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New Jersey American Water Files for Rate Adjustment
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New Jersey American Water has filed a petition with the New Jersey Board of Public Utilities for new rates due to over $985 million in infrastructure investments since the last rate review. The upgrades aim to enhance water quality and service reliability for 2.8 million customers. Proposed rate increases include $6.78 for average residential water bills and varying increases for sewer services. The rate request will undergo a thorough review process taking at least nine months, with final decisions made by the BPU.
Positive
Investment of over $985 million in water infrastructure upgrades.
Enhancements include 140 miles of water main replacements and compliance with PFAS regulations.
Continued provision of high-quality service at competitive rates, estimated at about a penny per gallon.
Negative
Proposed rate increases may impact affordability for some customers.
Over $985 Million in System Upgrades for Water Quality and Reliability Drives Request
CAMDEN, N.J.--(BUSINESS WIRE)--
New Jersey American Water has filed a petition with the New JerseyBoard of Public Utilities (BPU) for new rates based on the significant investment the company has made or will make into its water and wastewater infrastructure since its last rate case.
“Since our last rate case, we have invested or will invest more than $985 million in infrastructure upgrades, including nearly 140 miles, or over 736,000 feet, of water main, to continue to deliver high-quality water, reliable service and fire protection for the more than 2.8 million people in 18 counties we serve,” said Mark McDonough, president of New Jersey American Water.
Some of the company’s critical infrastructure projects across its service areas included in the rate request are as follows:
Filter rehabilitation project and related improvements to improve water quality at the Raritan-Millstone Water Treatment Facility, serving more than 1 million people in the company’s Central operating region including Mercer, Middlesex, Somerset, Hunterdon and Union counties.
System improvements to six of the company’s seven surface water treatment plants – Oak Glen, Swimming River, Delaware River, Canal Road, Canoe Brook and Raritan-Millstone Water Treatment Plants – serving most of the company’s customers.
Replacement of aging, critical, large-diameter transmission mains in the company’s Central and Coastal regions, and several large-scale pipeline replacement projects throughout the state to improve system reliability.
Improved groundwater treatment for PFAS to maintain compliance with DEP regulations, and for 1,4-dioxane at the Delaware River Regional Water Treatment Plant to meet proposed regulations.
Implementation of additional leak detection technology in the company’s Central and North operating regions.
Replacement or upgrades to improve water quality at dozens of wells, pumping stations and other critical facilities serving customers in service areas throughout the state.
Sewer system upgrades to protect the environment throughout the company’s statewide service areas including sewer mains, lift stations and other infrastructure in Ocean City, Lakewood, Long Hill and Haddonfield.
In addition to these major projects, New Jersey American Water’s investment into replacing or rehabilitating nearly 140 miles, or over 736,000 feet, of aging water mains is also included in this rate request. The company renews aging water mains on a 90- to 100-year cycle, which achieves the level of investment recommended by New Jersey’s Water Quality Accountability Act. As reflected in the company’s certification submission in December 2021, New Jersey American Water is fully compliant with each requirement of the law, including Safe Drinking Water Act regulations, licensing of water supply and wastewater operators, water supply allocation permits, hydrant and valve maintenance, cyber security, violation mitigation plans, and infrastructure improvement/capital investment plans. The company is also poised to be in compliance with new amendments to the law that were added for 2022.
New Jersey American Water’s investments into its treatment facilities to comply with new regulations for PFAS and upcoming regulations for other compounds are also included in this rate request. While many drinking water utilities are challenged by PFAS contamination, New Jersey American Water successfully piloted cutting-edge treatment strategies to effectively remove PFAS from several groundwater stations and is also upgrading treatment capabilities at its surface water treatment plants for other emerging compounds. New Jersey American Water’s water treatment technology, combined with its proactive infrastructure investment program and the expertise of more than 800 professionals across the state work together to support the continued provision of high quality and reliable water service to customers.
McDonough added that New Jersey American Water’s rates are based on the actual cost of providing water and wastewater service. “To help mitigate rate increases for customers, we work very hard to control our costs, leverage our economies of scale and operate as efficiently as possible,” he said. “Even with the proposed increase, the cost of high-quality, reliable water service would continue to be about a penny per gallon and remain among the lowest household utility bills.”
If the company’s proposed rates are approved as requested, the monthly water bill for the average residential customer using 5,520 gallons per month, would increase $6.78 per month, or $0.23 cents per day. The average monthly residential sewer bill would increase between $0.26 and $16.69, depending on the service area.
The company’s rate request undergoes extensive public scrutiny by the BPU, the New Jersey Division of Rate Counsel, and the Office of Administrative Law. This vetting will include numerous interrogatories, public hearings and evidentiary hearings. This process, based on prior requests, can take a minimum of nine months. To increase transparency of the process, the company’s petition and its associated exhibits are being posted to the Company’s website, newjerseyamwater.com, under Customer Service & Billing, Your Water and Wastewater Rates.
New Jersey American Water is seeking a total annual revenue increase of approximately $94.7 million. The increased rates proposed in the rate petition are a request only. The New JerseyBoard of Public Utilities will make the final decision regarding the actual increase. Once a final decision has been made, customers will receive information on the new rates in the mail and on the company’s website. New Jersey American Water also continues to provide income-eligible customers with payment assistance programs, including its H2O Help to Others program, which provides service charge discounts of up to 100 percent. For more information, visit newjerseyamwater.com, under Customer Service & Billing, Bill Paying Assistance.
About New Jersey American Water
New Jersey 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 and/or wastewater services to approximately 2.8 million people. For more information, visit www.newjerseyamwater.com and follow New Jersey American Water on Twitter and Facebook.
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 6,400 dedicated professionals who provide regulated and regulated-like drinking water and wastewater services to 14 million people in 25 states. American Water provides safe, clean, affordable and reliable water services to our customers to make sure we keep their lives flowing.
