Aqua Pennsylvania Secures Nearly $78 Million in Low-Interest Loans to Support Installation of More than 133,000 Feet of Water Mains & New Fire Hydrants

Rhea-AI Summary

Aqua Pennsylvania has secured $77.5 million in low-interest loans from PENNVEST to support 21 infrastructure projects across Pennsylvania. The funding will enable the installation of 133,400 lineal feet of water mains and approximately 80 new fire hydrants over the next three years. These improvements will benefit customers in Bucks, Montgomery, Delaware, and Chester Counties, reducing water loss and enhancing service reliability.

Aqua Pennsylvania is the first PUC-regulated water utility to secure funding through PENNVEST's Programmatic Financing (ProFi) program. The company has now obtained nearly $115 million in grants and low-interest loans for projects across the Commonwealth in the past three years, demonstrating its commitment to upgrading aging infrastructure and improving customer service.

Positive

• Secured $77.5 million in low-interest loans for infrastructure improvements
• Will install 133,400 lineal feet of water mains and 80 new fire hydrants
• Projects will reduce water loss and improve service reliability
• First PUC-regulated water utility to use PENNVEST's ProFi program
• Obtained nearly $115 million in grants and low-interest loans over the past 3 years

Negative

• None.

Financial Analyst

Aqua Pennsylvania's recent securing of $77.5 million in low-interest loans has several important implications for investors. Firstly, this move is likely to enhance the company’s financial stability by reducing its overall borrowing costs. Low-interest loans improve cash flow and allow the company to allocate resources more efficiently.

From a financial perspective, the company has positioned itself to address infrastructure challenges without significantly impacting its balance sheet. The ability to access funding through PENNVEST’s Programmatic Financing (ProFi) program is noteworthy since it offers a more flexible financial strategy compared to traditional project-specific lending. This could potentially result in cost savings in the long run and improve the company's financial health.

For retail investors, it’s vital to understand that infrastructure investments generally provide long-term benefits. While the immediate financial impact may seem minimal, the long-term gains include reduced maintenance costs, better service reliability and customer satisfaction, all of which can contribute positively to the company's future financial performance. Investors should, however, monitor the execution of these projects to ensure that promised efficiencies are realized.

Market Research Analyst

The announcement that Aqua Pennsylvania has secured substantial low-interest loans for infrastructure improvement is significant for the market. The replacement of 133,400 feet of water mains and installation of new fire hydrants indicate a strong commitment to enhancing service reliability and infrastructure. This is especially important as the company operates in highly populated counties such as Bucks, Montgomery, Delaware and Chester.

Market-wise, such improvements can enhance the company’s reputation and potentially increase its customer base, leading to higher revenues. Additionally, by explicitly targeting areas with older infrastructure, the company mitigates the risk of service disruptions which enhances customer satisfaction and loyalty. In the long run, these investments can also lead to better regulatory relations, as the company demonstrates proactive measures in maintaining and upgrading its systems. This could translate into fewer compliance issues and even potential incentives from regulatory bodies.

For investors, this represents a strategic move by Aqua Pennsylvania to strengthen its market position and ensure long-term sustainability. It’s essential to keep an eye on the coverage and customer feedback in these regions post-implementation, as it could provide insights into the market’s reception of these upgrades.

Infrastructure Expert

The low-interest loans secured by Aqua Pennsylvania for upgrading water mains and installing new fire hydrants reflect a critical investment in aging infrastructure. This is particularly important in regions like Pennsylvania, where some water systems date back decades. The replacement of old pipes with more durable materials reduces the likelihood of breaks and leaks, which can be disruptive and costly.

From an infrastructure standpoint, using modern materials can significantly enhance the resilience and efficiency of the water supply system. The new installations are likely to reduce the frequency and severity of service disruptions, which not only improves customer satisfaction but also lessens repair costs over time. Furthermore, the installation of new fire hydrants enhances public safety, an added benefit that should not be overlooked.

For investors, these improvements signify a forward-thinking approach to asset management. While the immediate financial impacts may be subtle, the long-term benefits of reduced operational interruptions and maintenance costs could be substantial. Investors should view this as a positive indicator of the company’s commitment to sustainability and service quality.

Company has been awarded nearly $115 million in low-interest loans and grants from PENNVEST in the past 3-years

BRYN MAWR, Pa.--(BUSINESS WIRE)-- Aqua Pennsylvania announced today it secured low-interest loan funding through the Pennsylvania Infrastructure Investment Authority (PENNVEST) to support its ongoing commitment to replace aging infrastructure across Pennsylvania. The $77.5 million in funding will support 21 projects to install new and replace aging water mains and fire hydrants over the next three years, resulting in reduced water loss due to leaks and breaks, and improved service and reliability for tens of thousands of customers in Bucks, Montgomery, Delaware and Chester Counties. These projects will be funded by PENNVEST’s Programmatic Financing (ProFi) program, which allows utilities to seek funding based on annual or multi-year projects, rather than the traditional project-specific lending strategy. Aqua Pennsylvania is the first Pennsylvania Public Utility Commission-regulated water utility to secure funding through the ProFi program.

“These projects will serve our customers for generations to come. With some pipes in our state dating back decades, this essential work assists in our commitment to provide the highest quality of service for our customers today and well into the future,” said Aqua Pennsylvania President Marc Lucca.

These projects replace and add 133,400 lineal feet of water mains with more durable, modern materials, reducing the likelihood of main breaks and increasing system reliability in more than a dozen communities served by Aqua Pennsylvania. Improvements include replacing aging pipes in poor condition or those having a history of leaks. The projects also improve public safety with the installation of approximately 80 new fire hydrants.

The water main replacements will positively impact customers in the following communities:

DELAWARE COUNTY

• Aldan Borough, Haverford Township, Marple Township, Nether Providence Township, Springfield Township and Upper Darby Township

BUCKS COUNTY

• Bensalem Township, Lower Southampton Township and Warminster Township

MONTGOMERY COUNTY

• Collegeville Borough, Hatboro Borough, Lower Merion Township and Perkiomen Township

CHESTER COUNTY

• Tredyffrin Township, Uwchlan Township and West Bradford Township

“I am extremely proud of the Aqua Pennsylvania team who diligently identified and pursued this funding. These low-interest loans allow us to efficiently complete this work for our customers,” said Lucca. “I want to specifically thank PENNVEST for their assistance in securing these funds.”

With this $77.5 Million in funding, Aqua Pennsylvania has now secured nearly $115 million in grants and low-interest loans for projects across the Commonwealth. Aqua Pennsylvania will continue to seek these funding opportunities as part of its commitment to exemplary service and affordability.

About Aqua Pennsylvania

Aqua Pennsylvania provides water and wastewater service to approximately 1.5 million people in 32 counties throughout the Commonwealth of Pennsylvania. Visit AquaWater.com for more information or follow @MyAquaWater on Facebook and @MyAquaWater on X.

About Essential

Essential Utilities, Inc. (NYSE: WTRG) delivers safe, clean, reliable services that improve quality of life for individuals, families, and entire communities. With a focus on water, wastewater and natural gas, Essential is committed to sustainable growth, operational excellence, a superior customer experience, and premier employer status. We are advocates for the communities we serve and are dedicated stewards of natural lands, protecting more than 7,600 acres of forests and other habitats throughout our footprint.

Operating as the Aqua and Peoples brands, Essential serves approximately 5.5 million people across nine states. Essential is one of the most significant publicly traded water, wastewater service and natural gas providers in the U.S. Learn more at www.essential.co.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which generally include words such as “believes,” “expects,” “intends,” “anticipates,” “estimates” and similar expressions. The Company can give no assurance that any actual or future results or events discussed in these statements will be achieved. Any forward-looking statements represent its views only as of today and should not be relied upon as representing its views as of any subsequent date. Readers are cautioned that such forward-looking statements are subject to a variety of risks and uncertainties that could cause the Company’s actual results to differ materially from the statements contained in this release. Such forward-looking statements include, but are not limited to, statements relating to the capital to be invested in the Company’s water infrastructure, the number and type of projects the Company will undertake, and that it will continue to seek and receive grants and low-interest loans. There are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements including the factors discussed in the Company’s Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q, which are filed with the Securities and Exchange Commission. For more information regarding risks and uncertainties associated with the Company’s business, please refer to the Company’s annual, quarterly and other SEC filings. The Company is not under any obligation - and expressly disclaims any such obligation - to update or alter its forward-looking statements whether as a result of new information, future events or otherwise.

WTRGG

View source version on businesswire.com: https://www.businesswire.com/news/home/20240717397994/en/

Media:

Patrick Wenger

Aqua Communications Manager

O: 610.645.1175

PMWenger@aquawater.com

Source: Essential Utilities, Inc.

FAQ

How much funding did Aqua Pennsylvania (WTRG) secure from PENNVEST for infrastructure projects?

Aqua Pennsylvania secured $77.5 million in low-interest loans from PENNVEST for infrastructure projects across Pennsylvania.

What will the PENNVEST funding be used for by Aqua Pennsylvania (WTRG)?

The funding will be used to install 133,400 lineal feet of water mains and approximately 80 new fire hydrants over the next three years in various Pennsylvania counties.

Which counties will benefit from Aqua Pennsylvania's (WTRG) infrastructure projects?

The infrastructure projects will benefit customers in Bucks, Montgomery, Delaware, and Chester Counties in Pennsylvania.

How much has Aqua Pennsylvania (WTRG) secured in grants and low-interest loans over the past three years?

Aqua Pennsylvania has secured nearly $115 million in grants and low-interest loans for projects across Pennsylvania over the past three years.