On April 1, 2020, New York American Water customers will see an increase in rates because of a four-year rate plan approved by the New York State Public Service Commission (PSC) in 2017. The rate increase, which begins the fourth year of the rate plan, is principally a result of the cost recovery of approximately $130 million of capital investments New York American Water has or will make over the life of the plan, ending March 31, 2021.
As part of the four-year rate plan, a conservation rate structure was implemented in 2017 in accordance with the PSC support of the long-term sustainability of the Long Island Aquifer. The New York State Department of Environmental Conservation (DEC) established a goal for all Long Island water suppliers to reduce summertime peak water use by 15 percent by 2021. In the conservation rate structure approved by the PSC, water usage charges are based on an inclining block structure, meaning the more water customers use, the more they pay per gallon. New York American Water’s conservation rate structure coupled with the company’s new Advanced Metering Infrastructure (AMI) meter replacement program, outlined below, and H2O Control Conservation Program is designed to assist customers in reducing their water use to help meet the DEC goal. Long-term water conservation is also in the best interest of the customer as it allows New York American Water to defer or reduce investment to build additional treatment facilities and other infrastructure.
New York American Water is committed to educating customers about their water use while offering them tips, tools and technology to conserve. To this end, New York American Water will be implementing AMI as a part of its H2O Control Toolbox to benefit customers, starting in spring 2020.
“Our focus at New York American Water is to put the interests of our customers first. This is why our company recently undertook a comprehensive analysis of AMI ahead of implementation to ensure that the change to this advanced technology will allow us to operate more efficiently and reduce long-term costs. Roll out of AMI will include customer engagement to ensure our customers take advantage of what AMI has to offer and feel empowered to control their water use to protect the long-term sustainability of their aquifer,” stated Lynda DiMenna, President of New York American Water. “We understand the effect of increasing rates on our customers, which is why we are taking proactive steps to provide them with educational and effective tools to curb water use ahead of the peak water use months of summer.”
AMI is being introduced in New York American Water’s H2O Control Toolbox
Established in 2019, the H2O Control Conservation Program provides customers with tips, tools and technology to empower them to control their water bills. In addition to the existing tools within the company’s H2O Control Toolbox, AMI will now be introduced to customers. The benefits of AMI include:
- Near real-time data on water usage;
- Improved billing accuracy;
- Increases data access and transparency;
- Eliminates the need for manual meter reading; and
- Automatically reports leaks and high usage.
All customers will be receiving communication from New York American Water about the required meter change to AMI and how to make an appointment. New York American Water will replace all meters across its service areas starting in spring 2020, through the end of 2025.
More information about AMI and the H2O Control Toolbox is available on the New York American Water website under Conservation.
Rates are based on the cost of providing water service to customers, including investments to improve the water treatment and delivery system. In the company’s Long Island service areas, local property taxes are a significant portion of customers’ water bills, accounting for between 31 percent and 55 percent of the total water bill, depending on service area. Private water utilities are required to pay property taxes. While these taxes cause bills to be higher, the dollars go right back into the community to fund public services, such as schools, police, fire and other county, town and village operations.
The remaining balance of customer bills includes a fixed water service charge and a consumption-based water usage charge, which is based on a four-tier conservation rate structure. The water usage charge represents the cost related to operating and maintaining source of supply, pumping, treatment, and transmission and distribution facilities, as well as capital costs related to upgrading these facilities.
New York American Water customers use an average of 8,000 gallons per month (which places the average customer in Tier 3 of the rate structure). Rates effective April 1, 2020, for each of the company’s service areas are as follows:
- Service Area 1 (Lynbrook): For residential customers using 8,000 gallons per month, the bill would change from $66.24 to $70.13 for Rate Year Four.
- Service Area 2 – South Shore (Merrick): For residential customers using 8,000 gallons per month, the bill would change from $50.25 to $53.15 for Rate Year Four.
- Service Area 2 - North Shore (Sea Cliff): For residential customers using 8,000 gallons per month, the bill would change from $76.89 to $80.35 for Rate Year Four.
Beginning April 1, residential water rates in Service Area 2 – North and South Shore will include an inclining fourth tier, and customers that use over 15,000 gallons of water a month will be billed at the highest rate.
- For a Service Area 2 – South Shore customer who uses 20,000 gallons in a month, their bill will increase from $129.94 to $139.97 in Rate Year Four.
- For a Service Area 2 – North Shore customer who uses 20,000 gallons in a month, their bill will increase from $196.49 to $207.91 in Rate Year Four.
New York American Water strongly encourages all customers to use the company’s H2O Control Toolbox to keep water use within the lower tiers which allows customers to pay less per gallon.
The rate plan, which was designed to spread increases equally over a four-year period for both Service Areas 1 and 2, included deferrals of rate increases in Rate Year One and Two. Those deferrals, which would have been collected as a “Levelization Surcharge” in Rate Year Three and Four, were re-evaluated for Service Area 1 and not implemented in Rate Year Three or Four.
The new rates and descriptions for each service area are posted on the New York American Water website under Customer Service & Billing, Your Water Rates. Customers will receive additional information regarding rate details and AMI in a mailing from New York American Water this month.
New York American Water, a subsidiary of American Water (NYSE: AWK), is the largest investor-owned water company in New York, providing high-quality and reliable water and/or wastewater services to approximately 350,000 people.
With a history dating back to 1886, American Water is the largest and most geographically diverse U.S. publicly traded water and wastewater utility company. The company employs more than 6,800 dedicated professionals who provide regulated and market-based drinking water, wastewater and other related services to 15 million people in 46 states. American Water provides safe, clean, affordable and reliable water services to our customers to make sure we keep their lives flowing.