Newspaper article Charleston Gazette Mail

Lawyers Weigh in on Water Surcharge

Newspaper article Charleston Gazette Mail

Lawyers Weigh in on Water Surcharge

Article excerpt

Lawyers representing industrial and residential water customers have weighed in on a proposal to let West Virginia American Water assess a surcharge to customers for water main replacements. The West Virginia Energy Users Group, an association representing large manufacturers in front of the Public Service Commission, filed rebuttal testimony in American Water's ongoing rate case, urging the commission to reject the proposed plan to give the company a separate surcharge for infrastructure investment.

The PSC's Consumer Advocate Division has voiced tentative support for the plan, as long as several consumer protections are included.

The idea of letting the water company implement a surcharge that would pay to upgrade its failing transmission and distribution mains was proposed by the PSC staff in September. They argued that other attempts to encourage increased investment in the company's water system have not worked, and pointed to numerous problems in American Water's 4,100 miles of pipe.

"The distribution system is the backbone of the utility, the PSC staff testified, "and if one cannot move the water to the customer, the utility simply cannot meet its public service obligation to provide safe and adequate service at all times.

The PSC staff's recommendation to give American Water an infrastructure surcharge goes against its stance in a 2010 case, in which staff members classified the company's request for a surcharge as a "jackpot. In that instance, they asked the commission to reject the company's "gamesmanship.

Since then, American Water's infrastructure has gotten worse, according to company statistics. The PSC staff pointed to one of those numbers, which showed the company had 3,752 leaks or breaks in 2014, a 20 percent increase over the previous year.

Terry Eads, the PSC staff's utility division director, testified that the idea and basis behind the request for a surcharge now was partly the result of a recent law passed by the West Virginia Legislature.

In March, the legislature passed a bill that gave gas utilities in the state the ability to charge customers for pipeline replacements. …

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