Illinois Commerce Commission Approves New Rates for Illinois American Water, Reflecting System Upgrades and Investments
The Illinois Commerce Commission (ICC) has approved a rate increase for Illinois American Water, effective January 1, 2025. This decision follows a request filed on January 25, 2024, and is driven by significant investments in the water and wastewater infrastructure across the state, totaling approximately $557 million for 2024 and 2025. The rate hike is part of the company’s ongoing efforts to upgrade and maintain its water and wastewater systems to ensure safe, reliable service for Illinois communities.
Key Drivers of the Rate Increase
The new rates will support critical infrastructure improvements across Illinois American Water’s system. Rebecca Losli, President of Illinois American Water, emphasized the company’s commitment to maintaining and upgrading its infrastructure. “By making prudent, ongoing necessary investments to maintain and upgrade our water and wastewater systems, Illinois American Water is committed to the safety and reliability of our water and wastewater systems in the communities we serve,” Losli stated.
This rate change is mainly driven by the company’s planned investment of $557 million in infrastructure projects. These improvements include the replacement, lining, and installation of approximately 44 miles of aging water and wastewater pipelines, as well as upgrades to treatment plants, storage tanks, wells, pumping stations, fire hydrants, meters, and manholes. Additionally, the company will continue its efforts to replace customer lead service lines, ensuring compliance with environmental regulations and enhancing the overall quality of service.
Investments in Water and Wastewater Infrastructure
The approved rate order covers a total of $557 million in capital investments over the next two years, including $421 million for water system improvements and $136 million for wastewater system upgrades. These investments will occur between January 2024 and December 2025, reflecting a continued focus on modernizing infrastructure to meet the growing needs of Illinois communities and ensure the systems remain safe and reliable for years to come.
One of the key components of these investments is the replacement and improvement of approximately 44 miles of outdated pipelines. These aging pipes, which date back several decades, are critical to the efficient delivery of water and wastewater services. Modernizing these systems will reduce the risk of leaks, service interruptions, and other operational issues that could impact customers.
Moreover, Illinois American Water is upgrading its water and wastewater treatment plants to meet the evolving regulatory standards and improve water quality. The company is also addressing other essential infrastructure elements such as fire hydrants, pumping stations, and manholes, all of which are integral to ensuring uninterrupted service and public safety.
Impact on Customers
The rate increase will vary depending on the customer’s location and service usage. For a typical residential customer using 3,500 gallons of water per month with a 5/8-inch meter, the monthly water bill will increase by approximately $16. Additionally, the typical residential wastewater bill will see an increase of around $8.50 per month.
These increases will generate an annual revenue boost of approximately $110.6 million, which will be used to fund the necessary infrastructure investments and ensure the continued reliability of water and wastewater services throughout the state.
While the rate hikes will affect customers, Illinois American Water is making efforts to mitigate the financial impact on low-income households. The ICC has approved an expansion of the company’s income-based discount program, which will provide financial assistance to qualifying customers. Those eligible for the discount will need to apply and provide the required income information once the expanded program is implemented.
Customer Assistance Programs
In addition to the income-based discount program, Illinois American Water offers several other customer assistance programs to help manage bills. These programs include the non-income-based H2O Help to Others initiative, payment plans, and budget billing. These programs are designed to help customers manage their water and wastewater bills, particularly in times of financial hardship.
Customers interested in learning more about these programs or the upcoming rate changes can find additional information on Illinois American Water’s website. The company will also provide details about the new rates through customer bills, ensuring that all customers are informed of the changes and any available assistance options.
For further details about the new rates, customer assistance programs, or the income-based discount tariff, customers are encouraged to visit the company’s website at amwater.com/ilaw under the “Customer Service & Billing” section. Additionally, Illinois American Water will send notifications directly to customers’ bills to ensure they have the most up-to-date information regarding the changes.
