American Water invests $3.2 billion in infrastructure as earnings rise, merger plans advance
American Water reported strong 2025 financial results while continuing to ramp up investment in water and wastewater infrastructure across its regulated service areas, the company announced.
The utility invested approximately $3.2 billion in capital projects during 2025, largely focused on system upgrades to improve water quality, reliability and long-term resilience. Spending also supported regulated acquisitions and ongoing replacement and rehabilitation of aging water and wastewater networks across multiple states.
Company officials said infrastructure investment remains a key driver of earnings growth and regulatory filings, with additional rate cases and infrastructure surcharge requests underway to support continued capital spending. Since the start of 2025, American Water has secured authorization for roughly $264 million in additional annualized revenue tied to rate cases and about $85 million in infrastructure surcharges linked to system improvements and acquisitions.
Looking ahead, the utility affirmed its long-term earnings and dividend growth targets of 7% to 9% and maintained 2026 earnings guidance as it continues investing in regulated water infrastructure. Shareholders also recently approved a pending merger with Essential Utilities, a move the company said will expand scale and support future investment in water and wastewater system modernization.
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