Accelerated Infrastructure Delivery Project

In October 2022, Defra asked English water companies to propose schemes for accelerated additional infrastructure delivery in 2023-24 and 2024-25 that would provide benefits for customers, communities, and the environment.

The proposed schemes should focus on three areas:

  • Water resilience (supply and demand),
  • Storm overflows, and
  • Nutrient neutrality.

We were pleased to receive formal submissions from all English water companies, bar SES.

When requesting proposals Defra set out several criteria, which given the accelerated nature of the process, included schemes had to be clear and uncontroversial. Other criteria included that projects needed to start this price control period (2020-25) and be finished by the end of next price control period (2025-30), schemes needed to provide additional benefits and schemes needed to be deliverable.

A key part of the criteria for acceleration is that companies would use the PR24 transition expenditure programme to fund the investments. This required Ofwat to make decisions on which schemes can be funded through the transition expenditure process, and we also considered the views of other regulators. This includes the Environment Agency, the Drinking Water Inspectorate (DWI), the Consumer Council for Water (CCW) and Natural England (NE).

In April 2023, Ofwat set our draft decision. Thank you to those who responded to our draft decision consultation document. Our final decisions take into account the consultation responses we received.

In June 2023, we published our final decision  to support the acceleration of 33 schemes, across 11 companies valued at around £500 million over the 2023-25 period and £2.2 billion overall.

Overall, the key headlines are:

  • £1.7bn to tackle storm overflows improving over 250 storm overflows and reducing the annual average of spills by 10,000. These efforts include enhancing water quality at Ilkley’s bathing water site on the River Wharfe and significantly curbing spills into Lake Windermere.
  • £350m for water resilience schemes including installation of 462,000 smart meters, new water resource and water quality projects. Collectively, these endeavours will safeguard and provide 161Ml/d of water supply, fortifying our resilience against droughts.
  • £160 million designated to combat nutrient pollution and achieve nutrient neutrality at 14 locations, safeguarding natural ecosystems, enabling the construction of up to 82,500 homes, and bolstering economic development.

In addition to this, we have identified a further 35 schemes, totalling potentially £371 million of investment, in the 2023-25 period and £1.3 billion in total, that companies can progress through the 2024 price review (PR24) transition expenditure programme at their own risk.