An article on how the debt crisis at Thames Water is jeopardizing £100 billion ($125 billion) of potential investment required over the next five years to mend Britain’s crumbling utilities infrastructure, refers to a recent paper by the EDHEC Infrastructure & Private Assets Research Institute which stated that investors will reassess the risk involved in lending to infrastructure assets, including airports and rail, if the government forces them to wear some of the costs of the Thames restructuring.

“Currently, there’s no inclusion for political or default risk in Ofwat’s regulatory price formula that determines the return on equity for owners. If Thames is wiped out, Ofwat will have to overhaul or incorporate these risks into its models, which would ultimately push up bills for consumers, EDHEC research director Tim Whittaker said in an interview. (…) “Previously, the assumption was that investors were protected, resulting in low interest rates,” Whittaker said. “Now these assets have become riskier.””

Read the full coverage here.