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About Rates

Water-service rates are based on the real costs of treating and delivering water to customers, and are regulated by state public utilities commissions (PUCs). 

To determine rates, American Water and state PUC staffs study costs of construction, maintenance, operation, administration and financing. Once the studies are complete, the company and PUC present any differing conclusions before an administrative law judge. Based on the judge’s opinion, the PUC sets the water rates. Learn more about how investor-owned utilities make a case for rate adjustments, surmount hurdles to obtain permission to change rates, and benefit customers by operating in a highly regulated environment by reading our white paper - Challenges In The Water Industry: The Rate Approval Process.

Rates and billing frequency vary based on geographic area. In many areas, customers are billed based on a regular meter reading, while in some areas there is flat-rate billing. 

American Water’s rates are based on the true cost of providing water service to our customers. 

Rates can vary based on the cost of providing service in each of the communities we serve. Before it reaches your home or business, water is treated through an intricate involved process. Water begins its journey from its source and travels through our highly sophisticated plants, into underground pipes, to its final destination, your tap. That source can be a river, aquifer, or an underground well. Along the way, our teams of professional scientists use the latest technology as they oversee and monitor the water’s passage. We test the water quality frequently, using leading methods we pioneered. We understand the value of clean, high-quality water on tap 24 hours a day, and are committed to delivering it reliably. Each year, we conduct more than one million tests and measurements using the most advanced technology and equipment available at our state-of-the-art, world-renowned research laboratory in Belleville, Illinois, and at our local utility labs.

Reliable high-quality water delivery improves our lives and communities by:

  • Protecting public health
  • Providing fire protection
  • Creating opportunities for economic growth.

Of all of your needs, water is the single most important. It is a life essential resource – you need it every day for almost everything you do. American Water takes that very seriously and constantly looks for ways to improve upon how to deliver reliable, high-quality water. At about a penny a gallon, and considering how often you use water every day – it’s easy to see the true value of your water service – what other item in your household budget is as affordable? Think about how often you use your service and you’ll see why American Water is truly an exceptional value.