Aqua North Carolina, the state’s biggest non-municipal water utility, is seeking its second rate increase under a new state policy that allows small rate increases without public hearings.
While the new rate requests are relatively small, Aqua already charges about twice as much as municipal water systems in Raleigh, Durham, Cary and other cities. Aqua’s 750 water systems and 62 treatment plants in North Carolina are collectively larger than a small town, totaling 92,500 customers and more than 400 subdivisions in Wake County alone.
The Cary-based company told the N.C. Utilities Commission it wants to recover $2 million for 18 projects on its water and sewer systems. The increases, if approved, would add 14 cents a month to a typical water customer in the Triangle and 43 cents a month to a typical sewer customer here, Aqua said in its filing.
Aqua told the Utilities Commission it plans to spend $26.1 million on system improvements over then next three years. The company intends to ask for rate hikes every six months for the foreseeable future, said Tom Roberts, president and chief operating officer.
“The goal is to fix the problems in the system and we’re always investing money,” Roberts said.
If approved by the Utilities Commission, the rate increases would be effective July 1. The request is under review by the Public Staff, the state agency that represents utility customers. The Public Staff typically recommends a fraction of Aqua’s requests and the Utilities Commission slashes the company’s original request.
David Furr, the Public Staff’s water division director, said his staff is scrutinizing excessive and improper charges in Aqua’s proposed rate request, but said rate increases every six months can have their benefits.
It provides incentives for “them to do things they might otherwise put off,” Furr said. “They can do projects and they can start recovering those investments.”
The 18 projects include replacement of pumps, motors, meters and other equipment.
Most of Aqua’s customers in the state, including those in the Triangle, are under Aqua NC Water and Aqua NC Sewer. Aqua is seeking a 0.30 percent water increase and a 0.66 percent sewer increase.
In Aqua’s first rate request under the new policy last year, the Utilities Commission approved less than half the rate increase Aqua sought. That rate increase went into effect Jan. 1.
Sixteen states, including North Carolina, have policies allowing water utilities to raise rates under limited circumstances without public hearings. The rate policy here was adopted by the Utilities Commission in June 2014, allowing Aqua to raise rates up to 5 percent between full rate cases with public hearings.
Attorney General Roy Cooper challenged the policy at the N.C. Supreme Court, contending it harmed the public. That case was argued in March and the justices are expected to rule in the coming months. If the court agrees with Cooper, it would likely kick the rate policy back to the Utilities Commission with directions to explain its benefit to the public.