Tennessee American Water rates could rise 5.6 percent in 2015

photo The Tennessee American Water's Citico treatment plant is located next to the Tennessee River in downtown Chattanooga.

Water bills throughout the Chattanooga area will likely rise close to 6 percent on Jan. 1, adding $1.21 for the average monthly Chattanooga residential bill.

The proposed rate hike is expected to fund infrastructure projects that Tennessee American Water plans next year, in conjunction with a new alternative rate mechanism the company is using.

The new method makes rate increases "more incremental" and allows the company to replace aging water infrastructure more rapidly, said Daphne Kirksey, a Tennessee American spokeswoman.

That method, which went into effect April 15, actually gave residential customers slight savings this past spring: a 2 cent decrease on average bills. But at that time, the company hinted that the lower rates might not last. The company estimates the average residential monthly bill to be $21.50.

Tennessee American's last rate increase was in 2012, before the new method had been adopted, when rates were increased by more than 12 percent. In comparison, the current proposed increase is 5.61 percent.

Tennessee American has about 81,000 connections, which serve 370,000 people, in Chattanooga, Lookout Mountain, Red Bank, East Ridge and parts of Northwest Georgia, including Rossville and Lookout Mountain.

The 2015 infrastructure capital projects total more than $17.5 million, according to the company. The main project costs about $14.2 million and includes a centrifuge that will remove zinc, which naturally occurs in the Tennessee River.

Tennessee American Water is a subsidiary of American Water, which is publicly owned and headquartered in Voorhees, N.J.

Contact staff writer Mitra Malek at mmalek@timesfreepress.com or 423-757-6406.

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