Featured Sector: Utilities

Underlying value of construction projects starting on site. (Excludes individual projects of more than £100 million and framework agreements).

Government policies and regulatory requirements have provided strong investment incentives over the last few years. In the energy sub-sector renewable energy projects have become more common, and have provided an increasing amount of work around the UK. In addition, both the water utilities and several major UK ports have moved forward with strong investment programmes.

High levels of investment have buoyed the level of sector activity: The underlying value of project starts rose consistently between 2006 and 2011, while construction output also increased.

However in contrast to this positive longer term trend, a number of factors are currently restraining the flow of project starts; including uncertainty over the funding regime for renewables. Water companies are also nearing the end of their five year investment cycle. These factors contributed to a 15% decline in the value of underlying project last year and we anticipate the flow of work starting on site will remain flat over the next two years.