In the 19th century Sir Joseph Bazalgette built a sewerage network for London with the capacity that he believed would meet all foreseeable needs. It has been updated and modernised but for some years has been coming under increased strain to the point that combined sewer overflows discharge raw sewage into the River Thames on around 50 occasions a year.
This figure is expected to increase. Recent Thames Water work has shown that the system is operating closer to its maximum capacity than previously recognised and, with population growth, increasing urbanisation and climate change, it is estimated that in 10 to 20 years time sewage will be overflowing into the Thames even when there is little rain.
Complete eradication of some spills of sewage into the Thames during periods of heavy rainfall is not feasible: this is the legacy of a sewerage system which carries both foul water and rainwater. But the frequency and volume of spills we face in future is unacceptable and should be reduced to ensure that environmental standards in the Thames continue to meet the standards set by the Urban Waste Water Treatment (England and Wales) Regulations 1994.
Since the 22nd March 2007 statement by the then Minister for Climate Change and the Environment and Member for Dudley, South (Ian Pearson), on the need to improve the water quality in the Thames by upgrading the sewerage infrastructure, Thames Water have started work on building a tunnel (known as the Lee tunnel) from Abbey Mills pumping station to an upgraded Beckton sewage treatment works at a total cost of around £0.8 billion. When complete these works should reduce the total volume of sewage overflows into the tidal Thames by around two thirds. However significant volumes of raw sewage will still continue to enter the Thames at times of heavy rainfall particularly in the higher reaches of the tidal Thames from Hammersmith through central London which will get less benefit from the Lee tunnel.
Mr Pearson's statement supported the construction of a second "Thames Tunnel" to address unsatisfactory overflows from Hammersmith to Beckton. Since 2007 Thames Water, the Environment Agency, and Ofwat have worked together to improve the evidence base, to take forward the design process including costings, and explore possible commercial arrangements. The then Government announced their intention to go forward with the scheme. Despite that the European Commission has continued to pursue infractions proceedings against us claiming we are failing to meet our obligations under the urban waste water treatment directive in the London area, and in Whitburn in the North East of England.
In 2007 the then Government judged the cost of the scheme to be at least £2 billion, with a peak annual increase in bills for Thames Water customers of £37. Since then greater analysis and study by Thames Water have led to a revised estimate of £3.6 billion, including contingency costs but excluding the Lee tunnel and other elements of the scheme which have already been contracted for. This could result in future peak annual bill increases of around £60-65 (£80-90 including the Lee tunnel and other elements).
I recognise that in the current economic context this represents a significant cost to Thames Water customers and, while we judge this to be a robust cost estimate for this stage of the process we cannot rule out further changes to the estimates as work progresses. However a Thames Tunnel continues to offer (by far) the lowest cost solution to the problem and I believe Thames Water should continue to press forward with this project working with Ofwat, the Environment Agency and DEFRA on the regulatory, commercial and planning processes. Thames Water intend to consult on options for the route of the tunnel shortly. We with Ofwat will continue to ensure that the costs are scrutinised and reviewed so that I can be assured before Thames Water sign a construction contract that the final proposal represents proper value for money. As we go through this process, I intend to update the 2007 impact assessment for the tunnel and place it on the DEFRA website.
I am also minded that development consent for the project should be dealt with under the regime for nationally significant infrastructure projects established by the Planning Act 2008. I consider that this project, with its unique scale and complexity, is of national significance, and therefore appropriate for this regime.
I will be considering the appropriate mechanism under the 2008 Act to ensure the Thames tunnel project is considered under this national level regime and intend to include consideration of the Thames tunnel in the draft national policy statement for waste water. I plan to lay this before both Houses of Parliament later this autumn.