Sunset clause to be axed from Specified Infrastructure Projects regulations

Water minister, Rebecca Pow, in the Commons, and Lord Goldsmith of Richmond in the Lords, last week secured agreement to remove a sunset clause from the regulations that provide for outsourced large infrastructure projects like the Thames Tideway Tunnel.

Parliamentarians agreed to the draft Water Industry (Specified Infrastructure Projects) (English Undertakers) (Amendment) Regulations 2020, which were laid before the House on 28 April.

This was a simple amendment to the Water Industry (Specified Infrastructure Projects) (English Undertakers) Regulations 2013 to remove the sunsetting provision, allowing the 2013 regulations to continue in force rather than expire on 27 June 2020.

The 2013 regulations enable the Secretary of State or Ofwat to specify, by notice, an infrastructure project where either is satisfied that two conditions have been met. The first is that the infrastructure project is of a size or complexity that threatens an undertaker’s ability to provide services to its customers. The second is that specifying the project would likely result in better value for money than if the project was not so specified, taking into account charges to customers and any government financial assistance. Once specified, an undertaker is required to put the infrastructure project out to tender and a separate Ofwat regulated infrastructure provider is then designated to finance and deliver the project.

Pow (pictured) said: “Currently, the only project regulated under the 2013 regulations is the Thames Tideway Tunnel…However, Ofwat has identified four large or complex water infrastructure projects currently in development that may benefit from being specified in accordance with the 2013 regulations over the next 10 years… They are the south-east strategic reservoir at Abingdon, a joint project proposed by Thames Water; the London effluent re-use scheme, a project proposed by Thames Water; the south Lincolnshire reservoir, a joint project proposed by Anglian Water and Affinity Water; and the River Severn to River Thames transfer, a joint project proposed by Thames Water, Severn Trent Water and United Utilities.”