Utility Week

UTILITY WEEK | 12TH - 18TH APRIL 2019 | 11 This week Tideway reports 8% rise in tunnel costs Revised cost of the Thames project now stands at £3.8 billion, but customers will not pay more Tideway has revealed the cost of building's London's new "super sewer" has increased by around 8 per cent. In its latest update, the firm said the revised cost of the Thames Tideway tunnel now stands at £3.8 billion, compared with the original estimate of £3.52 billion, a•er completing the "first and most unpredictable" phase of the work. But the company added there will be no change to the estimated £20-£25 annual cost for Thames Water bill payers as "costs remain well within the original projec- tion for customer charges". The update also shows that 40 per cent of the con- struction work on the sewer is complete and the com- pany is on track to deliver the project on time by 2024. "As we approach the halfway point of construction, the time is right to update our cost estimate," said Tide- way's chief executive Andy Mitchell. "The most important thing to say is that there will be no impact on the estimated cost to Thames Water bill payers and to recognise that our teams have done a great job in getting us this far and keeping us on schedule. Every day we get closer to our aim of giving London a cleaner river." When finished, the tunnel will run from Acton in west London to Stratford in east London. Construction is taking place at 23 sites across the city and Tideway is using the river instead of roads as far as possible to build the project, cutting the impact on road congestion and air quality. JH GAS SSE to pay £700k for missed meter target SSE's domestic retail business SSE Energy Services missed its gas smart meter installation target last year and will pay £700,000 to Ofgem's consumer redress fund to make amends. As part of the government's smart meter rollout, suppliers with more than 250,000 custom- ers are required to set individual annual targets for installations with Ofgem. These targets are commercially confidential. SSE failed to meet its gas smart meter target during 2018, although it hit the figure in Feb- ruary this year. The company did achieve its electricity target. SSE has agreed to pay £700,000 to Ofgem's consumer redress fund, which supports vul- nerable consumers and develop- ment of innovative products. WATER UU awards three AMP7 contracts United Utilities has awarded three five-year contracts worth £17 million a year to Sapphire Utility Solutions as part of AMP7. The contracts are for: Lot 3 – core repair and maintenance wastewater works in the North region; Lot 6 – wastewater minor civils works across the region; and Lot 9 – wastewater major civils works across the region. The works will include jet- ting, CCTV investigations, sewer lining, civils activities and the provision of recycler units. ELECTRICITY Interconnector de- rating 'conservative' Consumers are overpaying for the capacity market due to the "flawed" methodology used to determine the de-rating factors for interconnectors, a new report from FTI Consulting has argued. According to the analysis commissioned by National Grid Ventures, the current de-rating factors are "unduly conserva- tive", risking over-procurement in capacity auctions. The de-rating factors for interconnectors take into account the historical availabil- ity of interconnectors in Great Britain as well as the modelling of energy markets across Europe. Last July, energy and clean growth minister Claire Perry lowered the de-rating factors for interconnectors bidding in the T-4 auction from 63 per cent to 56 per cent on average. But the report from FTI says these de-rating factors undervalue the contribu- tion of interconnectors to security of supply. They are "considerably below" the levels implied by the historical availability of intercon- nectors alone, which instead sug- gests de-rating factors of between 75 and 95 per cent for all except those to Ireland. Mitchell: 'teams have done a great job' so far Finance & Investment Stock watch 125 120 115 110 CENTRICA SHARE PRICE, FIVE DAY 19 Mar 27 Mar 4 Apr CENTRICA SHARE PRICE, ONE MONTH Centrica's share price fell more than 3 per cent between 3 and 5 April aer the company warned it may be forced to cut around 500 jobs in the UK, partly as a result of the introduction of the price cap on default tariffs. Having traded at around 114p for most of Wednesday, Centrica's share price had dipped below 110p by Friday aernoon. As Utility Week went to press on 9 April, Centrica shares were trading at just over 109p. 116 114 112 110 108 4 Apr 5 Apr 8 Apr 9 Apr pence pence

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