Thames Water Services

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• Thames Water Services
• working with clients partners to provide
  utility solutions for future urban demand

INTA 30 World UrbanDevelopment Congress 9th
October 2006
John MitchellBusiness Development
Director john.mitchell_at_thameswater.co.uk
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Content

• Thames Water
• Understanding the Challenges
• Example of Stresses on London
• Potential Solutions and benefits
• The Pitfalls!
• Summary

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Thames Water
Scottish Water Solutions
Seafield
Loch Katrine
Nevis Water
Omega
Terra Eco Systems
Engenica

Battersea
Dwr Cymru Customer Services
Ebbsfleet Valley
Terra Eco Composting
Engenica
Tidworth
Allenby Connaught

• Thames Water - Non-Regulated
• Non regulated business of Thames Water
• No. 2 in the UK
• 500m (equivalent) turnover in 2005
• 1600 employees

• Thames Water - Regulated
• Regulated business of Thames Water
• Largest in the UK
• 1.3bn turnover in 2005
• 5000 Employees

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Understanding the challenges

• Decreasing Supply

• Climate change likely to reduce supply by
  gt10
• Environmental legislation

• Increasing Demand
• Climate change
• Increased population economic growth
• Reduced household size
• New Activity eg Olympics 2012
• Client Demand
• Low up front costs
• Long term operation maintenance contracts
• Single point of contact for all utilities
• Flexibility of solution

• Environmental stewardship

• Reduced carbon emissions
• Water conservation
• Wastewater treatment standards

• Constraints

• Existing infrastructure
• Current regulatory regime legislation

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Drivers stresses on London water supply

• Thames river basin one of most heavily used
  systems in the world
• Population increase of 800,000 over next decade
  equivalent to Amsterdam!
• The area is a cloudy desert !
• 55 of effective rainfall already utilised
• Customer demand for water will increase by 20 by
  2030

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Potential Solutions

• New operating models
• Multi-utility installations
• New technology
• Low water use toilets and showers
• Grey/black water reuse
• Bio mass combined cooling heat and power (CCHP)
• New financial models
• Private Finance Initiative (PFI)
• Leaseback

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The multi-utility joint venture model

Land owner / lead developer
Multi utility SPV
Funding
Stake holders
Design and Build
Operate
Independent Gas Transporter
Off site
Primary
Local
Telecoms
Gas Operation
Water and Sewerage
Power
Gas assets
Telecoms Partner
Power Supplier
Package Developers
Customers
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Developing sustainable solutions- Enabling
sustainable technology
Funds available to invest in sustainability
Actual Cost
Budget
0m
Traditional Utility Approach
20m
20m
10m
Increased Flexibility for incorporating
sustainable technologies
Multi-utility Installation
2m
10m
10m
8m

Multi-utility JV Model
5m
10m
5m
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The potential pitfalls

• Millennium dome experience
• Customer behaviours
• New technology not fully understood
• Affordable solutions
• Treatment costs of recycled water is more
  expensive
• Regulatory issues
• Licensing position for new operating model not
  fully established

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Summary

• Changing the approach to utilities provision is
  not an option, it is a must!
• Must maintain
• Quality of product and service
• Environmental considerations
• Value for money
• Need to develop drive
• Flexibility in solution customer choice
• New operating financial models and technical
  solutions