend on (a) direct procurement for customer projects and (b) specified infrastructure project regulations projects.
Answered by Emma Hardy
The development costs of funding Direct Procurement for Customer (DPC) schemes and Specified Infrastructure Project Regulations (SIPR) projects have been included in company business plans, as set out in Ofwat’s Major Projects Appendix. Funding is set out at individual project level and is identified as a DPC or SIPR (please see page 9). Almost all the schemes are funded via DPC and these account for £2.1 billion of development funding in PR24, and circa £50 billion whole life costs.
DPC is funded separately to enhancement expenditure. The capital costs of DPC will be spread over time and funded in addition to customer bill impacts forecast through the business plan submissions. DPC costs in the main will not occur in the next investment period (2025-2030), as DPC costs are passed through to customers once assets become operational.
Customer bills between 2025 and 2030 will include funding for the Haweswater Aqueduct Resilience Programme for United Utilities (delivered via DPC) and the Thames Tideway Tunnel (delivered via SIPR). Thames Water customer bills have included impacts from this scheme since 2015.
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