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Publish Date : 07-Oct-2013

Tennessee American Water today filed a request with the Tennessee Regulatory Authority (TRA) for three riders and an expense tracker that, if approved, collectively covers approximately $7.5 million in local water infrastructure improvements that the company has made or will make in 2014.

Today’s filing is the first of its kind by Tennessee American Water. According to company officials, today’s filing is the implementation of new state legislation passed by the Tennessee General Assembly. The new law encourages the TRA to consider alternative rate mechanisms to ensure continued reliability and quality of service, as well as to promot local economic development. According to Deron Allen, president, Tennessee American Water, similar alternative rate mechanisms have been used in other states to encourage ongoing infrastructure replacement (pipes, pumps, hydrants, etc) at necessary levels while holding down the overall costs for the filing and administration of general rate cases with state commissions.

“We’re proud of the reliability and quality of the water system serving Chattanooga and local communities,” said Allen. “Our goal is to keep the water system strong and viable today and for generations to come. Ignoring the infrastructure needs of our water system, over time, would be a disservice to our customers and community.”Communities across the country are facing challenges of operating aging water infrastructure and the need to increase rates to fund critical improvements. According to the American Society of Civil Engineers 2013 Report Card, communities throughout Tennessee collectively will need to spend approximately $3.5 billion during the next 20 years to renew and replace their water infrastructure needs.

Allen said the goal of the filing for new riders and an expense tracker is to allow Tennessee American Water to continue making necessary investments in the local water system’s infrastructure with minimal impact to customers’ rates. The average total impact for a residential customer in Chattanooga, as proposed, would be approximately 24 cents per month for all three riders and expense tracker combined, or less than $3 per year total. If approved by the TRA, the cost for local drinking water service will remain less than a penny per gallon. The average monthly bill for a residential customer in Chattanooga today is $21.56 (based on 4.154 gallons used per month).

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