8-KOther EventsExhibits & Filings

American Water Works Company, Inc. 8-K Report, Corporate Update (Nov 18, 2022)

Filed November 18, 2022For Securities:AWK

Summary

American Water Works Company, Inc. (AWK) announced a significant development for its subsidiary, California-American Water Company (Cal Am), on November 18, 2022. The California Coastal Commission has approved Cal Am's coastal development permit application for intake slant wells, a crucial step for the Monterey Peninsula Water Supply Project. This project includes a desalination plant intended to address unauthorized diversions from the Carmel River, as mandated by the State Water Resources Control Board. The approval is a positive step towards resolving California's water supply challenges in the region and fulfilling regulatory obligations. While this approval is a key milestone, investors should note that Cal Am still needs to secure remaining permits to commence construction of the desalination plant. Construction is anticipated to start in 2024, with the plant expected to be operational by the end of 2027. The company has included a cautionary statement regarding forward-looking information, highlighting potential risks such as obtaining further approvals, unexpected costs, and regulatory challenges that could impact the project's timeline and execution.

Key Highlights

  • 1California Coastal Commission approved Cal Am's coastal development permit for intake slant wells.
  • 2This approval is a critical component of the Monterey Peninsula Water Supply Project.
  • 3The project aims to supply water to a desalination plant and fulfill obligations to cease unauthorized Carmel River diversions.
  • 4Construction of the desalination plant is planned to begin in 2024.
  • 5The desalination plant is estimated to be in-service by the end of 2027.
  • 6Cal Am is still seeking other necessary permits for the project.
  • 7The company acknowledges forward-looking statements and associated risks, including regulatory hurdles and potential cost overruns.

Frequently Asked Questions

The approval is a major step forward for California-American Water's (Cal Am) Monterey Peninsula Water Supply Project. It grants permission for the intake slant wells, which are essential for supplying water to the planned desalination plant. This project is critical for Cal Am to meet regulatory requirements regarding water diversions from the Carmel River.

Construction of the desalination plant is expected to begin in 2024, with an estimated in-service date by the end of 2027.

Yes, Cal Am still needs to obtain other necessary permits to construct the desalination plant and complete the overall Water Supply Project. The company's filing also includes a cautionary statement highlighting potential risks, such as securing remaining approvals, unexpected costs, and regulatory challenges.

The Monterey Peninsula Water Supply Project, including the desalination plant, is designed to provide a new, reliable water source for the Monterey Peninsula. It will help Cal Am comply with orders to eliminate unauthorized diversions from the Carmel River, thereby contributing to more sustainable water management in the region.