Connecticut Water Company Asks to Lower Customer Bills

April 30, 2009
The Connecticut Water Company (CWC) has filed an application with Connecticut's Department of Public Utility Control for permission to reduce customers' water bills for the last six months of 2009. CWC is proposing to place a temporary credit on customer bills from July 1 to December 31, 2009, and delay its next rate case filing.

CLINTON, Conn., April 30, 2009 -- The Connecticut Water Company (CWC) has filed an application with Connecticut's Department of Public Utility Control (DPUC) for permission to reduce customers' water bills for the last six months of 2009. CWC is a regulated public water utility with more than 88,000 customers, or about 300,000 people in the state of Connecticut, and is a subsidiary of Connecticut Water Service. CWC is proposing to place a temporary credit on customer bills from July 1 to December 31, 2009, and delay its next rate case filing.

According to Connecticut Water's President and CEO, Eric W. Thornburg, the Company is sensitive to the challenges facing its customers and lowering customer bills is the right thing to do.

"The current economy is widely accepted as the most challenging in recent times and Connecticut Water recognized the need to take unprecedented action -- voluntarily proposing to reduce customer bills for six months and delaying the company's next rate filing until January 2010," Thornburg said. "It typically takes about six months for a rate proceeding, so it is unlikely that new rates would go into effect until the second-half of 2010. Our goal is to help our customers without affecting service quality and sustainability."

The proposed credit on bills would equal 1.8 percent of a customer's bill for water usage and all residential, commercial, industrial, and municipal customers would benefit from the credit.

The proposal to temporarily credit bills and delay the next rate case filing is based on adjusting certain depreciation rates and passing along the expense reduction to customers and requires DPUC approval.

Depreciation allows the company to recover the original cost of infrastructure over its useful life, and by extending the assumed useful life of infrastructure depreciation costs can be spread over more years thereby reducing the annual expense. The proposed credit will not have an impact on the company's earnings in 2009 because the temporary credit is being offset by a reduced expense.

After the temporary credit is eliminated on December 31, 2009, the Company will use the reduced depreciation expense to delay its next rate case filing. Under the terms of the settlement agreement in the company's last rate case, CWC cannot seek implementation of higher customer rates prior to January 1, 2010. The company is now proposing to extend the stay out period for six additional months to July 1, 2010. The company plans to file its next rate case early in 2010 with new rates going into effect after July 1, 2010. This would delay the general rate increase until the following fiscal year for municipalities.

The timing of a temporary credit on customers' bills would coincide with the addition of a Water Infrastructure Conservation Adjustment (WICA) surcharge on the bills. The proposed credit however, would more than fully offset the amount of the infrastructure surcharge in 2009.

Sponsored Recommendations

ArmorBlock 5000: Boost Automation Efficiency

April 25, 2024
Discover the transformative benefits of leveraging a scalable On-Machine I/O to improve flexibility, enhance reliability and streamline operations.

Rising Cyber Threats and the Impact on Risk and Resiliency Operations

April 25, 2024
The world of manufacturing is changing, and Generative AI is one of the many change agents. The 2024 State of Smart Manufacturing Report takes a deep dive into how Generative ...

State of Smart Manufacturing Report Series

April 25, 2024
The world of manufacturing is changing, and Generative AI is one of the many change agents. The 2024 State of Smart Manufacturing Report takes a deep dive into how Generative ...

SmartSights WIN-911 Alarm Notification Software Enables Faster Response

March 15, 2024
Alarm notification software enables faster response for customers, keeping production on track