Tennessee American Water will seek to hit the brakes on rising regulatory and litigation costs arising from water rate increases through a more streamlined system of surcharges.
The new rate system, similar to that used by TVA to pass on its fuel costs, would reduce the frequency and expense of pitched courtroom battles, and instead make surcharges contingent on a number of factors, such as the cost of power.
But such a change still must be approved by state lawmakers or regulators who may be reluctant to give the utility such rate flexibility.
State Rep. Richard Floyd, who proposed legislation last session to limit the utilty’s frequency of rate increases, said Thursday he would have to study Tennessee-American’s proposal.
“Right now, Tennessee American Water is a rate making company that happens to own a water company, and I totally disagree with the TRA allowing them to get by with the outrageous increases and the courts allowing them to pass their legal expenses to the consumer,” he said.