On January 16, 2026, New Jersey American Water, a subsidiary of American Water, filed a request with the New Jersey Board of Public Utilities to implement new rates that would fund over $1.4 billion in water and wastewater infrastructure investments through December 2026. The proposal underscores plans to modernize treatment plants, replace or rehabilitate nearly 120 miles of aging mains and accelerate lead service line removal. Management highlights that these upgrades are designed to bolster reliability, enhance water quality and protect public health for the 2.9 million customers served statewide.

If approved, average residential water customers would see an increase of approximately $10 per month, while typical sanitary wastewater customers would incur an $8 monthly rise. To mitigate affordability concerns, the company is seeking to expand eligibility for its H2O Help to Others assistance program by extending bill discounts to households already enrolled in energy assistance through LIHEAP and USF. Additional measures include budget billing options, flexible payment plans and outreach to income-eligible customers, positioning New Jersey American Water as the only utility in the state offering that level of support.

New Jersey American Water is also requesting regulatory approval to return savings from a Gross Receipts Tax refund directly to its customers. Under the proposal, the company would first apply the refund to offset certain regulatory expenses and then distribute the remaining balance through reduced future rates. Company leadership projects that this pass-back mechanism will keep overall rate pressure lower and ensure customers benefit from recent tax-related savings.

The requested rate changes will undergo an extensive review process by the New Jersey BPU, the Division of Rate Counsel and the Office of Administrative Law, including public hearings and evidentiary sessions expected to span at least nine months. Investors should note the timeline to final approval, which, if granted, would see new rates implemented in the second half of 2026. The outcome will influence American Water’s regulated revenue trajectory in New Jersey, its largest state subsidiary by customer count, and inform capital recovery on the $1.4 billion investment plan.