Pennsylvania American Water Invests $675 Million in System Upgrades Statewide in 2024

Rhea-AI Summary

Pennsylvania American Water has announced a significant $675 million investment in system improvements across its service areas in 2024, covering 37 counties and 418 communities. The investment breakdown includes $583 million for water systems and $92 million for wastewater systems.

Key infrastructure improvements include:

• $220.4 million for installing 94.7 miles of water and wastewater mains
• $13.6 million for 1,038 fire hydrants and 3,165 valves
• $40.5 million for 11,651 service lines

The company's president, Justin Ladner, emphasized their commitment to maintaining and upgrading infrastructure for safe, clean, and reliable service. This investment initiative has generated over 10,125 jobs throughout the economy.

Positive

• Major $675 million infrastructure investment demonstrates strong financial capacity
• Significant expansion with 94.7 miles of new water/wastewater mains
• Creation of over 10,125 jobs through infrastructure investments
• Large-scale service improvement covering 418 communities

Negative

• None.

Insights

Financial Analyst

Pennsylvania American Water's $675 million capital investment program for 2024 represents a significant commitment to infrastructure modernization that strengthens AWK's long-term competitive position. This substantial capital deployment - $583 million for water systems and $92 million for wastewater systems - directly expands the company's rate base, which is the critical driver of future earnings growth for regulated utilities.

The investment breakdown reveals strategic prioritization: $220.4 million for nearly 95 miles of main installations, $13.6 million for fire hydrants and valves, and $40.5 million for service lines. These expenditures address aging infrastructure while positioning the company to maintain service reliability and regulatory compliance across its 418 communities in 37 Pennsylvania counties.

For AWK investors, these capital investments create a virtuous cycle: the company deploys capital to improve infrastructure, which expands the rate base, which in turn enables the company to file for rate increases with regulators, ultimately driving revenue and earnings growth. The economic multiplier effect - generating over 10,125 jobs - also strengthens AWK's relationship with communities and regulators, potentially easing future rate case approvals.

This proactive investment approach aligns with AWK's long-term strategy of securing stable, regulated returns while reducing operational risks from system failures or compliance issues that could emerge from deteriorating infrastructure.

Utility Infrastructure Expert

Pennsylvania American Water's infrastructure renewal program demonstrates textbook utility capital planning. The 86.4% allocation toward water systems versus 13.6% for wastewater systems aligns with the company's operational footprint and prioritizes its core service offering.

The installation of 1,038 fire hydrants and 3,165 valves ($13.6 million) represents critical investment in system reliability and public safety components. These assets not only serve emergency response needs but also enable more precise system control during maintenance events, reducing service disruptions.

Particularly noteworthy is the $220.4 million commitment to linear infrastructure (94.7 miles of mains), targeting the most failure-prone and hydraulically limiting components of water delivery systems. This systematic replacement approach helps prevent costly emergency repairs while incrementally improving system hydraulics, water quality, and reducing non-revenue water losses.

The 11,651 service line installations ($40.5 million) likely include lead service line replacements, addressing regulatory compliance requirements while eliminating potential public health concerns. This proactive approach mitigates regulatory and liability risks while enhancing customer confidence.

By consistently executing on planned infrastructure investments, Pennsylvania American Water strengthens its operational resilience, reduces emergency maintenance costs, and positions itself favorably with regulators who increasingly scrutinize utilities' infrastructure investment records when considering rate cases.

Proactive capital investments are crucial to maintaining service reliability, water quality and flow for fire protection

MECHANICSBURG, Pa.--(BUSINESS WIRE)-- Pennsylvania American Water announced today that its 2024 full-year investment total for system improvements came in at more than $675 million throughout its statewide service areas serving 37 counties and 418 communities. Of that total, over $92 million was invested in the company’s wastewater systems and $583 million in its water systems.

“At Pennsylvania American Water, we take pride in continuously maintaining and upgrading the infrastructure that helps keep life flowing for our customers,” said Justin Ladner, the company’s president. “To provide high-quality, reliable water and wastewater services, we’re committed to the proper planning, careful implementation, and of course, investment dollars, that are necessary to ensure our systems operate safely and efficiently.”

Ladner added that in addition to helping the company continue to provide safe, clean, reliable service for customers, this level of investment generated more than 10,125 jobs throughout the economy.

Pennsylvania American Water’s annual investments include upgrades and improvements made to the company’s water and wastewater infrastructure, including treatment plants, tanks, pump stations, pipes, fire hydrants and metering equipment. System improvement highlights for 2024 include:

• Water/Wastewater Mains: A $220.4 million investment to install 94.7 miles of water and wastewater main
• Fire Hydrants and Valves: A $13.6 million investment to install 1,038 fire hydrants and 3,165 valves
• Service Lines: A $40.5 million investment to install 11,651 services

Pennsylvania American Water continually invests in the local communities where it operates to help ensure that water and wastewater infrastructure that is reaching the end of its useful life is replaced to improve service for residents.

To learn more about Pennsylvania American Water’s infrastructure investments across the state, visit pennsylvaniaamwater.com/infrastructure.

About American Water
American Water (NYSE: AWK) is the largest regulated water and wastewater utility company in the United States. With a history dating back to 1886, We Keep Life Flowing® by providing safe, clean, reliable and affordable drinking water and wastewater services to more than 14 million people with regulated operations in 14 states and on 18 military installations. American Water’s 6,700 talented professionals leverage their significant expertise and the company’s national size and scale to achieve excellent outcomes for the benefit of customers, employees, investors and other stakeholders.

For more information, visit amwater.com and join American Water on LinkedIn, Facebook, X and Instagram.

About Pennsylvania American Water
Pennsylvania American Water, a subsidiary of American Water, is the largest regulated water utility in the state, providing safe, clean, reliable and affordable water and wastewater services to approximately 2.4 million people.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250313521427/en/

Media:

David Misner

Senior Manager, External Communications

717-262-7525

david.misner@amwater.com

Source: Pennsylvania American Water

FAQ

How much did Pennsylvania American Water invest in infrastructure improvements in 2024?

Pennsylvania American Water invested $675 million in system improvements in 2024, with $583 million for water systems and $92 million for wastewater systems.

What specific infrastructure improvements were made by Pennsylvania American Water in 2024?

The company invested $220.4 million in water/wastewater mains, $13.6 million in fire hydrants and valves, and $40.5 million in service lines.

How many jobs were created through Pennsylvania American Water's 2024 infrastructure investment?

The investment generated more than 10,125 jobs throughout the economy.

How many communities does Pennsylvania American Water serve with these improvements?

Pennsylvania American Water serves 418 communities across 37 counties in Pennsylvania.

How many miles of water and wastewater mains were installed in 2024?

The company installed 94.7 miles of water and wastewater mains as part of their $220.4 million investment.