Ms Geraldine Tallon:

It is costly to meet the wastewater treatment standards that must be implemented. It is costly to maintain water quality and is costly to provide drinking water of sufficient quality to meet the drinking water quality standards. Irrespective of whether it is a DBO or a local authority contract, a significant operational cost is involved. From the perspective of a DBO, we have found that we have 20-year operational contracts. These are contracts that do not allow for review or cost increase, other than by way of consumer price index, CPI, over the period of the contract. Given that a contractor knows, when going into a DBO, that it must operate the contract for a 20-year period, there is a very large incentive from the outset to be highly efficient in respect of design, as well as with regard to the type of treatment and the plant operation. Consequently, an inherent efficiency is built in to the operational cost contracts for DBOs.