2005 - 2006 - Pinsent Masons Water Yearbook 2012

GERMANY PART 3 (i): COMPANY ANALYSIS: MAJOR PLAYERS
England
Thames Water Utilities Ltd., regulated activities in England
Y/E 31/03 (£million) 2001 2002 2003 2004 2005
Appointed business 1,002.2 1,054.6 1,073.7 1,105.2 1,142.2
Non-appointed business 26.9 31.7 36.6 36.1 35.5
Total turnover 1,029.1 1,086.3 1,110.3 1,141.3 1,177.7
Operating profit 376.0 358.0 397.4 378.0 392.3
Pre-tax profit 259.0 251.4 279.6 251.1 256.5
TWUL provides water supply to 8 million and sewerage services to 13 million customers in England,
around a quarter of the population of England and Wales, making it the largest UK water company.
Thames Water's regulated activities are in the south-east of England, including London. The
company’s origins lie in the New River Company, which was incorporated in 1619 and was eventually
nationalised by the Metropolitan Water Board in 1902, when it served 1.25 million people. The
modern Thames Water was formed by a merger in public ownership in 1974, and floated in 1989.
Post-privatisation, a program to upgrade 44 treatment works has been completed which covers 90%
of the company’s water supply. This has resulted in the reduction, and in some cases elimination of
trace elements in water exceeding the European standard of 10ug/1 that comes into force in 2013.
The complexity and age of Thames Water’s water and wastewater networks, linked to the difficulty of
operating within a major metropolitan city such as London has lead to the company attracting some
criticism over issues such as leakage, water resources and rising groundwater levels. Major capital
programs are already underway to address many of these criticisms.
London has a combined sewerage system, which was designed over 150 years ago, carrying both
rainwater and wastewater from customers' properties. Under severe storm conditions this can lead to
sewage being discharged directly into the Thames to prevent flooding in customers properties. The
resulting fish kills have attracted negative publicity. A capital scheme proposed by the company to
prevent these discharges has not yet received regulatory or government approval.
TW will be carrying out a £3.1 billion investment programme between 2005 and 2010. A major part of
this will be the planned replacement of 850 miles of water mains in London, as well as an accelerated
programme to reduce the risk of sewer flooding to 10,000 properties across the region, despite this
TW has the joint lowest average combined bill for water and wastewater services in England and
Wales.
TW has a number of plans to combat the issue of water resources into the future including a new
reservoir in the Upper Thames Valley. Plans have also been drawn up for the UK's first large scale
desalination plant. The £200m works is intended to converted salty water from the tidal Thames in
east London into drinking water. It will have a maximum treatment capacity of 150 million litres of
water a day, enough to supply 900,000 customers, using reverse osmosis technology. This scheme
has encounter resistance from the Mayor of London whose permission is required for the work to go
ahead.
Thames Water Services
Metronet
2003 Metronet BCV 30 year maintenance and refurbishment £16,000 million turnover
2003 Metronet SSL 30 year maintenance and refurbishment £14,500 million turnover
Metronet Rail, a consortium consisting of Atkins, Balfour Beatty, Bombardier Transportation, EDF
Energy and RWE Thames Water each with a 20% share, is responsible for upgrading, replacing and
maintaining two-thirds of London Underground's infrastructure. This includes trains, stations,
signalling, track, tunnels and bridges. The contract is a 30-year Public Private Partnership (PPP)
contract which came into operation in April 2003. Lines covered by Metronet are the Bakerloo, Central
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Pinsent Masons Water Yearbook 2005 – 2006