APPENDIX 2: INDUSTRY-WIDE SUMMARY OF COMPANIES^' SUBMISSIONS 2000-2005

In the main quality costings submissions (Periodic Review Submission D), companies indicted the possible obligations (cost drivers) that would lead to specified asset improvements. These have been summarised in the paper. Industry totals derived from the company estimates are included here, with brief summaries of the quality enhancements, typical solutions proposed by companies and the number of sites or length of water mains affected. There has been some rephasing of work programmes. Detailed definitions of the enhancements costed are set down in the PR99 Information Requirement D Main Quality Costings Submission – Reporting Requirements, which is available from the Ofwat library.

Water Service

All in £m at 1997-98 prices			Industry total costs		Description of the obligation	Typical company solutions	No of sites or km of mains
Cost Driver and Code[1]			Capex £m	Opex [2] £m/year
Water Treatment Nitrate	- - -	A1 B1 C1	<10 20 200	0 1 17	To reduce the nitrate level to comply with the current legal levels of 50 microgrammes per litre (ug/l)[3]	Blending water from different sources Providing ion exchange treatment plant Providing membrane treatment plant	73
Water Treatment Pesticides	-- -	A2 B2	<10 60	1 2	To reduce pesticide levels to comply with the current legal level of 0.1lug/7	Blending water from different sources Additional treatment such as Granular Activated Carbon (GAC) filtration or or both	13
Water Treatment Iron and Manganese	- -	A3 C2	<10 20	<1 6	Reducing the iron and manganese levels to comply with current legal levels of 200 ug/l and 50 ug/l respectively.	Additional treatment stages such as Aeration/Oxidation Biological filtration. Clarification (settlement)	25
Water Treatment Plumbosolvency	- -	A4 C10	<10 50	<1 8	Reducing the plumbosolvency of water entering distribution in zones with lead pipework.	Chemical conditioning of water to reduce its ability to dissolve lead eg Phosphote dosing, pH control	94
Water Treatment Other paramaters	- -	A5 A11 B3 C3	0 <10 100 140	0 0 5 8	Asset improvements to comply with other parameters in the Water Quality Regulations.	Varying schemes which require either addition to, or modifications of existing treatment facilities eg improving contact tanks to optimise disinfection	73
Water Treatment Cryptosporidium	- -	A10 D9	<10 300	<1 24	Improvements to reduce the risk of cryptosporidium oocysts[4] reaching final potable water supplies.	Changing the method of plant operation eg not recycling wash water from filter beds. Controlling washing of these beds more closely. Improving or adding to filtration facilities/improving micro filtration and membrane filtration.	138
Water Treatment Chlorinated solvents (10ug/1 individual) Chlorinated solvents (10ug/1 Total) Chlorinated solvents (2ug/1 & 3ug/1 individual)	- - -	C8 D5 D4	0 30 40	1 1 2	To comply with the proposed new Drinking Water (DW) Directive and achieving the new standard after 5 years Chlorinated solvents – trichloroethene and tetrachloroethene. The possible limits may be subject to change, so three different standards were costed: a) individual totals of 10ug/1 for one of the solvents, b) sum total concentration of 10ug/1 and c) 0.3ug/1 and 0.2 ug/1 respectively.	Allowing water the chance to become oxygenated after leaving the ground, before further treatment. More expensive options included installing GAC treatment or even membrane treatment. Chlorinated solvents in groundwater are usually a result of industrial contamination of the aquifer.	25 21 25
Water Treatment Bromate (10ug/1)	-	C11	100	7	Asset improvements to comply with the proposed new bromate standard of 10ug/1, if the DW Directive is adopted in 1998 and the standard has to be achieved in 5 years.	A change in the way that ozone is used to treat water or a change in the type of disinfectant used in water (or its method of generation eg chlorine from brine)	76
Water Treatment THMs (100ug/l maximum)	-	C12	240	15	Asset improvements are required to deal with a proposed maximum permitted standard for trichloromethane, bromodichloromethane, dibromochloromethane and tribromomethane of 100 ug/1 (Trihalomethanes or THMs)	Treatment by microfiltration or better coagulation and additional treatment stages. Good disinfection control is vital.	42
Water Treatment Turbidity (80%) Turbidity (95%)	- -	D6 D7	10 110	<1 5	Asset improvements required to comply with a possible turbidity standard of INTU (Nephelometric turbidity units). Options have been costed for 80% compliance and for 95% compliance as being acceptable	Addition or optimisation of filtration systems. Also improved clarification and settlement during the treatment processes. More complex treatment includes membrane technology.	43
Water Treatment Clostridia	-	D8	330	18	Asset improvements required to deal with clostridia detection in 100ml samples. Only measured if water originates from, or is influenced by surface water. Asset improvements only required if there is a risk to public health specifically indicated by the presence of clostridia.	Where companies have specified a treatment process, it involves membrane technology.	109
Water Treatment Arsenic (10ug/1)	-	C13	50	3	Asset improvements to comply with a proposed arsenic standard of 10ug/1. Assuming standard to be achieved after 5 years.	Alumina bed systems to be added onto the plant. Ferric hydroxide and membrane technology.	29
Distribution[6] – Relining (to fulfil (S19 Undertakings) Fe&Mn PAH Fluoranthene All/either	- - - -	C4 C6 D1 A6	430 40 180 20	<1 0 <1 0	Relining of water distribution mains to fulfil the requirements of section 19 undertakings for improvements due to the condition of the distribution system.	Relining is a perfectly acceptable method of mains rehabiliation to deal with a quality problem in an otherwise serviceable main. It is a cheaper option than relaying mains.	5,800 850 3,650 510
Distribution – Replacement (to fulfil (S19 Undertakings) Fe&Mn PAH Fluoranthene All/either	- - - -	C5 C7 D2 A7	1300 10 150 10	<1 0 0 0	Relining of water distribution mains to fulfil the requirements of section 19 undertakings for improvements due to the condition of the distribution system.	Replacement of distribution mains	18,800 140 1,560 100
Distribution - Lead pipes partial (10ug/1 median) Lead pipes total (10ug/l max)	- - -	A8 C9 D3	0 300 1100	0 0 0	Lead communication pipe replacement to comply with the proposed new DW Directive for lead measured at the customer's tap.	Replacement of company owned lead communication pipes excludes those replaced in other circumstances. Pipe replacement is considered the only method of attaining the 10ug/1 max. standard, also the median standard in some areas	(Nr (million) 0 1 2
Distribution - Other	- -	A12 B4	0 30	0 <1	Asset improvements for water distribution work confirmed as necessary by the DWI. May include chalk deposits in the mains.	Descaling or other cleaning methods. Scouring or "pigging" mains for water quality reasons such as bacteriological growth or deposits were also included.	Various
Environmental Obligations Low Flow Rivers	-	A9	0	0	Asset improvements included for 1995-200 to alleviate low flow in rivers due to abstraction of raw water supplies. Schemes confirmed by the EA	Re-siting of water intakes to lessen impact on low flow rivers.	1
Environmental obligations Habitats Directive Well defined Not identified investigation	- - -	C16 D10 D11	150 10 <10	1 <1 0	The abstraction will be on the priority list of English Nature (EN) or Countryside Commission for Wales (CCW) as affecting the local environment. "Well defined" where the role of a company abstraction has been defined. "Not identified" where there is a potential impact as yet unknown. "Investigation" where there is not a high risk to plants and animals, but assessment required.	Finding alternative water sources, changing the licence arrangements or expenditure to investigate.	2 10 13
Environmental obligations SSSI interest Identified Not calculated Investigation	- - -	D12 D13 D14	70 <10 0	1 0 0	Conservation agencies note Sites of Special Scientific Interest to the EA and water companies, who have a duty to further their conservation. "Identified" where the role of a company abstraction has been noted. "Not calculated" where there is an unquantified impact. "Investigation" where there is not a high risk to plants and animals, but assessment is required.	Finding alternative water sources, changing the license arrangements eg seasonal reduction or provision of compensation water expenditure to investigate.	7 8 11
Environmental obligations Over-abstraction Priority sites Problem sites	- -	D15 D16	100 10	3 1	Abstractions qualify if on the EA Priority list or Problem list of sites affected by abstraction. The distinction dictates the extent of the cost proposals Investigations are required to determine rates of abstraction for the affected source of supply. Only Investigations costs are included.	Costs for re-siting sources, changes in abstraction patterns or compensation flows. Investigations	27 43

APPENDIX 2 – Sewerage Service

All in £m 1997-98 prices			Industry total costs		Description of the obligation	Typical company solutions	No of sites (7)
Cost Driver and Code [1,8]			Capex £m	Opex (2) £m
Intermittent Discharges UWWTD Freshwater UWWTD Estuarial UWWTD Coastal Bathing Waters Intermittent discharges	- - - - -	E1 E3 E5 E7 H5[9]	90 30 10 0 1550	0 1 0 <1 7	Improvements to sewerage assets to comply with the UWWT or Bathing Water Directives. Includes improvements on storm and emergency overflows and associated modifications to sewers. Improvements to sewerage assets to comply with the UWWT Directive for which only partial funding had been provided for the period 200-05.	} } }Reduction of overflow spill volume and frequency; additional storage; installationof screens; overflow closure. } }	1,577 76 107 23 2,600
UWWTD Continuous Discharges Sensitive Areas	- - -	G4 G4+H3 G4+H3+H4	0 580 840	1 13 17	Improvements required due to the discharge becoming a UWWT Directive qualifying discharge to an established Sensitive Area during 200-10. As for G4 and including discharges to proposed Sensitive Areas where nutrient removal is confirmed by the EA. As for G4+H3 and including discharges to proposed Sensitive Areas where nutrient removal may be required by the EA.	} } ]Nutrient removal (phosphorus and/or nitrogen) by biological treatment or chemical dosing. }	10 98 174
Less Sensitive Areas		F1+G3 F1+G3+H1+F3 (part) ~ F1+G3+H2+F3(part)	130 460 580	5 13 21	Improvements to discharges to High Natural Dispersion Areas (HNDAs) requiring primary treatment, subject to a successful comprehensive study plus improvements required as a result of judicial review of Humber and Severn estuary boundaries. As for F1+G3 and including larger discharges for which comprehensive studies were unsuccessful and therefore secondary treatment is required by 31 December 2000. As for F1+G3 and including smaller discharges for which comprehensive studies were unsuccessful or any discharges where HNDA status is revoked, and therefore secondary treatment is required by 31 December 2005.	} Primary/Secondary treatment of sewage effluents. }	11 39 50
Normal Areas	-	G1+G2+G5+E2+E4+E6	1320	72	Improvements to sewage treatment works discharging to normal receiving waters to comply with requirements of UWWT Directive.	Preliminary, primary and/or secondary treatment of sewage effluents; outfall extension.	1,670
Sludge UWWTD UWWTD+ RCEP UWWTD + RCEP +EC Sludge to Land Directive	- - -	G6 G6+H6 G6+H6+H8	50 670 1160	10 43 83	Improvements at disposal facilities to meet UWWT Directive requirements where work is not scheduled to start before 31 March 2000. Improvements at disposal facilities over and above those required for G6 to conform with recommendations of the Royal Commission on Environmental Pollution – 19th Report(1996). Improvements at disposal facilities over and above those required for G6+H6 to conform with the EC Sludge to Land Directive.	} } Provision or enhancement of existing sludge treatment and dispoal facilities (eg digester uprating, cake storage, thickening, thermal drying, incineration) }
Freshwater Fish Directive	- - -	G7 G7+H9 G7+H9+H10	230 370 720	3 6 10	Improvements to discharges, which cause failure of a Statutory Objective at the point of discharge, where this is within the designated area. As for G7 and including discharges into stretches identified by the EA for possible new designation. As for G7 but where the river quality fails the Operational Standard for the stretch.	} Secondary treatment generally involving nitrification.	180 373 597
First Time Sewerage	- -	F2 F2+G8	20 190	1 2	Asset improvements relating to successful applications under Section 101A of the Water Industry Act 1991 before September 1997 where engineering work is scheduled before 31 March 2000. Asset improvements relating to successful applications under Section 101A of the Water Industry Act 1991 before September 1997 where engineering work is scheduled between 2000-2005.	Connect properties to the sewerage system, extend existing sewage treatment works, install package plants. As for F2	41 414
Shellfish Waters Directive	- - -	G10 G10+H11+H12 G10+H11+H12+H13	<1 80 80	<1 8 8	Improvements to discharges which cause failure of a Statutory Objective at the point of discharge. As for G10 but using standards arising from the government review of mandatory standards for metals and organo-halogens and for waters not yet designated. Similar to G10 but where the river quality fails the Operational Standard for that water.	} } High level sewage treatment eg tertiary sand filtration; UV disinfection. ]	2 63 66
Surface Water Abstraction Directive	- - -	G11 G11+H14 G11+H14+H15+H16	70 70 90	1 1 1	Improvements to discharges, which cause failure of a Statutory Objective at the point of discharge. Improvements to discharges, which fail to meet the Statutory Objective at the official monitoring point where the discharge quality is the same as the consented quality. Improvements to discharges with no relevant consent, which cause failure of a Statutory Objective at the point of discharge and/or river quality fails the Operational Standard for the stretch.	Installation of additional treatment for sewage effluents eg nitrification or denitrification.	1 5 8
Habitats Directive	- - -	G12 G12+H17 G12+H17+H18	50 70 70	1 4 4	Improvements to discharges which appear on the list of priority STWs drawn up by English Nature/Countryside Council for Wales and agreed on by the EA. As for G12 and including sites which have no proven link to water quality but which require that there is no deterioration from current discharge load. As for G12+H17, however, the sites' Conservation Objectives have not been formally advised to the EA.	Tertiary treatment; phosphorus removal	22 55 57
Bathing Waters	- - -	G13 G13+H19+H20 G13+H19+H20+H21	40 200 220	1 7 7	Improvements to discharges in order to comply with the mandatory standards of the Bathing Water Directive, or to maintain a guideline standard of compliance or no deterioration. As for G13 and including discharges likely to contribute to failures of the Directive as judged by the EA and those likely to cause failures to waters currently under consideration by DETR for bathing water identification. Improvements to discharges in order to comply with the guideline standards of the Bathing Water Directive.	} } Additional treatment possibly including UV disinfection: additional storm storage. }	10 42 51
Revised Bathing Water Directive [10]	- -	H22 H23	740 1120	14 16	Improvements to discharges in order to comply with the requirements envisaged by Halcrow Report scenario B.[5] Improvements to discharges in order to comply with the requirements envisaged in Halcrow Report scenario A.[5]	Secondary treatment of sewage effluents; UV disinfection; additional storm storage. Secondary/tertiary treatment; UV disinfection; additional storm storage.	Not provided Not provided
River and Estuarine Quality Objectives Quality	- -	H24-H30 H31-H37	1580 390	40 10	Improvements to discharges where the present quality or anticipated future quality will result in the water failing the planned quality objective. Improvements to discharges where the present quality has resulted in a deterioration in the 1990 River Class.	Upgrading of the treatment of sewage effluents including preliminary, primary, secondary or tertiary treatment. As for H1-24-H30	794 383
Miscellaneous [Other] Local priority schemes Discharges affecting Pilot SWQO catchments SSSIs (Effluent discharges) Flow measurement & recording Emergency provisions Misconnections	- - - - - -	H38 H39 H40 H41 H42 H43	130 30 30 40 10 30	3 1 2 2 <1 <1	Improvements to discharges not eligible under any other driver which can be backed by evidence describing the associated benefits. Improvements made to any discharge in order to support proposed SWQO. Improvements to discharges on EN/CCW's priority lists of sewage treatment works which have not already been identified under the Habitats Directive, and for which the EA agree that there is sufficient evidence of impact or risk. Provision of flow measurement structures to continuous and intermittent discharges where required under the EA's Flow Measurement Policy. Provision of emergency equipment at sites nominated by the EA for special risk status. Improvements to polluting discharges from surface water sewers identified by the EA as causing a serious local problem.	Various (eg borehole monitoring; installation of package plants; phosphorus removal). Secondary treatment (trickling filters; activated sludge). Phosphorus removal (biological treatment or chemical dosing) Installation of flow measurement equipment. Reduced operation; dual supply; emergency generation. Investigations; removal of misconnections.	131 28 35 Not provided Not applicable Unknown

Notes

[1] For details of each cost driver, refer to the reporting requirement for Periodic Review 1999 Information Requirement D – Main Quality Costings

Submission available from the Ofwat library.

The details of the environmental improvements are set out in 'Environment Agency Guidelines for identifying environmental improvements qualifying for AMP3 investment' Version 6.0 November 1997.

[2] Operating costs are expressed as the additional annual operating costs when the assets are fully operational.

[3] One microgramme is one millionth of a gramme.

[4] An oocyst is a protective stage in the lifecycle of the cryptosporidium organism, which allows it to survive in adverse conditions.

[5] Sir William Halcrow & Partners carried out a study for the Department of the Environment in 1994-95. This study examined the likely costs of a number of scenarios relating to the implementation of the then proposed revisions to the Bathing Water Directive.

Scenario A is in accordance with the proposed revised Directive. The principal requirements are a mandatory zero enterovirus

Standard and a new mandatory for faecal streptococci of 400/100ml

Scenario B is in accordance with guideline standards in the existing Directive (E.coli and F. streptococci both 100/100ml)

[6] Figures have been rephased to give level expenditure. Only costs and activity for 2000-05 are shown.

[7] For the sewerage service this is the total number of sites included in the submissions.

[8] For E and F cost drivers the data is incomplete. The figures given are not the total costs or number of sites, they only include those specifically identified individuals in company submissions.

[9] The companies costed completion of the entire CSO programme at £1,680 million. This cost is shown.

[10] These costs are unlikely to be incurred in the period 2000-05.

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