The European Investment Bank (EIB) has agreed to provide a £500 million ($709.6 million; €628.3 million) loan to United Utilities, a water utility serving seven million people in North West England.
According to a recent EIB statement, the loan will go towards financing improvements to the region’s water and wastewater networks, improvements that are part of United Utilities’ £3.5 billion capital investment programme for the 2015-2020 regulatory period.
The loan will be disbursed in two parts. The agreement for the first £250 million was signed last week, while the second tranche will be signed as United Utilities’ capital improvement programme progresses, according to the statement.
The projects being supported by the EIB's 18-year loan include a proposed pipeline to link West Cumbria to Thirlmere and the rest of the regional water network; increasing Blackpool’s sewer network capacity and reducing the impact of storm overflows; upgrading and replacing half of the treatment process at United Utilities’ largest wastewater treatment plant in Davyhulme; and installing water meters.
“In 2015-2020 we are delivering an investment programme of around £3.5 billion for the benefit of customers, the environment and to improve our ability to cope with climate change,” said Russ Houlden, United Utilities’ chief financial officer. “We aim to do this at the lowest sustainable cost possible in order to keep bills down and this low cost funding from the EIB helps us to give our customers excellent value for the bills they pay.”
It's not the first time EIB backs United Utilities. According to the press release, previous loans from the bank have supported the utility company’s projects over the past five years, such as the completion of a £200 million extension to Liverpool wastewater treatment works, the West East Link water pipeline between Liverpool and Bury and the SBAP sludge recycling centre in Manchester. Overall, EIB has provided £2.25 billion to United Utilities in the past 12 years.