The project

The Thames Tideway Tunnel (TTT) represents a unique UK infrastructure investment opportunity. This major engineering project that encompasses the design, construction, financing, ownership and operation of a 7.2m diameter, 25km tunnel that runs up to 65 metres below the river Thames in London. It is the largest single asset in the UK water sector. DIF has invested in the project as part of a consortium together with Allianz Capital Partners, Amber Infrastructure and Dalmore Capital.

Status
Construction
Investment date
August 2015
Country
United Kingdom
Fund
DIF III & IV
People collected at river walkway
7.2m
Diameter
25km
Tunnel
9m
Customers
11%
Equity stake

The tunnel will cost £3.8 billion to complete, and an additional £1.1 billion has already been spent by Thames Water on preparatory works. Construction began in 2016 and will be completed in 2024. Full operations will then commence in 2028, after an extended testing period. Once finished, the tunnel will incorporate a number of sewage inflow points and connect to the largest sewage treatment works in Europe. While TTT is designed to stop the discharge of untreated sewage into the River Thames, it will also significantly increase capacity of the outdated London sewer network that covers nine million customers and will result in a significant improvement in the water quality of the Thames.

This cost is being paid for by Thames Water’s 15 million wastewater customers through their bills, which will rise by no more than £25 per year. Innovative debt finance was provided by six major banks and the project includes state-of-the-art construction technology. The project benefits from a bespoke regulatory framework that allowed it to start generating RPI-linked revenue as soon as construction began.