Agreement Reached in West Virginia American Water Rate Case and Distribution System Improvement Charge Case
October 29, 2018 at 09:21 AM EDT
West Virginia American Water announced today that it has reached an agreement with Public Service Commission (PSC) staff and the Consumer Advocate Division (CAD) in the company’s pending rate request and Distribution System Improvement Charge (DSIC) rate request. The joint stipulation filed late Friday afternoon still requires the review and approval of the Public Service Commission.
West Virginia American Water’s rate request, filed in April, was driven by the company’s ongoing infrastructure investments that are necessary to maintain and improve water quality, service reliability, and fire protection. The company will have invested $200 million in improvements to upgrade water mains, treatment plants, tanks, valves, booster stations and other infrastructure between its last rate case and when new rates go into effect.
If approved as proposed, the company’s base water rates would increase by $23 million per year. For the average residential customer, the increase to customer water bills would be 14 percent, when taking into account the DSIC surcharge that customers are already paying, which amounts to a monthly increase of $6.69. The company’s base wastewater rates for its Fayetteville and Winona sewer customers would increase by 17.4 percent, which amounts to a monthly increase of $7.49 for the average residential customer. The current DSIC surcharge will remain until new rates go into effect on February 25, 2019, at which time the DSIC rate will be reduced to zero for the remainder of the year.
As part of the proposed settlement, the company’s excess deferred taxes, brought about by the Tax Cuts and Jobs Act of 2017, will benefit customers and be used to help offset future DSIC surcharges until the company’s next rate case. The agreement also approves a new, proactive approach to addressing customers’ lead service lines proposed by the company to protect customer health and safety. The increase does not include any costs associated with the Freedom Industries chemical spill. The agreement mandates that the company not seek another rate increase before April 30, 2021.
“We appreciate the thorough, diligent and thoughtful work of the parties involved in coming to an agreement on this case,” said Brian Bruce, president of West Virginia American Water. “Usage and population declines do not lessen our company’s need to renew and replace aging infrastructure and satisfy increasingly stringent drinking water regulations, and we demonstrated to our regulators and our customers that we have been good stewards of our customers’ monthly water payments by keeping operating expenses relatively flat for the past 10 years.”
West Virginia American Water recently worked with the West Virginia Department of Health and Human Resources to distribute applications for the company’s special reduced rate program to eligible customers throughout its service area. This program provides a 20 percent discount on residential water rates for low-income customers determined eligible by WVDHHR. Approximately 5,000 West Virginia households are currently enrolled in this program. Customers can learn more about West Virginia American Water’s bill assistance programs, including budget billing, installment plans, reduced rate program and emergency grants by calling Customer Service at 1-800-685-8660 or visiting https://amwater.com/wvaw/customer-service-billing/low-income-program.
View West Virginia American Water’s Infrastructure Upgrade Map to see how and where the company has invested in infrastructure upgrades in 2017 and 2018.
West Virginia American Water, a subsidiary of American Water (NYSE: AWK), is the largest investor-owned water utility in the state, providing high-quality and reliable water services to approximately 530,000 people. 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 over 14 million people in 45 states and Ontario, Canada. 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.