Bazalgette Finance (Tideway), the company financing, building, maintaining and operating the 25km wastewater tunnel has announced the latest modelling indicates construction work, which was due to be completed in 2024 (the project 'handover' date), is now likely to be completed in the first half of 2025, adding nine months to its current schedule.
The approved revised forecast adds GBP233m to the previous forecast, taking the estimated project cost to GBP4.133bn.
Tideway is in discussions with Ofwat on a package of measures that would mitigate the financial impact of Covid-19 on the company. It added these discussions expect to reach a full agreement in the coming months.
Following a temporary pause of all but essential works at the start of the UK lockdown, construction work recommenced on the majority of the company's worksites in May.
Tideway is owned by a consortium of investors that comprises Allianz, Amber Infrastructure, Dalmore Capital and DIF. Contractors include BAM, Morgan Sindall, Balfour Beatty, Ferrovial, Laing O’Rourke, Costain, Vinci, and Amey.
Meanwhile Ofwat is now identifying an innovation fund partner through a tender process to help it run competitions and will be releasing further details in the Autumn. The regulator has made up to GBP200m of funding available which will be accessed through a series of annual competitions during 2020-25.
John Russell, senior director at Ofwat, said: “The introduction of innovation funding and an innovation competition will act as a catalyst for change, encouraging new ideas and approaches to help address current challenges.
By emphasising the need for stronger collaboration and partnership across the sector and beyond, we believe innovation funding and the innovation competition will help accelerate change. I look forward to appointing an innovation fund partner to help us with the design, implementation and ongoing monitoring and administration of the innovation competition and make a real difference for customers and the environment for years to come.”