American Suburban Utilities would receive about half of its requested rate hike and plant expansion under a recommendation from the Indiana Office of Utility Consumer Counselor.
The privately-owned wastewater utility in September asked to increase its flat monthly residential rate from $47.50 a month to $93.36 a month by July 2018. The company later reduced the increase to $89.63.
ASU says it needs revenue to finance environmental upgrades and to expand capacity from 1.5 million gallons a day to more than 6 million gallons a day at its Carriage Estates sewer plant in West Lafayette.
The company's last rate increase took effect in 2006.
OUCC Spokesman Anthony Swinger says technical experts reviewed the request and believes ASU only needs to increase treatment capacity to 3.5 million gallons a day.
Also, the OUCC recommends the residential rate only increase to $55.22 a month.
“What we’re recommending is a lot more in line with what you would see with other utilities, versus the much higher amount the utility had asked for,” Swinger says.
He says the lower rate takes into account needed capacity, environmental compliance and a reasonable rate of return on investment.
“We believe with the rate amount that we are recommending, the utility will be able to provide safe service, reliable service and service that is compliant with environmental regulation,” he says.
Next month, representatives of ASU and the OUCC will make their cases to the IURC, which is in charge of setting utility rates in the state.