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Kentucky American Water Seeks Rate Increase for Infrastructure Upgrades

Visual representation of water infrastructure improvements in Kentucky

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News Summary

Kentucky American Water has filed a request with the PSC for a $26.9 million rate increase to support over $212 million in necessary infrastructure improvements. The upgrades aim to replace aging water pipelines and enhance water service reliability for over 500,000 residents in 13 counties. If approved, the average residential bill may increase by about $9 per month. The PSC will review the request, with a decision expected in the next 10 months, during which interim rates may be set. Public engagement and customer support initiatives remain central to the process.

Lexington, Kentucky – Kentucky American Water has officially filed a request with the Kentucky Public Service Commission (PSC) for a significant rate increase of approximately $26.9 million. This proposed increase is aimed at funding over $212 million in essential infrastructure upgrades meant to enhance water services for over 500,000 residents across 13 counties.

The primary focus of these upgrades includes the replacement of 30 miles of aging water pipelines, as well as improvements to storage tanks, hydrants, pumps, meters, and various other water system components. These improvements are critical for maintaining safe and reliable water service in compliance with state and federal environmental regulations.

Should the PSC approve the proposed rate increase, the average residential customer’s monthly bill—based on an average usage of 3,900 gallons—would see an increase of about $9. This adjustment reflects the utility’s investment in enhancing the infrastructure necessary for consistent service delivery.

The PSC is set to review the rate increase request thoroughly, with a final decision expected within the next 10 months. During this review period, interim rates may be implemented in approximately seven months, allowing the utility to begin its infrastructure work while the PSC continues deliberation. Notably, if the final approved rates diverge from the interim figures, customers may be eligible for refunds to adjust for the difference.

Kentucky American Water underscores the significance of these infrastructure investments, which are essential not just for service reliability but also for adhering to environmental standards aimed at safeguarding public health. The importance of these upgrades comes into sharper focus considering that the last general rate case filed by the utility was in June 2023, indicating an urgent need for sustainable investment.

This rate increase proposal is subject to extensive public scrutiny, with reviews involving the Attorney General’s Office and local government entities. Public engagement has historically played a central role in ensuring that customer concerns and interests are considered in utility rate decisions.

Moreover, Kentucky American Water also provides assistance programs for struggling customers. These initiatives include flexible payment plans and budget billing options designed to help customers manage their water bills more effectively. This commitment to customer support remains vital for ensuring that essential water services remain accessible, especially during times of financial hardship.

In summary, Kentucky American Water is working to secure a substantial rate increase to fund critical infrastructure upgrades aimed at maintaining the quality and safety of water services for hundreds of thousands of residents in Kentucky. The PSC’s decision on this rate increase will be pivotal in determining the future of the utility’s investment in its water infrastructure and the overall impact on customer bills.