Tennessee American Water files rate increase

Investments in local water infrastructure drive request; cost of local drinking water service remains less than a penny per gallon

Chattanooga, Tenn. – Tennessee American Water filed a general rate case application with the Tennessee Regulatory Authority (TRA) requesting an increase in drinking water rates for customers in the company’s Chattanooga, Lookout Mountain, Lakeview, Suck Creek and Lone Oak service areas.

Tennessee American Water’s ongoing investment in local water infrastructure to renew and replace water treatment facilities, pumps and pipelines is one of the main drivers for the rate request. This filing covers local water infrastructure investments of an estimated $13.3 million.

In Chattanooga, the monthly water bill for an average residential customer (4,153 gallons per month) today is less than $20.00 per month.

The United States EPA says the nation’s water utilities will need to make more than $355 billion in infrastructure investments over the next 20 years to replace thousands of miles of pipe and for upgrades to treatment plants, storage tanks and other assets to ensure public health. According to the American Society of Civil Engineers, Tennessee’s (entire state) drinking water infrastructure needs an investment of $2.77 billion over the next 20 years.

If the new rates are approved as requested, they would generate approximately $10.5 million in additional revenue for the company. The process, which will include public input, takes about six months.
Any increase granted by the TRA in would be effective December 2012.
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