California American Water has filed an application to set new rates in each of its service areas for 2021 through 2023. The new rates would take effect January 1, 2021, pending approval by the California Public Utilities Commission.
This application is seeking to raise revenue by approximately $46.5 million over three years, beginning with a $26.0 million increase proposed for January 1, 2021. This increase is based on 2019 authorized revenues calculated at current rates and amounts to an approximately 10.6 percent increase in revenue for the company. Specific increases for each service area or the “rate design” are included in the filing.
“Our proposal is driven by the needs of our customers as well as our need to upgrade and maintain our infrastructure,” said Rich Svindland, president of California American Water. “We want to continue to provide customers excellent value for their water service and maintain our systems to provide high-quality water service.”
The request seeks $197 million for infrastructure improvements for the 2021-2022 capital test years. The request for the increase will assist in funding system and infrastructure improvements to help maintain high-quality water service. The increase will renew and replace water treatment facilities, pumps and pipelines.
These capital investments, which include upgrades to the water distribution system, water treatment facilities, storage tanks and pumping stations, are necessary to maintain and improve water quality, reliability, fire protection and customer service for over 50 communities served by California American Water.
The company will continue its commitment to affordability with proposals to offer conservation and tiered rates, which will provide customers with lower rates for essential water use. The company will also propose continuing its low-income ratepayer assistance program across the state and expand on a successful pilot program to partner with local organizations to provide grants to customers who would otherwise be disconnected for nonpayment. To promote conservation, the company will continue its comprehensive programs in each of its service areas that offer customers a wide range of water-saving services and devices.
“We encourage everyone to take advantage of our conservation programs to reduce their water use and lower their water bill,” Svindland said. “In each district, we offer free water use audits, and free water-saving devices. We will also propose continuing our low-income program for qualifying customers who may need assistance with their bill and offering additional support for customers facing financial difficulties.”
The increased rates proposed in the rate petition are a request only. The CPUC will make the final decision regarding the actual increase. The CPUC will hold Public Participation Hearings on this request to get input from customers and the public. California American Water will notify customers of the time, date and location once the hearings are set. Rates will remain unchanged until this request undergoes extensive public scrutiny by the CPUC. This process will include extensive, independent review and public evidentiary hearings. The process is expected to conclude in late 2020, with new rates taking effect by January 1, 2021.
California American Water, a subsidiary of American Water (NYSE: AWK), provides high-quality and reliable water and/or wastewater services to more than 690,000 California residents. Information regarding California American Water’s service areas can be found on the company’s website www.californiaamwater.com.
With a history dating back to 1886, American Water is the largest and most geographically diverse U.S. publicly traded water and wastewater utility company. The company employs more than 7,100 dedicated professionals who provide regulated and market-based drinking water, wastewater and other related services to more than 14 million people in 46 states. American Water provides safe, clean, affordable and reliable water services to our customers to make sure we keep their lives flowing. For more information, visit amwater.com and follow American Water on Twitter, Facebook and LinkedIn.