Energy & Utilities

Last-mile water

The water and wastewater pipes between the public network and the home, the connection assets inside new developments, precincts and growing cities. Not a big-RAB network but a connections business (a NAV): build and adopt the network, then earn a regulated charge on every connection, for decades. Pick a real operator below and follow it through the development, the model and a working returns model.

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In focus · —
Example

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Drag the sliders to see what earns the money, the count of connections, the regulated charge on each, and how fully the development has filled, not the water volume.

150k
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Connections
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Live & earning
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Use-of-system
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recurring revenue p.a.
EBITDA p.a.
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What it is & how it works

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How it earns

Model A · the connections annuity

A regulated charge on every water connection

Last-mile water is the connection layer, the mains, sewers and connection assets between the public water and wastewater network and the home. The business is unusual and attractive: the developer typically funds most of the build (through connection charges or a contribution), so the operator's net capital per connection is small. In return it earns a recurring, regulated per-connection charge on every plot, often capped at the incumbent's level and indexed to inflation, for the life of the asset. The engine is therefore the count of connections and how fast they fill, not how much water flows. It scales: every new development, precinct or district adopted adds another long, indexed annuity at very little net capital.

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What it costs, and how it's financed

Revenue → operating costs → EBITDAMargin —

The capital, net of contributions
Who funds the buildallocation

    History & framework · key milestones
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      Cash flows & returns

      Build & contributions

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      Revenue regime & tax

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      Financing & hold

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      Unlevered IRR
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      asset / project return
      Levered IRR
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      return to equity
      Equity multiple
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      MOIC over hold
      Payback
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      project, undiscounted
      Cash-flow profile, equity■ invested   ■ returned
      Show the year-by-year schedule
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      What drives the return

        See also Water & wastewater, the regulated network the last mile connects to, and the Cash-flow & DCF model.