California American Water Files Response Comments to Public Advocates Office Motion on Water Reuse Decision

Rhea-AI Summary

California American Water (NYSE: AWK) has responded to the Public Advocates Office's (PAO) motion seeking a rehearing on Decision 22-12-001 regarding the Pure Water Monterey Expansion (PWMe) project. Their response supports the PAO's request for changes that would address two main issues: securing funding for new extraction wells and correcting legal errors in infrastructure funding. The company stresses that it will proceed with the PWMe agreement if the PAO's amendments are adopted. Notably, the original commission decision could negatively affect the company's operations and customers.

Positive

• California American Water supports the PAO's motion, which includes critical changes to the PWMe agreement.
• The response reinforces the company's commitment to the PWMe project, enhancing water supply for the Monterey Peninsula.

Negative

• Decision 22-12-001 includes legal errors and delays in recovering infrastructure investments, potentially hurting the company and its customers.

 Company Joins Consumer Advocates’ Call for Timely Reconsideration of Pure Water Monterey Expansion

MONTEREY, Calif.--(BUSINESS WIRE)-- California American Water filed a response to the Motion of The Public Advocates Office (PAO) for Leave to File Amended Response to California-American Water Company’s Application for Rehearing of Decision 22-12-001. The motion seeks a speedy review of the California Public Utilities Commission’s recent decision concerning the Pure Water Monterey Expansion (PWMe) water purchase agreement. California American Water’s response supports the PAO’s request.

The PAO’s motion, if adopted in a rehearing decision, would correct two of the most problematic aspects of the original decision. It would secure funding for two new extraction wells vital to delivering water from the PWMe to customers on the Monterey Peninsula. Also, the decision, as modified, would partially address legal errors related to how infrastructure funding is accounted for during the construction period. California American Water’s response affirms that the company would move forward with the PWMe water purchase agreement if the PAO’s changes are adopted in a rehearing decision. While the motion doesn’t address all of the legal and factual errors of the original decision, California American Water supports PWMe as a critical component of the future water supply portfolio for its Monterey Peninsula customers and urges the CPUC to move forward expeditiously.

“California American Water is committed to moving forward with the Pure Water Monterey Expansion agreement with the corrections the PAO has proposed. We encourage the CPUC to grant a rapid rehearing and address the errors in the original decision,” said Kevin Tilden, president of California American Water. “California American Water has built new infrastructure and advanced funding to our partner agency supporting the expansion of the Pure Water Monterey project. We want to quickly resolve the key issues with the CPUC decision and move forward with the new supplies to protect the Carmel River.”

In its PWMe decision (D.22-12-001), the Commission delayed recovery of infrastructure investments made by the company to support the project, changed capital structures for project development and contradicted CPUC precedent and practice. The decision as written would have substantial negative impacts on the company, its customers and the region. California American Water has requested the CPUC review the decision to correct clear legal and factual errors and allow the company to move forward with the project water purchase agreement.

In November 2021, California American Water, Monterey One Water and the Monterey Peninsula Water Management District all signed a Memorandum of Understanding to proceed with a purchase agreement for water provided by Monterey One Water Expansion if the CPUC approved recovery of infrastructure costs advanced by California American Water. The company remains committed to the terms of the memorandum.

Together, the recently approved desalination plant and the Pure Water Monterey Expansion will allow the community to replace water no longer available from the Carmel River and comply with the orders of the State Water Resources Control Board.

About California American Water:

California American Water, a subsidiary of American Water (NYSE: AWK), provides high-quality and reliable water and wastewater services to more than 700,000 people. Information regarding California American Water’s service areas can be found on the company’s website www.californiaamwater.com.

About American Water:

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 6,500 dedicated professionals who provide regulated and regulated-like drinking water and wastewater services to more than 14 million people in 24 states. American Water provides safe, clean, affordable, and reliable water services to our customers to help keep their lives flowing. For more information, visit amwater.com and diversityataw.com. Follow American Water on Twitter, Facebook and LinkedIn.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230315005960/en/

Media:

Josh Stratton

Manager, External Affairs

California American Water

831-435-6015

Josh.Stratton@amwater.com

Source: California American Water

FAQ

What is the recent update regarding California American Water and the Pure Water Monterey Expansion?

California American Water has filed a response supporting the Public Advocates Office's motion for a rehearing on the Pure Water Monterey Expansion project.

How does California American Water plan to address the issues with the Pure Water Monterey Expansion?

The company indicates they will proceed with the project if the PAO's proposed changes are adopted in the rehearing.

What are the implications of Decision 22-12-001 for California American Water?

The decision could negatively impact the company's infrastructure funding and overall operations.

When did California American Water first commit to the Pure Water Monterey project?

The commitment was made in November 2021 with a Memorandum of Understanding signed with Monterey One Water and Monterey Peninsula Water Management District.