Tennessee American Water Co.'s new $14.2 million mechanism will separates solids, such as zinc, from river water sucked into the plant.Tennessee American Water is set to increase water rates by 5.61 percent, or an average increase of $1.21 per month, according to a news release.
The increase comes on the heels of large hikes over the past few years, in which the company aggressively sought double-digit rate increases, and was strongly opposed by the Tennessee Consumer Advocate as well as Chattanooga's city attorney.
The planned increase is subject to the Tennessee Regulatory Authority, under the new alternative rate mechanism process that allows the company to pass through certain costs directly to consumers without going through a rigorous regulatory hearing. The streamlined approach to rate increases was sought by the company after Tennessee Gov. Bill Haslam's administration reduced the size and power of the TRA.
The proposed increase will help pay for capital projects in 2015 slated to cost $17.5 million, the company said, including a $14.2 million residuals centrifuge facility at Tennessee American's water plant, as required by the EPA under the Clean Water Act.
"Our customers also play an important role because each time they make a water payment, they help to make critical improvements to our water system," said Deron Allen, president of Tennessee American Water. "We plan these projects based on greatest need, balanced by the price our customers pay. We are also very careful to manage our costs by operating as efficiently as possible."
If approved, the higher rate would be effective on January 1, 2015.
Read more in tomorrow's Times Free Press.