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Water Utilities Reduce Customers Bills, Passing on Savings from Federal Tax Reform


Pennsylvania - Penn's Northeast member, Pennsylvania American Water announced today that most of its water and wastewater customers will start seeing lower monthly bills as a result of the federal Tax Cuts and Jobs Act of 2017.


Starting July 1, 2018, the decrease will appear on customers’ bills as the “Fed Tax Adjust Surcharge” to reflect the company’s reduced tax expense. For customers who receive both water and wastewater service from Pennsylvania American Water, their monthly bills will reflect a credit for each. Pennsylvania American has 650,000 water customers in 400 communities


On May 17, 2018, the Pennsylvania Public Utility Commission (PUC) issued an order directing 17 electric, natural gas, and water and wastewater utilities, including Pennsylvania American Water, to implement a “negative surcharge” or monthly credit on customer bills. The PUC’s order cited decreased federal corporate tax rates and other tax changes under the Tax Cuts and Jobs Act of 2017, which impacted the tax liability of many utilities. The PUC projected the savings for the utilities’ customers at more than $320 million per year.


Last month, Penn's Northeast members UGI Penn Natural Gas announced its monthly bills will drop by an average of $2.01 because of the Tax Cuts and Jobs Act of 2017. PPL Electric Utilities said its customers’ monthly bills will decrease by about $3.50 for the typical residential customer who uses 1,000 kilowatt-hours per month.


More than a dozen major electric, natural gas, water and wastewater utilities have begun issuing monthly bill credits under the PUC’s May 17 order over the tax matter. The order required utilities to refund about $320 million to consumers. They include PPL Electric Utilities, UGI Utilities and Met-Ed. The bill decreases for customers range from UGI’s 5.8 percent to Met-Ed’s 8.6 percent


“The reduced tax expense amounts to approximately $47 million annually for our company,” said President Jeffrey L. McIntyre of Pennsylvania American Water, “so we are following the PUC’s directive and passing the savings to our customers.”


Water: Nearly 6.8 percent decrease for most customers. For example, a water customer who typically uses 3,000 gallons per month will see $3.61 savings, or $43.32 per year. For water customers who typically use 5,000 gallons per month, the savings will be $5.27, or $63.24 per year.

Wastewater: Nearly 7.7 percent decrease for most customers. For example, a wastewater customer who typically uses 3,000 gallons per month will see $4.25 savings, or $51 per year. For wastewater customers who typically use 5,000 gallons per month, the savings will be $6.58, or $78.96 per year. (Reductions for Scranton and Dunmore wastewater customers and New Cumberland wastewater customers are slightly less due to the lower rates established in the company’s most recent rate filing last year.)


McIntyre said customers will continue to receive the federal tax adjustment until Pennsylvania American Water files for and receives approval from the PUC on its next base rate case.


You can also access video of McIntyre’s comments about the impact of the federal tax adjustment at


Pennsylvania American Water, a subsidiary of American Water (NYSE: AWK), is the largest investor-owned water utility in the state, providing high-quality and reliable water and/or wastewater services to approximately 2.4 million 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 6,900 dedicated professionals who provide regulated and market-based drinking water, wastewater and other related services to an estimated 15 million people in 46 states and Ontario, Canada.


American Water provides safe, clean, affordable and reliable water services to our customers to make sure we keep their lives flowing. For more information, visit and follow American Water on TwitterFacebook and LinkedIn.


Pennsylvania American Water
Eastern/Central Pennsylvania:

Terry Maenza
T: 610-670-7789 ext. 1009
M: 610-849-6484

Western Pennsylvania:
Gary Lobaugh
T: 724-873-3674
M: 724-944-5148

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