Subscribe
Share
Share
Embed
Welcome to The Executive Exchange, a premier podcast series for on-the-go senior executives. Each episode features short, impactful podcasts where industry leaders share key insights and experiences from the water industry.
[00:00:00] Piers Clark: Welcome to the Exec Exchange 15 minute podcast, in which a leader from the water sector shares a story to inspire, inform, and educate other water sector leaders across the globe.
[00:00:10] Piers Clark: My name is Piers Clark and my guest today is Matthew Parr, deputy CEO at Tideway, and we're gonna be talking about the super sewer project that has been under construction for the last 10 years in London and how it's going to shape that global city.
[00:00:27] Piers Clark: Matthew, it's wonderful to have you with us today.
[00:00:30] Matthew Parr: Thank you, Piers. Great to be here.
[00:00:31] Piers Clark: Now we always start by getting to know a little bit more about our podcasters. So, can you give me the potted history as to how you got into the role that you are into today?
[00:00:40] Matthew Parr: Well, I've been involved in the infrastructure and water sector for 30 years. But if I roll back to the beginning, , I spent a lot of time either in the water or on the water. My first degree was in geography. My second degree was master's in water engineering.
[00:00:53] Matthew Parr: From there, actually I went to Ofwat who are the economic regulator of the water sector in England and Wales. And then left Ofwat in 2000 and spent the next sort of 10 plus years as a management consultant. A lot of that work was sort of strategy regulation. So most of my time then, probably 60% or 70%, were still in the water sector. The rest was covering transport and energy and telecoms, and a bit of healthcare as well.
[00:01:20] Matthew Parr: And then in 2011, I got a phone call from somebody who's working on the early days of Tideway to see whether I could come and help out for a few days a week for a couple of months.
[00:01:30] Piers Clark: So, initially as a consultant?
[00:01:32] Matthew Parr: Yeah , Initially as a consultant .
[00:01:34] Piers Clark: I love it. They call you in as a consultant and they make you stick around to deliver whatever it is you've told them they can do.
[00:01:40] Matthew Parr: Well, it was the best phone call I ever got. So, I'm still here 15 years later.
[00:01:45] Piers Clark: Now at that time I was also at Thames Water, and we'll talk in a minute about the relationship between Tideway and Thames Water, but I was part of the birthing of the Tideway project.
[00:01:56] Piers Clark: So, now let's talk about what is Tideway?
[00:01:59] Matthew Parr: Okay, so Tideway, we're the company that was set up to do the detailed design and construction of a super sewer that runs under the River Thames, and then commissioning the tunnel too.
[00:02:10] Matthew Parr: So, our main tunnel is 16 miles long, running from about 35 meters deep in the west of London to 66 meters deep in the east of London. And its role is effectively to intercept sewage that would otherwise go into the River Thames.
[00:02:24] Matthew Parr: Our tunnel actually then connects into another tunnel, which is called the Lee. And then ultimately the Lee Tunnel goes towards sewage treatment works where the sewage is then treated before clean water is discharged back into the river.
[00:02:37] Piers Clark: And when we talk about a super sewer, so you've got the depth of it there. Can we talk about the diameter?
[00:02:42] Matthew Parr: So , 16 miles long main tunnel. The internal diameter is 7.2 meters.
[00:02:49] Matthew Parr: What we often say is that's the width of three double decker buses.
[00:02:52] Piers Clark: Absolutely phenomenal.
[00:02:54] Piers Clark: I think we understand now why it's called a super sewer, but of course London wasn't a blank sheet of paper. London had lots of infrastructure already in place and that's part of the reason why this super sewer was needed.
[00:03:05] Piers Clark: So, can you just now fill in the background as to why did we suddenly get to the stage where we needed this massive sewer?
[00:03:11] Matthew Parr: People might know that in the 1860s that was the Great Stink of London. A lot of the tributaries of the River Thames were effectively treated as sewers at the time. And it got led to a problem where even the politicians at the Houses of Parliament said, actually, there needs to be a solution. And they turned to Sir Joseph Bazalgette, who built some interceptor sewers, both north and south the River Thames to alleviate the sewage problem. Those interceptor sewers just took the raw sewage to the east of London where it was discharged without treatment.
[00:03:43] Piers Clark: Now, that is exactly the story. It was moved down to the tidal zone where the tidal flushing would mean that the sewage would just basically get flushed into the North Sea.
[00:03:50] Piers Clark: And you're right, the city of London from 1800 to 1899 went from 1 million people to 6 million people. And that was this cause of turning the Thames into a open sewer.
[00:04:02] Piers Clark: So Bazalgette built that 150 years ago. He built these interceptor sewers, connecting up with the existing sewers there. But why did we need the new super sewer then?
[00:04:10] Matthew Parr: Sir Joseph Bazalgette, who's a bit of a hero for those people at Tideway. In fact, our formal company name is the Bazalgette Tunnel Limited. But we call ourselves Tideway. It is less of a mouthful.
[00:04:21] Matthew Parr: The population of London at the time was only 2 million and he built these interceptor sewers for a population with 4 million. But the issue now is the population, it is much bigger than that. It's north of 8 million and growing. So effectively there's a capacity issue in London.
[00:04:35] Matthew Parr: In London, we have combined sewers. So, it takes wastewater from houses together with rainwater. It could rain two millimeters and you'd get discharges from the sewers into the river. In 2006, the UK was failing the Urban Wastewater Treatment Directive in the Tidal River Thames because of this issue.
[00:04:53] Matthew Parr: And the solution was sort of three parts. The first was for Thames Water to increase the size of its sewage treatment works. The second part was the building of the Lee Tunnel, which I mentioned earlier. And the third and largest part was the building of the Tideway Tunnel, the 16 mile tunnel. And so once these three solutions have been put in place, well over 95% of the volume of sewage going to the river would be intercepted.
[00:05:17] Matthew Parr: And in particular, one of the challenges of a sewer network is what's called the first flush. It's particularly after a dry period of time, eventually there's a buildup of sewage in the sewer network. And if it's followed by a big heavy downpour then obviously that first flush could go right into the river. And it's pretty unpleasant.
[00:05:36] Matthew Parr: So, not only does it pick up a lot of the volume, but it also deals with that first flush. So even when the very large super sewer, in those unusual circumstances when the super sewer is full, the discharge points are still available. By then the sewage will be really diluted. So it's considered by government and the environment regulators that that was fine because there would be very limited harm to the environment with those spills.
[00:06:01] Piers Clark: Excellent. Now, let's talk about some numbers here. What about finances and how long it's taken to get through planning and construction?
[00:06:09] Matthew Parr: So I joined the project in 2011. We secured our Development Consent Order in 2014. And then the company was set up in 2015. Because of the scale of the project and the risk associated with tunneling under London, and all of the third party infrastructure, it was considered the right thing to do to set up a separate company to deliver this tunnel.
[00:06:30] Matthew Parr: We worked really hard in thinking about how risk was best allocated between different parties, and we decided that we needed a government support package. So, the government took those risks, which allowed us to attract typical investors in the infrastructure world.
[00:06:44] Piers Clark: Yeah. Without that, it just wouldn't have been bankable, would it?
[00:06:47] Matthew Parr: You couldn't have taken it to market and got the level of interest.
[00:06:50] Matthew Parr: So, effectively the solution was those high impact, low probability risks were taken by government, and that allowed us to go to the infrastructure type, pension type money, typically investors in utility and attract them to bid a cost of capital. So rather than a regulator assessing the cost of capital, which typically happens, actually, we'll ask the market what the cost of finance is gonna be.
[00:07:11] Matthew Parr: So the bidders with the lowest cost of finance were the ones who are gonna own the company and had to finance the company . We ran two procurements, one for financing, one for the delivery, and then we brought 'em together in 2015 to deliver the product.
[00:07:25] Piers Clark: And tell me, just because everyone thinks that Tideway is part of Thames or a sister company of Thames Water, what's the relationship between Thames Water and Tideway?
[00:07:35] Matthew Parr: So Tideway is a separate company with its own shareholders, its own board, its own management team. We have a license awarded by Ofwat, the regulator, so we're the first infrastructure provider. I say the first because the model's been considered to be a success. There are a number of projects in the water sector which are going to use the same model with the government support package .
[00:07:55] Piers Clark: Excellent. Now, where are you at in the scheme? You got your license to proceed in 2015.
[00:08:01] Piers Clark: Where are you now? 12 years on?
[00:08:03] Matthew Parr: We finished main construction and the system was fully activated in 2025. So that is activated in terms of all of the interceptions that would've gone into the river. And since then, we've intercepted over 19 million tons of sewage. So, that is the equivalent of over four and a half Wembley stadiums full to the roof of sewage.
[00:08:25] Matthew Parr: We are towards the end of commissioning. So we're testing the system in terms of different weather conditions. In terms of the scale of the project, the cost is 4.6 billion pounds. We are working through with Thames Water and our main works contractors and our system integrator. Those final issues that need to be resolved on any large project.
[00:08:44] Piers Clark: Now, the bit I'm pleasantly surprised at is that that figure 4.6 billion's obviously a huge number, but back in 2010, 11, 12, when I was at Thames Water, and we were talking about this as a concept, that was the sort of number that was being talked about as the budget. You often hear these stories of, well, it's five times the original budget. This scheme appears to have delivered on time and to the original budget, which is an incredible testament to the professionalism performance of the team that you've had working with you.
[00:09:17] Matthew Parr: That's right. In terms of cost and time, we're broadly within the original ranges that were set out at the beginning.
[00:09:23] Matthew Parr: One of the key issues is the impact on customers because customers fund this ultimately. And at the start, we estimated that the total cost of project would be between 20 and 25 pounds on the average customer bill. And today we're still well within that 20 to 25 bill range. In terms of a combined bill, it's probably less than 5%.
[00:09:44] Matthew Parr: Just reflecting back on the great work of Sir Joseph Bazalgette, his system still operates today. It was just a capacity issue. So when we design and build this tunnel, the minimum design life's 120 years. There is a long-term benefit for the river over many generations. And that's why, again, that ties back to how we pay for it, to the funding.
[00:10:05] Matthew Parr: A lot of the expenditure is upfront in the first 10, 12 years when you build the tunnel. But actually over the long term, the costs are very low. We'll obviously need to inspect it and maintain it, but that's really a small percentage compared to the upfront costs.
[00:10:18] Matthew Parr: This delivery model allows us to spread the cost of the project over a very long period of time. So I think it also addresses some intergenerational issues as well, because the benefit from this tunnel will be for decades and decades to come.
[00:10:32] Piers Clark: Okay. I've gotta ask, what do you know now that you wish you'd known at the beginning? And technology will inevitably have moved on in the 15 years. What things have come up that have created either challenges or opportunities?
[00:10:46] Matthew Parr: No major project is ever delivered without significant challenges.
[00:10:50] Matthew Parr: At Tideway, we set the project up in the right way, not only in terms of the structure, it's about getting the right people from the development phase and making sure that they're there for the delivery as well.
[00:11:01] Matthew Parr: But we also set out, right at the beginning, a vision for the project. We tried to make this much more than just a large engineering challenge. So we had a vision that it was reconnecting London and Londoners with the River Thames. And we also set out, back in 2013, a set of over 50 legacy commitments.
[00:11:19] Matthew Parr: One of the things I'm proudest of in my whole career is developing that legacy strategy from over 10 years ago. And effectively we set out those 50 commitments in terms of how can we deliver for the environment, how can we make sure that we can raise standards for health and safety and wellbeing, and what does it mean in terms of the people for place in the economy?
[00:11:39] Matthew Parr: So, we made those 50 commitments across those five categories. And we were transparent. We reported against progress all the way through. And then last year we effectively had a project closeout legacy document.
[00:11:50] Matthew Parr: We weren't perfect, but we delivered over 90% of our original commitments. So we really proud of the broader impact that we've had.
[00:11:57] Piers Clark: 90% is already excellent. You can definitely be proud of 90%. Now, how about your major challenges?
[00:12:04] Matthew Parr: So one of our challenges was COVID. We were absolutely in the middle of main construction during COVID and we do things safely or not at all, that's one of our mantras. And effectively we paused the project which was not easy to do given we were working across London in more than 20 sites, and we were working below ground.
[00:12:24] Matthew Parr: I think within a couple of weeks we'd close down all of our sites or pause all of our sites. There was one or two that we couldn't pause immediately because it would've been too dangerous to stop them. For example, we were tunneling under a river wall so we let the TBM go beyond the river or before we pause the work.
[00:12:39] Matthew Parr: And then we took the right processes to sort of reintroduce people back into the sites with obviously the protections that they needed in place because of the pandemic. And we did things the right way, but those decisions did cost the project 200 million pounds and it cost us six months on the program.
[00:12:54] Matthew Parr: Nevertheless, they were the right decisions to make.
[00:12:57] Piers Clark: You sound like you're speaking with a, "and I have no regrets about spending that money and creating that delay."
[00:13:02] Matthew Parr: Well, ultimately it was for the safety of our people, and that's the most important thing.
[00:13:07] Piers Clark: Right. Well, unfortunately we're running outta time.
[00:13:10] Piers Clark: And we do like to finish with a bit of a personal question, and I'd like to ask you to go back 20, 30, 40 years and what advice would you give a young Matthew Parr if you could go back in time?
[00:13:23] Matthew Parr: I think the first thing to say is you're on the right path because I picked something that I was really interested in. And all the way through I've had this sort of close thread to the water sector . It's so tied into our environment. It's such an important sector. So pleased that I've spent the last 30 years working in the sector with some great people.
[00:13:41] Matthew Parr: I think the second point might just be broaden your experience, look for opportunities, say yes. I think that some of the best experiences is when I've changed what I've been doing.
[00:13:52] Matthew Parr: Third I think is spot those people that you can learn from be cause you meet some really brilliant and talented people and just observe what they do, listen to them. You might be lucky enough that they might be a coach for you or a mentor.
[00:14:06] Piers Clark: You have been listening to the Exec Exchange with me Piers Clark, and my guest today has been Matthew Parr, the Deputy Chief Executive at the Tideway Project.
[00:14:14] Piers Clark: And we've been talking about the super sewer that is just coming to the final stages of its construction under this great city of London.
[00:14:23] Piers Clark: Thank you to our sponsors, and until next time, keep asking questions, keep sharing, and keep safe.