We're gonna get straight into it. You've had a chance, hopefully, to catch the video and all of the documents. We'll just go straight into Q&A, if that works for everybody. Brilliant. Straight in. Pavan, thank you very much. Straight to you. Hi, guys. Good morning, and thank you for taking my questions. I have three, please, if I may. Firstly, can you talk us through the impact of recent macro moves and sort of equity markets on your pension position? Should we expect the deficit today to be higher than the GBP 128 million that you reported? Secondly, clearly the push for a windfall tax has increased over the past few weeks, you know, focused on oil and gas and more recently, electricity generation. I was just wondering what your thinking was on any potential risk of a windfall tax on U.K. water companies, given that elevated inflation will be feeding into our RCV and feeding into bills from April of next year. Finally, on a related note, can you talk us through what you're doing to help customers through this sort of cost of living crisis, and have you seen any impact on collections or bad debts yet? Thank you. Brilliant. Thank you, Pav. Three brilliant questions. I'll take number one. I'm gonna hand number three to Jude in a second, both parts of, and James will be desperate to get to pensions. It's his favorite topic. In terms of the windfall tax, I mean, I think it's very, very different when you cross compare energy to water. You know, we've got a five-year revenue situation in terms of revenue cap, so it's not like we can suddenly make excess money in this period of time. Yes, we have inflation on the revenue, but I guess, as Helen will happily talk about later, we've also got significant cost pressures coming through in terms of the capital program or our day-to-day procurement. I think from a U.K. Government perspective, I'm sure they'd look at the results from the last year of the sector, and don't forget, only three of the 17 companies actually made above the base return. That's a fundamentally different position to what you're seeing in the energy market. I just think batching all utilities together in this windfall tax conversation, I think it's the kind of thing that just, you know, you might read about in the press. I don't believe that Treasury or yourselves, as utilities analysts, would have that same perspective, that you're talking apples to apples. I think it's a very, very different climate. James, pensions. Yeah. Thanks, Pavan. On pensions, the short answer is no. If I ran the numbers today, you wouldn't see a significantly increased pension deficit. In fact, it may actually be lower. And that's because we, you know, we run a very, you know, effective hedging management strategy. And as that deficit has come down, what we've looked to do is reduce the volatility going forwards by actually increasing the level of hedging assets. Our assets very much reflect the impact of those macroeconomic events on liabilities. Yeah, short answer is no. Very good. Jude, over to the two parts on cost of living. Okay, yes. Thanks for that question. Of course, you'll have seen that we're launching our new affordability scheme today. We're intending to help another 100,000 customers by discounting their bill through a social tariff. We are beginning to hear more from our customers in terms of their needs, so we think this is the right time. We've also, as a sector, committed to eradicating water poverty, so we wanna get a head start on that. With regards to bad debt, we haven't seen an impact from the current cost of living crisis just yet. Of course, we are, you know, tracking all of our leading indicators in that space to try and make sure that we get ahead of any changes, little bit like the work that we did during COVID. We think that we've got the right bad debt journeys in place to intervene early, and the affordability scheme actually is a really good lever to intervene early also. Very good. Does that answer all the questions then, Pav? All very clear. Thank you very much, guys. Very good. Moving to Mark, I think your hand was up next. Hey. No, thank you for taking my questions. Just firstly, on bad debt provisions, I mean, clearly you didn't use what you provided for over the last couple of years, hence the release. Given the coming cost of living crisis, how wise do you think it is to release provision now? And do you envisage a situation where you'd have to put the provision back on or increase provisions later this year? Is that driven more by technical accounting than, you know? Cause any finance director would rather leave the provision there, right? Just secondly, regarding supply chain, can you talk about the general, aside from power and chemicals, like, general cost pressure, what it's running at, and also the availability of resources? Because pricing is one thing, but as we've heard recently, getting materials to site in some cases is very difficult. Very good. I'll hand to James for the bad debt provisions, and I quite liked your analogy of no FD likes to release money. That entertained me. I'll hand to Helen to talk about supply chain and availability. Yeah. Thanks, Mark. I think when you step back and look at how we've performed on bad debt, I think we've got a really good story. We've been through a couple of you know really tricky years with COVID. You will have seen last year that we sort of you know we set aside about GBP 12 million in anticipation of higher unemployment that would you know the concern was that would feed through in our customers' ability to keep up with their bills. Thankfully, we haven't seen that. Actually cash collections from our customers has remained healthy. I think we've got one of the lowest bad debt charges in the sector, which I think is a really good place to be going into, what you've rightly pointed out as coming into a period which, you know, will be difficult for some of our customers, particularly those who, you know, are on a lower income and are gonna struggle to pay. That's why I haven't released all of that COVID provision. I've effectively repurposed it. There's still GBP 8 million on the balance sheet as a provision that's in excess of our ordinary bad debt allowance, if you will, for precisely that reason. That I feel we're well-insulated going into this new period of higher inflation. Of course, the additional work that we're doing on affordability, I think will also help to make sure that our customers can continue to pay their bills. Very good. Helen, supply chain. Yes. There's no doubt it's tough out there at the moment, and, particularly in construction, as you say, with materials. We've done a lot over the last 2-3 years, which puts us in a really great position, in terms of supply chain availability. You'll remember that we broadened our supply chain base, at the start of the AMP. We moved from sort of big Tier 1 to Tier 1 and tier twos and tier threes, and that's really enabled us to have a broader access. We also did a lot of insourcing, so we've insourced our designers. I have around 200 designers that is a constrained resource in the market at the moment. Having insourced that, it really gives us a security of supply of design resource. In terms of materials, about 18 months ago, we did advanced procurement. For around 70% of our waste schemes, we advanced procured some components. At the time, there was low inflation, so we've avoided inflation there. There was manufacturing capacity, so we did get better pricing. We've got those components now, so we are, you know, a good 18 months ahead of others in terms of having access to those materials. Although it is tough out there, I think the calls that we have made has meant that we have put ourselves in a good position. Very good. Martin, does that answer all the questions? Excellent. Okay, on to Martin. Good morning to you, everybody. A couple of questions if I can, please. The first is around the affordability issue. Can you just remind us what sort of flex you have in deciding when you take revenue? Obviously, you've alluded to deferment of the ODIs or part of the ODIs. Is that it? Are you mandated to take the inflation re-increases or can you push those a little bit further down the line? Secondly, you talked in your presentation about your performance and ambitions on the CSOs. Could you just update us on where you feel the broader investigations from Ofwat and the Environment Agency are, please? Brilliant. Shane tells all of our charges. Yep. Live and breathe. Let's get Shane to talk about how we think about those things. Yes. In terms of the flexibility we have, I guess probably just step back a bit first. We have a number of different components that drive tariffs and our revenues, so obviously the K factor, the revenue adjustment. We've got green recovery, we've got inflation, and we've got ODIs. I think we've found over the last, probably since AMP6, ODIs provide us the best flexibility to manage bills. The others can, you know, provide a degree of flexibility. I think ODIs is the key because we also get adjustment for time, value, money, and inflation there when we defer them. I think our preference is to manage our bill volatility through ODIs, hence we deferred 2/3 from the year one ODIs, which is about GBP 62 million in today's prices. I think looking forward, that inflation is going to be higher and the Green Recovery is going to be higher as well. We'll again manage bills through deferrals. Well done. I think the key thing there, I think, Martin, is we're very conscious of this cost of living, and we're very conscious we're in a good position at the moment. It feels balanced. We've got the second lowest bill in the land, which is a good start point. We have got inflation going on top of that bill, but we can manage the ODIs to make sure that we're not giving customers a higher increase than we think is right. Then also it's about every customer being able to afford that bill. Having a bill for GBP 1 a day that somebody's still struggling with isn't helpful for us or for them. That's why the scheme that Jude outlined has been a brilliant piece of work between Jude and James' teams to identify a way that we can pull together a GBP 30 million fund which supports all of the customers we now believe that are struggling. Good flexibility, and we think this is the right next stage is this balanced approach in terms of an affordable bill for all. In terms of the CSOs investigation, it's the FFT investigation actually. As you know, it's the full flow to treatment that both the Environment Agency and Ofwat opened conversations with the sector about. A bit of progress since we last spoke is that we've not been named as one of the companies that Ofwat's gonna continue to do the next wave of its investigation and enforcement action against. That's one bit of progress. In terms of the EA situation, it's still in data collection stage, so it's right at the start of the process. It's just in those early phases, so unlikely to hear much for a decent period of time. Thank you. Very good. Does that answer the questions, Martin? Very good. Okay, Dominic, we can see your hand in the air. We can't see you, but we can see a hand next to your name. Hello there. I know I got to put my camera on, but I think it's gone a bit funny, so you're going to see two of me. Thank you. I've got a couple of questions, please. The first one is coming back to, I think, Martin's question about restructuring the revenues for the ODIs. I was thinking of sort of moving it to a more sort of philosophical question, which is, to date, you've always basically said that you thought that your consumers want better quality and better ODI sort of outputs over a lower bill. You're reinvesting your TOTEX outperformance into ODIs. Do you think that if we have a cost of living crisis and affordability moves up the agenda, that the slightly better sort of shift would be to not invest your outperformance in your TOTEX in order to share some of those benefits with lower bills with consumers? So that's question number one. Question number two. I'm intrigued on what could be quite a growing theme here, which is labor costs. Have you, what's your sort of feeling on discussions with your employees and your unions about potential rises in wages and salaries going forward as they start to see higher living costs themselves, and whether or not we're gonna start to see that becoming embedded into your sort of annual sort of process? Just final one for the debt book. I think Severn Trent is one of the shortest term debt books and variable debt rates in it. If we're moving to a world where potentially interest rates are gonna sort of structurally move up, what's your feeling about sort of fixing longer term debt in at these sort of rates? Do you think you're gonna carry on with your sort of current sort of shorter sort of term and more variable rate debt book? Thank you. Brilliant. I'll take the philosophical question. I'll hand to Neil to talk about, you know, us as an employer and making sure that we've got, well-managed people. Obviously James will be desperate to jump in on his debt thesis for the future. I mean, I think philosophically, our strategy and our belief is that looking at the average bill is what we're doing. Actually, no customer should struggle with their bill. That's our thesis. On that basis, we want to make sure that we help anybody who's at that lower income end who is struggling. All of the research we do with customers, and it might be helpful for Shane to chip in with the research, most recent research with what coming out from customers as to what they do want versus you and I philosophically thinking what they might want, is I think the analysis we're seeing is that we need to make sure that every customer can afford their bill. That's why moving today was a big thing for us. We've spent a lot of time behind the scenes in the last six months identifying in meetings whereby we could help an extra 100,000 customers. That number is really important because that makes it 315,000 combined, which is exactly the number that the Consumer Council for Water, CCW, judges to be the amount of people that need our support. Now, we'll have to keep an eye on that. Of course, over the next year or two is where that change is. We think this gives us a really good process and a really good setup to have very different conversations long-term. Broadly at the moment, we think actually customers do want out-performing service, a stable bill profile, so not spiky bill increases, but also full support for anyone that's struggling. Shane, do you want to comment on that? Yeah. In all the different pieces of research we've done probably over the last nine years, we've never seen any evidence that customers would like trade off a lower level of service for a lower bill. Even the research we're doing now to inform PR24, still coming out strong as improvements to the natural environment, improvements to drought resilience, reducing obviously the use of CSOs and things like that, and customers are willing to pay for that. I guess the key point that Liz said is helping those that struggle with their bill while the rest of the customers can afford to pay for these service improvements. Very good. Neil, we like to be a good employer. We're proud of it. Do you wanna share some thoughts on that? Yeah, of course. Particularly in terms of pay, so we did a three-year pay deal, which we're now in the third year of. We're a Real Living Wage employer, payer. Obviously we see that move each year depending on the independent verification of what the Real Living Wage should be. When it comes to general engagement with the workforce, so our trade union relationships are pretty excellent. If I'm totally honest, we have a very good relationship with them, ongoing conversations around the impact on their members and the workforce, and we see that come through in our engagement scores, which are really great, versus the sector, and the country as a whole. Obviously there are gonna be pressures that we see on our workforce, and so we're talking to them on a regular basis and seeing how we factor that in. Things like the long-term pay deal that went through COVID is a really good factor in terms of protecting them against some of those issues. Very good. James. Yeah. Thanks. Yes, our overall debt portfolio is average maturity of around 13 years. Of course, there's gonna be some stuff that I'm looking forward to refinancing, which is maturing soon. When I look at what we're replacing that with, what we're refinancing, I still think there's good value at the long end of the curve. It's important to keep in mind that even with interest rates going up and gilt yields going up, as you've seen, there is a good degree of protection from AMP7 onwards in terms of the cost of debt allowance will increase. We're still raising debt at below the iBoxx level. The iBoxx has got an average of around 18 years, and I'm not straying too far away, you know, from that kind of level of maturity when we're doing new debt. Still good value at the long end, still outperforming, for you know, the debt that we're raising. I feel like, you know, still in a good place when it comes to that opportunity to refinance. Very good. Dominic, does that answer all the questions? Yeah. Thank you. Just to follow up on the labor cost then. Is it a fair assumption for us to assume that the labor cost component will go up in line with inflation going forward? Is that kind of a sort of a fair number based on your last sort of three-year? If you look at the journey of time, right, it doesn't exactly mirror. Right. I think it's the key thing. For example, when we've had inflation down at 0.9%, we still chose to give 2.5% because it just didn't feel right. Likewise. Yeah. Yeah when we've had higher inflation, we've not necessarily matched the higher inflation. To be honest, it's not as like for like that. We've also got an all-company bonus scheme as well, which we also know makes a big difference. A lot of our people, they earn quite a lot on allowances, on call-outs, on different things. You know, if simplistically, you want us to put a number in your model, I can see why that would make it simplistic. I don't think it'll be an accurate representation of the end result, but I guess, you know, I can't tell you a different number, but it doesn't normally mirror, is the only thing I would say. Thanks very much. Very good. James, over to you. Hello. I had two questions. The first question is a bit of a multiparter, so apologies for that. The first question is trying to understand slide nine a bit better and your self-generation position. As you obviously highlighted some quite a few metrics on that slide. I just want to understand, I guess, first of all, so are you roughly 2/3 of your self-generation being non-regulated and 1/3 being regulated? Secondly, is it all in BioResources and Green Power, so they're not reported within the regulated entity? I know that you've changed the positioning a couple times in terms of how you've defined the split there. Thirdly, is all of that self-generation market exposed or is some of it on a long-term fixed price PPA? That was the first question. The second one is, I think, Liv, you mentioned earlier that only three of the companies in the sector are outperforming on. I'm not sure if that's a comment on ODI incentives or more broadly on ODIs and TOTEX. But obviously a lot of companies are underperforming on both metrics. I was just wondering how you thought the regulator saw that, because you could interpret that as we've been too tough, or you could interpret that as this sector a lot better, but in you know, it kind of feels like the first reaction might be more intuitive. I was just wondering whether there was a recognition that perhaps some of the targets have been set too tough. Thanks. Really helpful. I'm gonna get James to have a chat through the specifics of those questions, and you might also just get Helen just to talk about where we're going next in terms of green power. I'll start off on what I think the regulator does, and I'll get James to bring out just the reality of what it feels like to actually run some of these measures, which might explain some of the concepts as well. Yeah. I think when you step back and look at Severn Trent, I think it is one of our differentiators, the level of self-generation that we do have. I think it is, you know, certainly in today's environment, when you're seeing very volatile and rising energy prices, it has stood us in good stead. I've been really pleased to see it as part of the portfolio because it has served that very helpful purpose of managing the overall kind of volatility, particularly on the return on equity level. So the specific questions you ask in terms of what the balance is, so it's about 275 gigawatts in each of our green power business and our BioResources. There's a very small amount of energy generation that isn't in BioResources, but it's negligible. The main drivers and the main kinda generation are in BioResources and green power, which, as you know, have got kind of different sharing mechanisms to the kind of consumption area. That's the key point. It's not all. There's a small amount that's hedged going forwards. Some of that will be to do with, say, for example, in green power, you know, we've got some long-term contracts with councils, and some of that will have been locked in for slightly longer. In the main, what we do is we seek to manage that balance and hedge both our consumption and our generation on broadly the same level. We do get an effective kind of hedge. If we've got consumption that's on variable rates, then we will have matching generation at the same level as well, taking into account that kind of self-generation economic hedge we have. Helen, do you wanna talk about the future for Green Power, just to give a flavor? Yeah. I'm really, really delighted this year with Green Power as a business. I really, I just love the business. It's absolutely fantastic. We've done a lot of work this year in terms of integrating Agrivert completely, so we now have one operation. We've had brilliant utilization performance of our assets. We man the assets at around 95% utilization, which is really high. We make sure that we continue maintenance on our assets to enable us to maintain that. We're also looking to invest in the current year in where we can expand our current asset base. We're looking to do that. We've restructured our commercial team, who get in the food waste for us, and they've been really successful at getting in not only the long-term contracts we do with local authorities, which are great, but also a lot more commercial waste. Obviously with COVID recovery, that's been much greater volumes this year. I think you'll continue to see great things from Green Power. Very good. I guess just jumping into the kind of outperformance point, you know, I think if I was a regulator and I was to look at the sector, I'd rather be a regulator that had some winners, some losers, and probably more losers and only a few winners. Maybe that's my mindset of ambition, but that's what I'd probably want to create as a regulator, and I wouldn't wanna be a regulator that was facing into a whole sector outperformance. I'd be thinking, Gosh, that does not reflect so well on me in terms of scale of ambition. I'm sure of what loved last year's APR returns when they realized that so few people were in the winning camp and a lot of people were in the struggling camp, cause I think it shows them to be a strong regulator, to be driving hard for consumer outperformance, to be making sure that bills stay low for customers for the long term. At the same time, the people that did win, there is still that opportunity, so it's not an unfair regime. It's just a regime that requires you to be more creative and to probably be more ambitious. Now, James lives and breathes this every day, having to deliver our stellar outperformance on a yearly basis. Give us a sense of, you know, I guess of when you look at the ranges and your perspective of how hard it is to get to land some of those outperformance measures. It's a great question, James. I think what we very early on hooked into is the fact that our ODIs are effectively what our customers are telling us is important to them on a day-to-day basis. We've managed to really build that ethos into the organization. We back that up with a very performance-driven culture. The culture itself really focused on metrics on a daily basis at a local level, right up to a weekly basis around the exec table. I enjoy my weekly conversations with my colleagues around where my performance is slightly off or not. That performance culture in the organization, the real link to customer expectation is what's driven us from a ODI perspective. I think off the back of that, we've seen some really strong results. When I look at things like water quality performance in particular, we've delivered now five or six years of improvement on the bounce and 20% reduction in this AMP alone. I think that just is a small indicator of how bought in the company is to ODI performance. Very good. Does that give you a full answer, James? Thank you. Yeah. Very good. Over to Verity then next. Hi, morning, everybody. I've just got three very small questions. The first one is on Hafren Dyfrdwy, if you would give us an update on what's good there and how you're performing. Secondly, on interruptions to supply, just do you think you were just not simply allowed enough money to fix this problem at the FD? Just a bit of commentary on how all the increased revenues in non-household retail have flowed through and how you see the business. Thanks. Very good. I'll take number two. I'm gonna hand number one over to James Jesic, and then I'll hand number three will go to James Bowling. It is our fault that we're not delivering interruptions to supply. Please don't believe that we are in any way confused by that. This is not the Ofwat didn't give us enough money. We do struggle to live within the price control on water, but nonetheless, other people manage it. When you cross-compare our year one performance versus others, it wasn't good enough, and I'm sure when you cross-compare our year two performance to others on this particular measure, it definitely isn't good enough. We are very clear. We've got a brilliant performance overall on the ODIs. 88% of the measures are green. The ops teams and James, Helen, and Jude have done an awesome job, but there are three metrics that are still not as good as it could be. One's very close, so we were pretty tight on one, so we feel good about that, and we've been green on it before. Another one was not good enough, and we've been green on it before, so we know how to deliver it. Supply interruptions was definitely not as good as it should be, and you will see us get better this year. We're confident. But yeah, it's definitely firmly in our camp, in nobody else's camp. Good. Now, actually, on a day-to-day basis, James Jesic and I don't run Hafren Dyfrdwy. We gave that task to Helen and James. James Jesic is the MD of HD, and Helen is the FD of HD. I'll get them to comment on what's gone well, and there have been some really good highlights. Thank you, Liv. I'll give a quick overview on performance and then perhaps let Helen cover off some of the financial side of things. Effectively, Hafren has been on an improving trend now for the last two years, and this year I'm really pleased with where we've outturned from a performance perspective. We've delivered over 70% of the ODIs for which Hafren is measured against were green, which is great news. There's still areas we can improve on across the piece which we're doubling down our efforts on in terms of improving those over the coming years. We're able to take some of the learning from Severn Trent and bring that into HD in terms of how we drive that performance and vice versa as well. We've brought some good stuff from HD into Severn Trent. I'm really confident that with the performance that we're driving from an operational perspective, the improvements seen in retail around, complaint reductions, I think we're gonna have a better year this year than we did even, last year. Very much an improving trend. I don't know if there's anything you wanna add financially, Helen. I think all I'd add is that the capital investment program in Hafren is large. We're gonna deliver really strong RCV growth, I think one of the strongest in the sector for the AMP. The program's progressing really well, and that will help support the performance next AMP and at the end of this AMP for Hafren. I think in terms of finance, it's obviously small. The energy costs are obviously impacting Hafren. All I'd say is we have to run a very tight ship. Between James and I, we do that quite successfully, I would say. Even if I do say so myself, Verity. Very good. Self-praise is no praise as you know, Helen. James, do you wanna talk about non-household? Yeah. The increase in revenue, there's probably around GBP 60 million of increase in revenue that you could probably attribute to essentially being in a lockdown world to a non-lockdown world, in the year just past. That's a net number, so what we actually saw in real kind of consumption terms is that, in lockdown, you saw a bigger reduction than that in non-household and businesses. Of course, when more people were at home during lockdown, we saw slightly higher consumption. The net number is around GBP 60 million. There's also another GBP 5 million actually from... We've been running a quite successful voids incentive scheme with our retailers, which actually encourages them to go and find properties that are listed as voids that are actually being occupied, and that's added an extra GBP 5 million. Overall, about GBP 65 million, a little bit more than that in terms of the recovery in business, a little less coming from household consumption, but those are the kind of the net numbers that have impacted revenue. Does that work, Verity? All good? How does that flow down to operating profit or loss? I mean, remember it's recovery from the prior year, and of course our revenue across the whole of the five years is set. In the individual year, it will flow down into EBIT because fundamentally it costs us more or less the same amount to produce the water from one year to the next. We would've predicted that recovery, so it's not like it's an extra. You see what I mean? It was a predicted, that's the next wave of revenue that comes this year. Okay. How does that flow through to operating profit? I mean, what is the operating profit or that you're recording in non-household? Do you mean actually Water Plus? We don't actually kind of separate out the Yeah the profit within Severn Trent Water between household and non-household. Yeah. It's all kind of like within the wholesale kind of price control. In terms of the JV contribution. Sorry. Sorry, we thought you went to non-households in the regulated business, but now clear. Okay. In the JV- Oh, sorry. Yeah, sorry. That's all right. Yeah, sorry. That's all right. Good. Right. Different answer. Get ready for the mark four answer. Okay. Water Plus has been on a journey of recovery, I would say. You know that it was particularly all the retailers in the COVID era were massively impacted by COVID because, you know, frankly, you know, businesses stopped. You know, they closed. That did impact their consumption. You saw that we, you know, our share of the losses was quite significant for Water Plus last year. I'm delighted to say that actually, you know, things are much improved in Water Plus, and actually our share of their losses for last year was GBP 2.2 million. Now, we're still absolutely focused on getting that back in, into the black, and that's our intention and our ambition for the year ahead. Things are looking much more positive and I think, you know, their cash collections have improved, operating margins have improved, so it is an improving picture for Water Plus going forwards. Sorry for not understanding your question, Verity. Thank you. No, that's all right. I probably phrased it really poorly. Thank you very much. Very good. Jenny, over to you. Hi. Morning, everyone. Two questions, please, Liv, firstly, can you just give us a sense of what you're expecting in terms of the upcoming methodology paper from Ofwat? I think it's end of July we're expecting that. Obviously, there's a bit of continuity with David Black being in charge, but is there any meaningful areas of change that you are expecting? Secondly for James, just looking at your presentation slides at the back, I think you've got something like GBP 1.3 billion worth of debt coming up for renewal for the rest of this AMP. Can you just give us a sense of what we're expecting in terms of improvements on that refi, on the interest line? Thanks. Very good. I mean, you know, we'll find out more in July. I think the three things I'd say is evolution, not revolution, cause we have got the same senior team, right? It's not just David. If you look, you know, David's senior team are all intact and all in place, and they would've been working on this price review as a seamless situation for the last period of time. That'd be the first thing. The second thing is July won't be December, and it won't be the final determination. I've lived through a few of these price reviews now. I did AMP 5, I did AMP 6, I'm now doing the next one. I guess in that sense, we've got to expect that there'll be some stuff we like in July. I'm sure there'll be some stuff we don't like in July, and we'll have to continue the conversation. I think always remember that it's a journey from whatever comes out in July. The third thing is I think the fundamentals of the business in terms of value creation, it comes from, first of all, long-term investment, and I think this is going to be a long-term investment AMP. It comes from the ability to create winners and losers in a sector, and I think of what has firmly reiterated that they want to have ODIs, maybe more commons and less be-spokes, but they want more ODIs. They want to select people that push the boundaries. I'd be surprised if affordability and bill size and shape, and companies being really strong social purposeful companies isn't right at the heart of it, considering the wider mood. That plays to everything we believe in, to be fair. You know, in the fundamentals, I suspect our opinions are aligned. Doesn't mean I'll like every last mathematical point or won't violently disagree with a few things, but I guess we'll make those views clear. Yeah. James. Yeah. On the refinancing opportunity. Still got about GBP 2.5 billion to raise over the balance of the AMP. As you rightly say, about GBP 1.3 billion of that is refinancing. I would say probably about a third of that is what I would call high cost, and I'm quite looking forward to, frankly, getting rid of, which is good. That does represent a real opportunity, I think, to you know, to reduce you know, the overall cost of interest. You know, as we've mentioned earlier, you know, interest rates are rising slightly. You know, compared to this time last year, probably my new refinancing is gonna be at those slightly higher rates than they were a year ago, which is gonna temper the benefit, I think, of the refinance. It's always important to remember that we do get compensated for that through the true-up. Yeah, some good opportunities on about a third of that debt, and that's coming in the next couple of years. Then the balance will still be at competitive rates, beating the iBoxx, but probably slightly higher than last year. There is protection in the true-up model for that. Sorry, just as a follow on, in terms of your definition of high cost, I'm assuming this is 5%+ territory. Well, yeah. Some of it is around about that rate, and then some of it is quite expensive, RPI-linked debt. There's one that's coming up in the next sort of six months that's RPI-linked that I'm quite looking forward to getting rid of as well. Perfect. Thank you very much. Very good. I think we've got the tiniest photo ever. I think it's Chris, but gosh, it's like a postage stamp. It is you. Morning, morning. Okay. I was squinting to see if it was you. Good morning. There's my head popping up the other bottom. Apologies. Two questions from me. Very high level, though. In terms of RoRE, you've got a very stable RoRE trajectory so far this AMP, but your IFRS earnings clearly are impacted by volatility driven by inflation. Just the outlook for the remainder of this AMP. Do you expect the trajectory of RoREF to remain stable? And how do you see that playing out over the next couple of years? Any guidance you can provide us would be helpful. In terms of RCV growth, I think you're leading the charge across the sector in terms of RCV growth, and your guidance is clearly very strong. In the past, Liv, you've spoken about the possibility or potential of pulling some RCV activities or some growth activities from AMP 8 into AMP 7. Just wondering whether you can provide an update on that. Is that still something on the agenda or, you know, are you focused on PR24 and then accelerating further in AMP 8, and you're comfortable with the level of growth that you've got foreseen over the next couple of years? Very good. I'll start with the second one, then James and I. Yeah. Both contribute, I think, to the first. I mean, we've already accelerated a good chunk of growth into this AMP, right. Remember, we started the AMP with a growth rate of about 3% real RCV, and we're now 10.8% real RCV growth. We've moved quite a chunk already, and as part of that, we did accelerate our AMP8 WINEP spend already into AMP7. We've already had the upside of that benefit of being allowed to progress that. I suspect because there is such a large topic of conversation about the environment, you know, we stand ready that if at the point in time in the next couple of years, it became relevant that anything extra that was due for AMP 8 needed to be brought forward into AMP 7, we've got a fantastic setup in our capital delivery that I know Helen will be delighted if I said to her, Good news. Opportunity to do even more. I know that she'd give me a lovely smile and say, Excellent news. I think there is. Yeah, that still remains. I think you're talking small numbers because I think, you know, the way transition spend typically works is you're talking, you know, GBP 2 million, not GBP 1 billion. To give you some sense of scale, there are a few things we think where acceleration would be helpful, but it's not scale numbers. I think it's rounding edges versus our RCV growth. I don't think AMPs are as clear-cut as everybody else does. People sometimes talk about it like it ends, and then it begins. I think really, if you get yourself in a strong shape in your capital program, and I think if you get yourself in a good position by talking early with regulators, I think that gives you an opportunity that you get comfortable knowing what your likely underlying base spend is going into the next AMP. You can begin organizing the contracts, pre-buying, procurement activities, hiring resource, all the stuff that we did a little bit at risk at the end of the last AMP, which has put us in such fantastic position for this AMP, which allowed us to escape the impact of COVID because we'd prepped ourselves ready. We would be doing some of that. Your base spend is already a large number before you get into the enhanced activities. We've already got one eye on how do we best deliver most efficiently for customers, that base spend going into the next AMP. You should assume it's not gonna be the hard stop. It's already gonna be a constant activity plan where we've already got one strong set of eyes looking at the future. In terms of guidance on RoRE, I mean, it's three component parts. Yeah. I'll let James tell you about financing. Yeah. We've given you pretty good guidance on RoRE in terms of TOTEX that we expect within our allowance. Then, in terms of ODIs, we've given you. You know what the first two years are. We've given you an indication for the third year, and we've always said that the final year does have an extra. Kicker in it, yeah. an extra kicker in it, about GBP 50 million based on end of AMP measures. Yeah. That's as much as we're gonna give you in terms- Yeah. of definitive guidance. I guess the balance is, you know, what happens on financing, and I think, you know, as I've described in my presentation that actually, we've outperformed on the last six years on financing. What you see is that when inflation is high, we typically, you know, do better on the RoRE line. When inflation is low, and we have had a couple of years within those six where it's been low. Mm. We've still outperformed. It just isn't quite so much. I think when I look at the year ahead, if inflation stays as it is, I'm pretty confident that we're gonna outperform on financing. We're gonna be neutral on TOTEX because that's our ambition, to spend what we've been given as an allowance, and of course, the ODIs will reflect the guidance that we've given. I think on balance, I feel confident that we'll continue to outperform, but inflation will play a part in terms of how much that outperformance will be, particularly in years four and five, where I have kind of less visibility in terms of what's gonna happen to inflation. Is that fair enough, Chris? Does that answer the questions? Thank you, Liv. It does. Thank you, James. Very good. Bartek, over to you. Good morning. Two things, please. Firstly, I just wonder if this high inflationary environment somehow impacts your thinking about the ODIs and TOTEX outperformance trade-off, that maybe you would probably push for more TOTEX outperformance and less ODIs. I mean, you just said you will try to be neutral on TOTEX, but I wonder if actually there is a risk that you may underperform on TOTEX given where inflation is. That would be my first thing. Second thing, on self-generation, do you think the current situation, if it prevails going forward, it could somehow unlock the wave of self-generation investments in the sector in the future, especially in AMP8, whether the regulator would be happy to see more self-generation investments? In terms of your thinking, would you prefer, if you were to invest more in self-generation, to actually have those assets under a deregulated regime, the regulated scheme or actually do it on sort of a merchant basis and probably get more TOTEX outperformance in the future? Thank you. Good deep questions. I mean, to solar self-generation, the regulator has created the BioResources charge control, and effectively it wants a market-forcing competitive situation. It doesn't want to just straight fund activities. It doesn't want you to add things onto the RCV going forward for BioResources. It's basically saying that if energy costs are high, the market should create the investment situation. It's encouraging more non-reg investments, not necessarily reg investments. That's definitely the strategy, and I can totally see their point. Actually, in a high inflation situation when energy is expensive, it does make the business case better from a non-reg situation. Yeah. They're right to push that way, and we feel good about the fact that we've made a lot of chosen investment over the last period of time that now looks better value than when we made it, which is great. It was already good double-digit IRRs when we made most of the investments, and now it looks even better. I think you should see non-reg investment, not necessarily reg investment. The one exception to that, which it might be worth touching on, is I'll let Bob just talk about a side topic that is of relevance, which is around net zero. Because actually, when you begin to look at the future to get to net zero, there could be some regulatory-oriented investments that actually also helps in this space in terms of efficiencies and less energy use. I'll get Bob just to give you a bit of a hint to the future about that. I think we've ticked off self-generation on that. In terms of how we think about it, I mean, personally, and I know the team are all in the same place, is that we want to deliver what our customers want. You run a monopoly, then you have to deliver what the customers have asked for more than anything else. Our customers have made it really clear that what they want more than anything else is great service on those metrics that they chose to put financial reward against. I think it would be inappropriate, genuinely, for us to be saying as a team, Actually, we'd rather make more TOTEX outperformance and less ODI investment, and we'll balance it. That's just not the right call. Our customers want us to deliver amazing service, and so our plan remains the same for the next few years, which is to absolutely outperform big style on ODIs, to live within our means on TOTEX. There might be some investment cases towards the very tail end of the AMP as getting ready for the next AMP where we might choose to actively invest more money. As it stands for delivering our current commitments, we'll live within our means. That will require us to make more efficiencies because, as you say, some underlying costs will go up. We are choosing to create, for example, the funds for the extra 100,000 customers we've talked about today. I suppose we're quite a creative team. Many of us have come from other sectors, and we're clear that there are always different ways that you can skin a cat. Actually, through, you know, hardship times like now when some of the costs look a bit harder to deliver, you find new ideas that stand you in fantastic shape for the future. We're gonna be looking for some of that creativity to come out over the next year to solve some of the underlying cost increase. I'll get Bob to talk about net zero because it's quite an interesting situation for where energy will be less necessary going forward. Great. Hi there. I guess if you think about our journey as a landlocked water company where we couldn't dispose of our sewage sludge to sea back in the day. In the 1950s, we set off on our anaerobic digestion journey. I guess thermal hydrolysis come along, you know, ten years ago or so. We've invested GBP 200 million in thermal hydrolysis, which means we squeeze much more energy out of our sewage sludge already. I guess the next stage of that journey has always been around pyrolysis and gasification. I was just in the Global Water Summit just last week in Madrid, where that's really starting to take off actually, especially in some of the continental companies. That's gonna be the next phase. Gasification and pyrolysis are where we're putting a lot of innovation efforts at the moment. Brilliant. I think it just gives you a sense that actually don't assume that the next AMP is just a repeat of the past. I think it's very likely to work different. You'll probably see rather than seeing similar THP investment, you might see movements towards pyrolysis, which is brilliant for net zero, but actually also good on an energy gain again. Thank you very much, Bob. Thank you. Okay, good. Thank you. I think that's all the questions we currently have. With that, well, that was really good. Thank you very much for so many totally different questions, and we look forward to catching up with many of you over the course of the next few months. That's it. Over and out.