Bioresources - Setting a Standardised Methodology for Quantifying Cost of Sludge Liquor Treatment

Scope of project and overall objectives There are four key elements of the project that the Supplier will be expected to deliver. These are: - initial findings on potential options for standardisation; - a draft report; - a presentation to the industry on the draft report; and - a publishable final report. Initial findings on potential options for standardisation (by c.7 Oct) The Supplier will be required to present its initial view on potential options for a standardised methodology for sludge liquor treatment costs to Ofwat. This will be in a form sufficient for Ofwat to gain an understanding of the likely recommendations of the draft report. Draft report (by c.21 Oct) The draft report must: - Assess how the WASCs are currently accounting for the costs of sludge liquor treatment. This will include looking at the operational procedures the WASCs follow, the measurements and estimation methodologies used to equate liquor volumes/concentrations to costs, the confidence WASCs have over the data they use, how accurately these costs are recharged to the bioresources control and how WASCs allocate any common costs between liquor treatment and other activities. - Propose options for the future treatment of these costs that could be included with Ofwat's RAGs. The Supplier will need to propose options for a standardised methodology for quantifying sludge liquor treatment costs that can be followed by all WASCs without them incurring excessive additional costs ...ulate their APRs. The Supplier must also indicate a favoured option. There is no explicit criteria provided by Ofwat to base the option assessment on, however the Supplier should refer to Ofwat's statutory duties, with which any action taken by Ofwat must be consistent with. The Supplier should also consider how well aligned any favoured option is to the current trade effluent charging guidance , which encompasses a similar issue in wholesale water. The Supplier should ultimately come to its own view of a favoured option, however as part of the process it will need to engage with WASCs and should therefore consider any evidence they provide. - Anything else the Supplier identifies that is not listed above to be agreed in advance. Presentation on draft report (by c.23 Oct) The Supplier will be required to give a presentation on the findings of the draft report and explain the proposed options for future treatment of the sludge liquor costs. The Supplier will also consider comments from the WASCs on the presentation and feed these into the final report. The Supplier will be responsible for the logistics of the presentation (e.g. technology, meeting invites etc), however Ofwat will be able to assist with suitable WASC contacts if needed. The presentation should be no longer than half a day. Final report (by c. 6 Nov) The publishable final report will have the same requirements as that of the draft report, but must also reflect comments from the WASCs and Ofwat.