Featured Sector: Utilities

High levels of investment have buoyed the level of utilities work in recent years, and the need to replace ageing power stations and meet renewable energy targets will ensure a continued flow of funds into the sector. The value of underlying project starts more than doubled between 2007 and 2011. Underlying starts slipped back during 2012 as the flow of projects dipped from the 2011 peak, but have subsequently remained firm, standing substantially above the levels seen in any year bar 2011.

Despite falling starts over the first half of 2013, the full year saw a return to growth in underlying utilities projects, the value of which rose by 3% over the year. New activity has accelerated, with starts in the final quarter of 2014 34% higher than a year earlier.

Energy related work is expected to remain a strong potential growth area. The UK is in need of investment into new power generating capacity over the next 5 years, in order to plug the impending supply gaps as aging, inefficient and carbon emitting power stations close. In addition significant investment is required to upgrade the nation’s distribution networks and connect new generating capacity to the grid. However to date the flow of renewable energy projects has not responded emphatically to the new subsidy regime unveiled by the government at the turn of the year. The majority of major power generation projects currently procured or on site are those to produce energy from waste and biomass.