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Guernsey Water’s customer bills should not be impacted by a loan from the States Bond to part fund the replacement of the Belle Greve wastewater outfalls.
Funding has now been agreed to enable the utility to repay the £18.6 million funding that it received from the States’ capital reserve for the project in 2015. £9 million of the repayment has come from a loan from the States of Guernsey Bond, with the remainder funded from Guernsey Water’s cash reserves.
General manager Stephen Langlois said it intended to fund the capital repayments and interest on the borrowing through targeted efficiency savings. This would mean Guernsey Water can continue to keep customers’ bills as low as possible.
He said borrowing an element of the funding also meant that future customers would be contributing towards the investment in the outfalls.
In the budget debate in November 2016, States Members agreed retrospectively that the project should be self-funded by Guernsey Water, instead of from the capital reserve.
Mr Langlois said that Guernsey Water, as part of the States of Guernsey, had considered various options for borrowing but funding from the bond provided greater long term certainty and best value for money for customers.
“We have a business plan that identifies our capital investment programme and funding requirements. We are committed to delivering our plan and improving the service we provide whilst continuing to keep our customers’ bills as low as possible,” he said.
“That does rely on us achieving ongoing efficiency savings and we are progressing initiatives that will help us deliver those.”
“Such efficiencies can also reduce any future borrowing, which is now an important focus for our business. That will allow greater flexibility to reinvest in services, keep bills as low as possible and, as long as they are sustainable and fair to customers, make returns to the States, particularly if we can improve performance beyond our targeted efficiencies.”
