Ofwat has agreed an increase of c £6 million in additional gate C development funding for the Poole Water Recycling and Transfer scheme. The solution owners, South West Water and Wessex Water, submitted their gate three reports and proposals on 30 January 2026 for assessment.

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Development funding is the allowance agreed by Ofwat in the price review process to enable companies to fund the efficient solution development costs, and where appropriate the cost of developing the solution for competitive delivery, pre-construction.

Ofwat's decisions in the gated process are only about whether companies should continue to receive funding to investigate and develop solutions. Ofwat does not decide if the solutions should go ahead.

The Poole Water Recycling and Transfer project will be putting up to 30 megalitres per day (Ml/d) of recycled water into the River Stour during a typical summer, and abstracting up to 25Ml/d of river water, allowing for losses in the treatment process and the natural environment, at Longham Lakes to supply Alderney Water Treatment Works (WTW).

The solution proposes to recycle treated water from the existing Poole Water Recycling Centre (WRC) at a proposed WRC at Corfe Mullen which will use advanced treatment technology. The water will be transferred to the new WRC by a new high lift pump station (HLPS). Here, flow will be buffered in large storage tanks, before being passed through a series of advanced membranes, adsorption and chemical free disinfection technologies. Once further treatment is complete, a pump station will convey flow to the River Stour through two new rising mains and outfalls:

The project is expected to be operational in 2035, providing a maximum peak yield of 25 Ml/d, with an annual average water available for use benefit of up to 12.5 Ml/d to the Bournemouth Water Resource Zone.

Ofwat’s draft decision document agrees that there is value in accelerating the solution’s development to construction ready in 2025- 2030 - a solution is required to address the Bournemouth supply-demand deficit by 2035. Continued funding is required to develop a solution to be delivered in time for the planned construction ready date.

In the 2019 price review process, Ofwat determined an expenditure allowance of up to £1.9 million (2017/18 prices) for the scheme to support development activities for gate four, covering the period to 31 March 2025.

However, the Poole Water Recycling and Transfer did not reach gate four within the PR19 period and the gate four allowances were reassessed as part of the price review 2024 process. In the PR24 final determinations, Ofwat allowed up to £10.96 million (2022/23 prices) to complete gate four activities in the period 1 April 2025 to 31 March 20306.

The regulator has now considered the updated development expenditure template submitted by the solution owners as part of the gate three submission. The owners have requested a new allowance of £16.96 million (2022/23 prices) - an increase of £5.999 million - for gate four activities which covers:

• additional programme costs

• design and site investigations for the pipeline to the secondary discharge point

• ground investigation for all pipeline routes

• increased requirements for environmental surveys

• stakeholder engagement and

• contingency for risks. This is an increase of £5.999 million when compared to the PR24 baseline gate four allowance of £10.961 million seen in table 3.

Ofwat’s draft decision document says the regulator is proposing to approve the requested additional funding allowance and incorporate this into the new gate C allowance, subject to the proposal remaining unchanged under the new combined process.

The solution owners and other interested parties can now respond to the draft decision. Representations are invited by email to This e-mail address is being protected from spambots. You need JavaScript enabled to view it or by completing a Microsoft Teams form. The representation period will close at 6pm on 25 June 2026. Ofwat’s current aim is to publish the final decision at 10am on 18 August 2026.

Click here to download the draft decision document

Click here to access the online response form