6 days ago
Cost of first reservoir in 30 years trebles to up to £7.5bn
Troubled Thames Water is to warn that the cost of a new reservoir in Oxfordshire has rocketed to as much as £7.5bn, more than three times the previous estimate.
In an announcement expected as soon as Thursday, Thames will blame soaring construction costs at the site near Abingdon for busting the £2.2bn budget. So far only preliminary engineering works have been undertaken.
The extra burden is expected to be piled onto households, which are already facing a 35pc increase in water bills over the next five years. The reservoir's costs are due to be recovered from Thames Water's 15 million customers across London and the South East.
Thames Water is pressing ahead with plans to build one of Britain's first reservoirs in 30 years after Rachel Reeves threw her weight behind the project earlier this year.
The Chancellor vowed to take on the 'blockers' as she pledged nine new reservoirs across the UK, including Abingdon, which will be capable of holding 150 billion litres of water in an area the size of Gatwick Airport.
In its latest assessment, Thames will warn ministers that the project will cost between £5.5bn and £7.5bn, up from earlier estimates of £2.2bn.
The overrun will cast fresh doubt on Britain's ability to deliver major projects, with HS2 and Hinkley Point C already expected years late and tens of billions of pounds over-budget.
