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UK water companies 'must up infrastructure investment'

UK water companies need to significantly increase infrastructure investment, according to a new asset management research report.

The report – Long Term Investment in Infrastructure – was carried out by business optimisation provider Servelec Technologies on behalf of UKWIR, in partnership with Frontier Economics and Atkins Global. The result of work started in May last year, it aims to present a body of evidence for the long-term infrastructure needs of the UK water industry which could be presented to government and industry stakeholders.

The report, to be published by UKWIR soon, will show that UK water companies need to significantly increase levels of expenditure in infrastructure, both in the medium and long-term if current service standards are to be maintained. Without increased expenditure in infrastructure the 350,000km of water mains and 625,000km of sewers in the UK will begin to fail more often, the research shows.

Increased expenditure requires financing, which will need to be achieved through increases in consumer bills. Using a model of the way water companies are financed in England and Wales, the team from Frontier Economics used Servelec Technologies’ analysis to estimate the effect the additional investment will have on bills to be an additional 0.7% increase year-on-year to 2050.

Using Servelec Technologies’ asset management software PIONEER as an analytical tool, the project team was able to determine an acceptable level of investment based on a variety of short and long-term scenarios which included the effects of social and climatic changes and the potential benefits of future technologies.

Following the completion of the report, Technical Director George Heywood said: “We are pleased with the body of evidence we have provided to the UKWIR Steering Group and we hope that the UK water industry as a whole will benefit from this research.

“The report will advise UK water companies, the Government and industry authorities of the level of investment that is required to achieve the replacement and rehabilitation needed to offset deterioration of UK water networks due to age and use, and the subsequent impact on the consumer.

“The project team’s thorough analysis has made use of national asset databases, combined with deterioration, service, cost and optimisation models. It shows that if the industry does not increase expenditure then bursts, interruptions, flooding and pollution will happen more regularly, in opposition to the increasing service expectation of customers. Failing to increase expenditure now will result in significantly higher recovery costs in future years adding to the burden on the consumer and network infrastructure.”

UKWIR (UK Water Industry Research) was set up by the UK water industry in 1993 to provide a framework for the procurement of a common research programme for UK water companies on 'one voice' issues. UKWIR's members comprise 22 water and sewerage companies in England and Wales, Scotland, Northern Ireland and the Republic of Ireland.

Author: James Brockett,
Topic: Asset Management
Tags: asset management , infrastructure

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