International comparisons - sewerage service unit costs: results for 2006

International comparisons - sewerage service unit costs: results for 2006–07

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Introduction	Customers' bills	Unit costs	Customer service levels	Water quality
Environmental performance	Water balance	Water efficiency	Leakage	Network activity

International comparisons - sewerage service unit costs: results for 2006–07

Key conclusions

Comparisons based on number of properties suggest that the average total costs for sewerage services are the same in England and Wales and Scotland.
Comparisons of volumetric unit costs suggest that the Australian and Canadian companies provide sewerage services at a lower cost than companies in England and Wales. However, higher levels of sewage collected distort comparisons.
The level of sewage treatment impacts on the unit cost. Australia has high operating costs because of more tertiary level treatment while Canada has the lowest because of sewage being treated to secondary level.

Table 7 reports the sewage collected unit costs results in pounds per property (£/prop) and pence per cubic metre (p/m³). Currencies have been converted to sterling using the Organisation for Economic Co-operation and Development purchasing power parities (PPP) exchange rates for the appropriate time period. Details of the PPP exchange rates used are given in table 1.

England and Wales and Scotland have the same average total cost for sewage collected on a £/prop basis. Scottish Water's total sewerage costs in p/m³ are slightly higher than the England and Wales average. Looking at the functional areas, Scottish Water's return on capital is higher than the England and Wales average but is within the range for these companies.

Australia reports a slightly higher average total cost for sewage collected (£/prop) than England and Wales. This may reflect the fact that more sewage is treated to tertiary level in Australia than in England and Wales. On a volumetric basis, Australia's total unit costs are in the lower range of total costs for England and Wales, reflecting higher consumption per property. The average operating cost is higher but this is because it includes the costs of ongoing maintenance.

Canada has a lower average £/prop and p/m³ cost of operations for sewage collected than England and Wales. Although we may expect the cost of operation to be higher in Canada because of the climate, this is likely to be offset by the sewage only being treated to a secondary level.

The USA cost of operations includes maintenance costs. However, the operating and maintenance cost does not include depreciation because most utilities do not depreciate their assets. Overall, the operating and maintenance cost per property is higher for the USA compared to England and Wales. On a volumetric basis, the unit costs are lower because of the higher sewage collected per property.

Unit costs

Water service unit costs - results for 2006-07

Sewerage service unit costs - results for 2006-07

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