LONDON: Members of Thames Water Utilities' board will hold a final consultation this week to update its business plan after shareholders branded the previous plan “uninvestable”. It's planned.
Board members of the heavily indebted power company will meet tomorrow and the plan is expected to be announced on Friday, said a person familiar with the plan, who asked not to be identified discussing private matters.
A spokeswoman for Thames Water declined to comment.
The River Thames supplies a quarter of England's water and wastewater services, including London.
The company is rushing to raise at least 2.5 billion pounds (about $3.1 billion) in equity capital after parent company Kemble Water Holdings last month refused to inject more capital into the business.
The River Thames needs cash to rebuild, repair chronic leaks and sewage spills and develop new supply in the face of worsening droughts due to climate change.
But investors said overly restrictive regulations by industry watchdog Ofwat made funding impossible.
Kemble, which derives all of its income from Thames Water dividends, defaulted a week after refusing to make further payments.
When Thames Water announced its new five-year business plan in October, the water utility said it wanted to increase its bills by 40% to fund an investment program totaling £18.7bn.
These numbers may be revised upward as the company strives to comply with new environmental protection rules set by the government.
The plans are being scrutinized by Ofwat. The draft decision will be published on June 12th.
Other water companies have increased their expected capital expenditures and customer bills following consultation with Ofwat and the government.
Southern Water Services, which is also underperforming, raised its expected spending by 8.5% in March, saying customers would now be paying an average of £727 a year in their bills by 2030, compared to an October forecast of £681. Ta. — Bloomberg
