United Utilities has selected Jacobs and Tetra Tech/RPS to join its Strategic Solutions Team (SST).
The consultants have been appointed for an initial five year period covering AMP8, which runs from 2025 to 2030, with the option to extend to AMP9, which starts in 2030 and runs through to 2035.
The SST will support United Utilities’ major capital works.
A United Utilities spokesperson added: “Jacobs, with RHDHV and Chandlers as strategic sub-consultants, will drive catchment, asset optimisation and innovation into the options selection and preferred solution development delivery phase of the non-infrastructure (process) capital programme.
“Tetra Tech/RPS who have GHD and ICS as strategic sub-consultants, will drive catchment, asset optimisation and innovation into United Utilities’ programme to improve river quality.”
Jacobs has supported United Utilities on the current engineering services framework for the past 10 years, working together to ensure the resilience of critical assets such as the Haweswater Aqueduct.
Jacobs senior vice president Kate Kenny said: “This appointment extends our long-term relationship with United Utilities to more than 20 years, reinforcing our position as their trusted advisor.
“Taking a program level, holistic approach to asset base optimisation is critical to challenging norms and devising strategic water solutions to deliver customer and environmental benefits in the North West of England.”
As part of its PR24 business plans – submitted to Ofwat in October 2023 – United Utilities laid out total expenditure of £13.7 billion over the five years to 2030 with bills to jump 14% from £455 to £518.
To ensure billpayers are supported, the company will dedicate £525 million to customers who are financially struggling. This will encompass one in six households, the company said.
The firm’s totex spend is dominated by environmental programmes, specifically the water industry national investment programme (WINEP) with the company saying it will need to spend £5.7 billion to meet statutory requirements. At the previous price review, the company’s final determination stipulated a spend of £5.5 billion, including £663 million on the WINEP.
Within the WINEP, there will be £3.1 billion dedicated to addressing storm overflows.
United Utilities said its plan will drive significant RCV growth at 8.7% per annum, which equates to over 50% nominal across the period. UU is currently geared at 58%, which it said offers flexibility to finance the full plan over the AMP with 65% gearing – based on Ofwat’s weighted average cost of capital assumptions and without assuming any new equity.
The company’s proposed performance commitments include:
- Lowering leakage by a further 13% on the path to halving leaks by 2050
- Reducing storm overflow spills by 26.8% over the five years and working towards no more than 10% overflow by 2050
- Removing another 21% of phosphorous from waterways, which exceeds permit requirements
- Cutting per capita consumption by 4.5%
- To achieve top five positions for customer, developer and business retail customer experience satisfaction measures
- To remove 30,000 lead pipes from customer homes
- To roll out 900,000 smart water meters
The company’s spend breakdown proposes £350 million on novel water resources and protecting existing supplies as well as £1 billion on network resilience and replacing 950km of aging pipes.
Building on work undertaken in the current asset management period (AMP7), the firm will continue to utilise direct procurement for customers (DPC) to fund larger projects such as the Hawethorne Aqueduct scheme. Across AMP 8 and 9 it will spend £613 million through DPC in addition to the aqueduct.
Resilience spending will be £975 million including to separate rainwater from sewers for flooding resilience and £280 million through the advanced WINEP on managing surface water, which was highlighted as a priority by the National Infrastructure Commission (NIC) as a significant threat to be managed.