In November we reported on the investment proposal submitted by BWS to the Public Utilities Commission. The proposal outlines a $108.6 million dollar program of investment that BWS wants to make in water services and projects as well as the operational expenses that amount to $151.3 million dollars.
Well the PUC held a press conference today at the Radisson to deliver their response. Now, BWS did not receive the amount they proposed - the PUC approved $60.4 million in investment and $129.8 million in expenditure. While it might seem like a loss for BWS, Chairman of the PUC John Avery says that it is not calculated in loss and profit terms but really it is based on the feasibility of the projects. He gave us his view on those proposed projects.
John Avery, Chairman, Public Utilities Commission
"As is it we have some concerns about the feasibility of these projects whether or not they would get off the ground. And since the rate setting methodology wouldn't include such in the regulated asset value and they wouldn't have any impact on the rates, then we decided not to really consider them during this current rate review. The message the commission is sending is that we fully expect BWS to become more efficient, to retain enough earnings and to procure enough loans over the 5 year period in order to make the approximate 50 million dollars in investments that the commission has approved. These rates that we have approved are based on BWS operating in that manner. If in fact BWS does not perform with respect to the approved investments, then in subsequent rate reviews, not having complete those investments will force the commission to in fact review the rates and perhaps reduce them."
And what does this approval mean for consumers? Well you are expected to see a 2% increase in your water bill effective April 1st 2015.
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