Experts and investors have criticised an assessment of the cost of temporarily renationalising Thames Water, claiming the reported figures are exaggerated. A report by advisory firm Teneo, commissioned by Thames Water for a court hearing on a £3bn emergency loan, suggested that the UK government could charge 9.5% interest to keep the utility operational during a special administration. This “market rate” was based on loans provided to the energy supplier Bulb in 2021, but critics argue that comparing Thames Water to Bulb is misleading due to their differing risk profiles.

Tim Whittaker, Research Director at EDHEC Infra & Private Assets, commented:

“Lending to Bulb was a “riskier” proposition than a regulated water company because the energy firm’s only “major asset was its customer book“.

“It [collapsed] during a time of significant energy market turmoil, with significant energy price risk that was difficult to hedge“.

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Access our research paper “Low Tide: What the Data Showed About Thames Water”.