NJ American Water Gets $100M Rate Hike Approval

TL;DR

NJ American Water just got approved for a $100M annual revenue increase from regulators.

AI Summary

On September 4, 2024, American Water Works Company, Inc. announced that its subsidiary, New Jersey American Water, received a final order from the New Jersey Board of Public Utilities regarding its general rate case. This order allows for an annual revenue increase of approximately $100 million, effective September 1, 2024, with a partial increase of $50 million effective September 1, 2025.

Why It Matters

This rate increase will allow New Jersey American Water to recover costs and invest in infrastructure improvements, potentially leading to better service and reliability for its customers.

Risk Assessment

Risk Level: low — The filing is an informational update on a regulatory decision that has already been made and is generally expected by investors.

Key Numbers

• $100 million — Annual Revenue Increase (Approved by NJ BPU for New Jersey American Water.)
• $50 million — Partial Annual Revenue Increase (Effective September 1, 2025, as part of the rate case order.)

Key Players & Entities

• American Water Works Company, Inc. (company) — Registrant
• New Jersey American Water (company) — Subsidiary
• New Jersey Board of Public Utilities (company) — Regulator
• $100 million (dollar_amount) — Annual revenue increase
• $50 million (dollar_amount) — Partial annual revenue increase
• September 4, 2024 (date) — Filing date
• September 1, 2024 (date) — Effective date of revenue increase
• September 1, 2025 (date) — Effective date of partial revenue increase

FAQ

Key Financial Figures

• $0.01 — ich Registered Common stock, par value $0.01 per share AWK New York Stock Exchange
• $161.7 million — (the "Company"), seeking approximately $161.7 million of increased annualized water and waste
• $79.5 million — n of Rate Counsel. The Order approves a $79.5 million annualized increase in New Jersey Ameri
• $5.05 billion — f 9.6%, (ii) an authorized rate base of $5.05 billion , (iii) a common equity ratio of 55.00%
• $4.15 b — ed ROE of 9.6%, authorized rate base of $4.15 billion, a common equity ratio of 54.56%
• $1.3 billion — revenue increase is driven primarily by $1.3 billion of incremental capital investments sinc

Filing Documents

• awk-20240904.htm (8-K) — 31KB
• ex991-njawc2024ratecaseord.htm (EX-99.1) — 9KB
• njawcheader.jpg (GRAPHIC) — 80KB
• image.jpg (GRAPHIC) — 93KB
• 0001410636-24-000162.txt ( ) — 431KB
• awk-20240904.xsd (EX-101.SCH) — 2KB
• awk-20240904_def.xml (EX-101.DEF) — 14KB
• awk-20240904_lab.xml (EX-101.LAB) — 25KB
• awk-20240904_pre.xml (EX-101.PRE) — 15KB
• awk-20240904_htm.xml (XML) — 3KB

01. Other Events

Item 8.01. Other Events. New Jersey Board of Public Utilities ("NJBPU") Approval of Settlement in New Jersey-American Water Company, Inc. ("New Jersey American Water") General Rate Case On September 4, 2024, the NJBPU issued an order (the "Order") approving without modification the stipulation of settlement (the "Stipulation") of a general rate case filed on January 19, 2024 by New Jersey American Water, a wholly owned subsidiary of American Water Works Company, Inc. (the "Company"), seeking approximately $161.7 million of increased annualized water and wastewater revenues. The Stipulation was entered into on August 12, 2024 with the staff of the NJBPU and the New Jersey Division of Rate Counsel. The Order approves a $79.5 million annualized increase in New Jersey American Water's water and wastewater revenues, effective as of September 15, 2024, based on (i) an authorized return on equity ("ROE") of 9.6%, (ii) an authorized rate base of $5.05 billion , (iii) a common equity ratio of 55.00%, and (iv) a long-term debt ratio of 45.00%, compared to an authorized ROE of 9.6%, authorized rate base of $4.15 billion, a common equity ratio of 54.56% and a long-term debt ratio of 45.44%, all as approved in New Jersey American Water's last general rate case in 2022. The annualized revenue increase is driven primarily by $1.3 billion of incremental capital investments since that last general rate case. New Jersey American Water will continue to defer as a regulatory asset or liability, as appropriate, until its next general rate case, the difference between its pension expense and other post-employment benefits (OPEB) expense and those amounts included in base rates. A copy of the press release issued by New Jersey American Water on September 4, 2024 to announce the issuance of the Order has been filed as Exhibit 99.1 hereto and is incorporated herein by reference. References and links to websites and other information contained in this press release are not provided as act

01. Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits. (d) Exhibits. The following exhibits to this Current Report have been provided herewith as noted below: Exhibit No. Description 99.1* Press Release, dated September 4, 2024, issued by New Jersey American Water. 104 Cover Page Interactive Data File (the cover page XBRL tags are included and formatted as Inline XBRL). * Filed herewith. 2

SIGNATURES

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. AMERICAN WATER WORKS COMPANY, INC. Dated: September 4, 2024 By: /s/ DAVID M. BOWLER David M. Bowler Executive Vice President and Chief Financial Officer 3

View Full Filing

View this 8-K filing on SEC EDGAR