REGULATE WATER RATES IN GEORGIA
MICHAEL HARTMAN 0

REGULATE WATER RATES IN GEORGIA

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Georgia is one of only 5 states that do not regulate the rates charged by private water companies.

As a result, the rates charged by these companies can lead to annual rates of return on capital of 100% or more annually!

Water is a basic necessity of life, as are electric and natural gas services. All three are also natural monopolies – it would make no sense to run two sets of electric lines nor two sets of water lines in each neighborhood. So there is no common sense way to have competition in the provision of these services. This dilemma is resolved by having a state regulation system that allows companies to recover reasonable costs and earn a fair return on invested capital. It makes no sense that the State of Georgia regulates electric and natural gas companies, but not private water companies.

Using Piedmont Water Co., which serves Reynolds Lake Oconee and surrounding areas, as an example, here are the results of the non-regulation experiment that has been underway for many years in Georgia:

  • Rates for 5000 gallons of water + sewer in PW area are 2 ½ times higher than the median price in the State (source: GA Water Dashboard)
  • Prices that have increased 127% since 2012 vs inflation of only 43%
  • Connect fees for new homes in the area of $20,000
  • Connect fees for businesses that have been over $100,000

Rates in other areas served by private water companies are excessive as well. For example, the rates in Big Canoe, served by Utilities Inc of Georgia rival those of Piedmont Water in Reynolds.

To remedy this situation, the signees of this petition are requesting the Georgia State Legislature to pass legislation that requires the existing Regulatory apparatus of the State government to regulate the rates and the allowable return on investment of private water companies, just as they regulate electric and gas company rates and return on investment.

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