Tideway will not be completed until at least 2025 and will cost £4.13bn, it has been announced. The London super-sewer project was due for completion in 2024 at a cost of just under £4bn in its latest estimates. But in a statement today, trading company Bazalgette Finance said that an assessment of the impact of COVID-19 on its operations meant it would have to add nine months to its current schedule. Work on the scheme was paused in late March due to the lockdown, and restarted in May at a lower level of activity due to social distancing requirements. In its annual report published in June, the project’s completion date was still stated as 2024 despite the pandemic having already hit, though project leaders said a further analysis would be made later in the year. The statement from Bazalgette added that another £233m had been added to its cost forecast and that it had begun talks with water regulator and project client Ofwat about how to “mitigate the financial impact of COVID-19 on the company”. Funding for Tideway has been raised through the regulated asset base (RAB) model in which private investors buy stakes with financial protection provided by regular price reviews, with the potential for costs to be passed on to consumers through their water bills. If exceptional events see planned budgets exceeded, Ofwat can step in to make sure investors are protected. Tideway’s overall cost has increased from its original budget of £3.52bn, announced in 2014. The RAB model has previously been hailed as a possible replacement to PFI and as a means of funding nuclear projects. A government decision on its applicability to the nuclear energy sector is awaited following a consultation on its use last year.
Construction News 25th Aug 2020 read more »