Capital expenditure split between water and wastewater
Over the next five years (2005-10) capital investment on water will
be £8 billion and on sewerage £8.8 billion. This continues
the trend from AMP 3 when 55% of capital investment was on the sewerage
service.
This is a complete reversal of the situation in the years 1990 - 95
when water was the dominant area for investment. Now sewage treatment
is the largest area. This reflects the massive investment in coastal
sewage treatment works to meet the requirements of the Urban
Waste Water Directive. A good example would be the £30m new sewage
treatment works that has been commissioned for Weston-super-Mare. Even
though most of the obligations under the UWWD have been met this situation
is continuing primarily due to the need to increase capital maintenance
expenditure to ensure asset servicability is maintained.
Gross capital investment by service area
Water
Sewage
Source: OFWAT report on financial performance of the water companies
Water distribution continues to be a major area of investment. This is not new pipwork to meet increased
demand - demand for water is static - rather it is expenditure to reduce contamination problems from
old pipework and of course to reduce leakage.
Historic split in capital spend
Source: OFWAT report on financial performance of the water companies
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