Water - Delivery Assurance Group (DAG) report: quarter 3 - 2022 to 2023

5. Overall Project Progress Wastewater Portfolio

The Wastewater Portfolio comprises 3 sub portfolios: SR15 Completion; Wastewater Treatment; and Wastewater Network. Detail on progress can be found in Appendix B. At Q3 performance in the Wastewater portfolio is outside the forecast range (Figure 9). 194 points have been achieved to date compared with a target range of 213 - 266. The Gate 100 Acceptance milestone continues to be challenging due to risks being realised. The overall performance has been impacted by commercial arrangements we have in place with one of our Alliances however we anticipate that this will be recovered by year end.

SOS

Performance on the Start on Site milestone (Figure 10) remains strong. 36 projects have now started on site, 7 of these in Q3.

Acceptance

14 projects achieved acceptance in Q3, delivering benefit to customers and bringing the total to 91 projects that have achieved acceptance against a forecast range of 112-121 at the time of commitment.

In the SR15 Completion sub-programme, the acceptance of 8 projects have been reforecast. 4 of these are now substantially complete and forecasting acceptance in Q4.

Reasons for reforecasting:

• 4 projects (Londornoch WTW Sludge Lagoon Upgrade, Craigneuk Avenue Airdrie, Craiglieth Rd Edinburgh and Townhead St Stonehouse) due to construction risks being realised.
• 4 projects (Scotwood Overflow, Wellgate Larnark, Main St Newtonmore and UID Cambuslang Road Richmond Laundry) due to third party delays.

In the Wastewater Network sub-programme, the delivery of 9 projects have been reforecast. 5 of these projects are now substantially complete and forecasting acceptance in Q4 with a further 2 forecasting acceptance in Q1 2023/24.

Reasons for reforecasting:

• 5 projects (Bothwell Sewer Replacement, Infra-Kingdom Park, Dunfermline Wellwood Wastewater Infrastructure, CAS Compliance Improvements - Networks East & North, and Coalburn Road) due to third party issues with land, power supply and road access
• Construction risks have been realised for a further 3 projects
• Additional scope was identified for one additional project to allow the project to be delivered

The delivery of 11 projects in the Wastewater Treatment programme have also been reforecast. 5 of these projects are now substantially complete and forecasting acceptance in Q4 with a further 4 forecasting acceptance in Q1 2023/24.

Reasons for reforecasting:

• 5 of these due to third party issues (Canonbie WwTW - Upgrade Growth, Burrelton WwTW – Growth, HV Asset Replacement Shieldhall WWTW, Forres WWTW and Banchory WwTW - Growth)
• 4 are due to general construction risks being realised (Blairythan Terrace, Lochwinnoch WWTW Inlet Screw Pumps, Dalderse WWTW and Carstairs Village WWTW)
• 2 are due to additional scope being required to complete the project (Kinneil Kerse WWTW and Stewarton WWTW)

We continue to work to understand and learn from risks to improve the forecast and delivery of new projects. When committing to the delivery of a project we balance the likelihood of delay due to risks against setting an over-cautious target with the potential to lose focus on the need to drive delivery.

Financial Completion

Performance on the Gate 110 Financial Completion milestone (Figure 12) is behind target with all 3 sub-portfolios outwith the target range but forecast to recover at year end. 67 projects have now achieved Gate 110, 6 of these in Q3 2022/23. The performance on concluding Gate 110 Financial Completion has been impacted by commercial arrangements we have in place with one of our Alliances however we anticipate that this will be recovered by year end.