Water and wastewater management company
The York Water Company
) filed for a rate hike with the Pennsylvania Public Utility
Commission (PPUC). The filing is for an annual increase in the
water rate by $7.1 million and a general increase in wastewater
rates for the Asbury Pointe Subdivision to $27,960 per year.
The filing for higher rates aims to recover the $49 million
invested by York Water Company in York and Adams counties since
its 2010 rate filing.
If the new rates are approved entirely a typical residential
water customer would pay an additional $5.69 per month, a typical
commercial water customer would pay an additional $ 20.90 per
month and the typical industrial water customer would pay an
additional $142.71 per month. An Asbury Pointe Subdivision
wastewater customer would pay an additional $10.00 per month.
If the rates are granted immediately, it would come into effect
from Aug 1, 2013. Even with the new rates, the average cost of
1,000 gallons of water would continue to remain below a penny per
gallon. However, the PPUC can delay the implementation of the
rates till Mar 14. The federal body can also conduct an
investigation and can partially approve the rate hike.
The rate hike will provide the necessary funds to the company to
reinforce and replace aging water mains. York Water Company also
plans to expand and improve the water and wastewater treatment
plants and other facilities.
This improvement will allow it to meet current and upcoming
water regulation. On implementation of the new rates, the company
will replace over 30 miles of aging pipeline, comprising nearly
3% of its total pipeline. This replacement will increase the
efficiency and reliability of its service.
Water utilities in general are facing a funding crunch, as the
investments in infrastructure improvement are presently lower
than the required amount. This funding gap has widened since the
economic slowdown. As per American Water Works Association,
the maintenance and replacement of outdated water systems in the
U.S. will cost at least $1 trillion over the next 25 years.
Water utilities are investing in the repair and improvement of
water infrastructure. A unit of
American Water Works Company
) has invested about $330 million in water and wastewater system
improvements across Illinois in the 2009 to 2013 period.
The 2013 capital budget of the water utility
Connecticut Water Service Inc.
) includes $31.3 million for infrastructure investment. Even
these investments appear negligible in comparison to the total
requirement. However, the consistent outlay of funds will
gradually bridge the funding gap.
AMER WATER WORK (AWK): Free Stock Analysis
CONN WATER SVC (CTWS): Free Stock Analysis
AQUA AMER INC (WTR): Free Stock Analysis
YORK WATER CO (YORW): Free Stock Analysis
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The York Water Company currently has a Zacks Rank #2 (Buy).
Another water utility
Aqua America Inc.
) is also performing well with a comparable Zacks Rank #2