NORTHUMBRIAN Water stands to gain a £600,000-a-year windfall from the Redcar steelmaking plant once it is up and running again this autumn.
The news comes as the utilities firm announced a solid performance in its annual results today.
The steel plant was an important source of income for Northumbrian Water before it was mothballed last year, discharging effluent to the firm’s £33m waste-to-energy treatment facility at Bran Sands.
Northumbrian Water chief executive officer Heidi Mottram, who took over from former CEO John Cuthbert last year, said: “We were really pleased when the deal was secured.
“It will make a little bit of difference to us but clearly the big story is that it’s going to bring employment benefits to Teesside. For us as a company, it will be worth somewhere in the region of £600,000 a year.”
That will be a welcome bonus for the company, which had taken a financial hit when the plant was mothballed last year.
Despite this, Northumbrian Water delivered a strong financial performance in the year to March 31.
Revenues were up 4.7% to £738.1m while pre-tax profits rose to £181m from £170.2m the previous year.
The increases were due to a robust performance by the core water business, which saw revenues rise from £657.8m to £689.4m, and a £40m windfall from water and waste water contracts in Scotland, Ireland and Gibraltar.
Ms Mottram said: “It’s a very solid set of results. We will continue to deliver value to our stakeholders by focusing on our core competencies in water and waste water management. I’m pleased with the progress we have made this year towards achieving that goal.”
She said she was keeping a close eye on regulatory changes that could drive up costs for water firms and prices for consumers.
Later this year the Government is due to publish a White Paper on the Natural Environment and another specifically on water which will cover charging, metering and competition.
It is also keeping a watchful eye on Government plans to transfer certain private drains and sewers into the ownership of water companies.
The firm predicts the move will ramp up its costs by £20m and plans to make that up by hiking prices.
Ms Mottram remained tight-lipped over the new tariffs but said the company could create up to 80 jobs to cope with extra work maintaining drains and sewers.