Hawaii Water Service Proposes First Rate Adjustment for Kapalua since 2021; Reflects Investments Made to Help Improve Reliability and Maintain Safe Utility Service

Rhea-AI Summary

California Water Service Group (NYSE: CWT) subsidiary Hawaii Water Service filed with the Hawaii Public Utilities Commission on Nov 20, 2025 to raise rates for its Kapalua water and wastewater systems for the first time since 2021. The filing seeks a $2.2 million revenue increase to recover higher purchased water costs, rising operating expenses, and completed capital investments.

Hawaii Water reported $3.4 million of infrastructure investments including storage rehabilitation, valve replacements, new backup generators, sewer pump station upgrades, and lift/sump pump replacements. The company cites about $1.7 million annually in purchased-potable and non-potable water costs. If approved as filed, new rates could take effect in the second half of 2026.

Positive

• $3.4M invested in Kapalua water and wastewater infrastructure
• Upgrades target storage, valves, generators, and pump stations
• Purchased-water costs proposed passed through on a $-for-$ basis

Negative

• Request seeks a $2.2M revenue increase affecting customers
• Purchased water costs add about $1.7M in annual expense
• New rates could take effect in H2 2026, increasing bills

Insights

Utility regulation analyst

Rate increase request seeks $2.2 million to cover purchased water costs and recover $3.4 million of infrastructure spending; decision could take until the second half of 2026.

The filing asks the Hawaii Public Utilities Commission to raise water and sewer revenues by $2.2 million, citing higher purchased water costs, labor and inflation, and to recover $3.4 million of capital investments made since the 2021 acquisition. Passing purchased water costs on a dollar‑for‑dollar basis limits margin exposure for the utility while directly linking customer bills to that input cost. Recent capital work includes reservoir rehabilitation, valve and generator replacements, pump station upgrades, and wastewater lift‑station work aimed at improving reliability and reducing leak risk.

Regulatory approval is the main dependency; outcomes often hinge on reasonableness of cost recovery and demonstrated service benefits. The proposal documents specific projects and quantifies requested revenue ($2.2 million) and annual purchased water costs (~$1.7 million), which supports the filing but does not guarantee approval. Watch the PUC review timeline and any intervenor challenges; if approved as filed, new rates could take effect in the second half of 2026.

WAIKOLOA, Hawaii, Nov. 20, 2025 (GLOBE NEWSWIRE) -- California Water Service Group (NYSE: CWT) subsidiary Hawaii Water Service (Hawaii Water) has filed a request with the Hawaii Public Utilities Commission (PUC) to increase water and sewer rates in its Kapalua water and wastewater systems for the first time since acquiring the systems in 2021. The request seeks to increase revenues by $2.2 million to recover increases in purchased water costs, higher operating expenses, and the cost of completed capital investments.

Hawaii Water’s $3.4 million in infrastructure investments have funded upgrades and maintenance of the local water and wastewater systems, which are designed to enhance quality, reliability, and sustainability. Some of the major capital improvements made in Hawaii Water’s Kapalua service area include:

• Rehabilitation and upgrade of critical potable water storage facilities to expand water supply reliability.
• Replacement of aging valves to improve water system reliability and control.
• Replacement of emergency backup power generators to help maintain water pressure during power interruptions and improve fire protection.
• Significant improvements in a sewer pump station serving D.L. Fleming State Beach Park by replacing existing, aging pumps with new, surface-serviceable pumps and relocating controls above ground to improve response time, access, reliability, and efficiency.
• Replacement of lift station and sump pumps used in the wastewater treatment process to reduce the risk of future system leaks.
  
  

Additionally, the proposed increase covers additional operating expenses, such as about $1.7 million annually to purchase potable and non-potable water; labor costs; and inflation. The utility proposes to pass purchased water costs directly to customers on a dollar-for-dollar basis.

“Since we acquired the Kapalua systems, we have been committed to providing our Kapalua customers safe, clean, reliable water and wastewater services at affordable rates, and the important, strategic upgrades we have made in the last four years are critical to fulfilling this commitment,” said Marty Kropelnicki, Chairman and CEO. “We have simultaneously worked to control expenses to help keep service affordable, and be a responsible steward of the environment, which is even more vital in the face of Maui’s worsening drought.”

If approved as filed, new rates could become effective in the second half of 2026.

About California Water Service Group

California Water Service Group (NYSE: CWT) is the largest regulated water utility operating exclusively in the western United States. It provides high-quality, reliable water and/or wastewater services to more than 2.1 million people in California, Hawaii, New Mexico, Washington, and Texas through its regulated subsidiaries, California Water Service, Hawaii Water Service, New Mexico Water Service, and Washington Water Service, and its utility holding company, Texas Water Service. 

Group’s purpose is to enhance the quality of life for customers, communities, employees, and stockholders. To do so, it invests responsibly in water and wastewater infrastructure, sustainability initiatives, and community well-being. The company’s nearly 1,300 employees live by a set of strong core values and share a commitment to protecting the planet, caring for people, and operating with the utmost integrity. The company has been named one of “America’s Most Responsible Companies” and one of the “World’s Most Trustworthy Companies” by Newsweek, a USA Top Workplace, and a Great Place to Work^®.  More information is available at www.calwatergroup.com.

This news release contains forward-looking statements within the meaning established by the Private Securities Litigation Reform Act of 1995 ("PSLRA"). The forward-looking statements are intended to qualify under provisions of the federal securities laws for "safe harbor" treatment established by the PSLRA. Forward-looking statements in this news release are based on currently available information, expectations, estimates, assumptions and projections, and our management's beliefs, assumptions, judgments and expectations about us, the water utility industry and general economic conditions. These statements are not statements of historical fact. When used in our documents, statements that are not historical in nature, including words like will, would, expects, intends, plans, believes, may, could, estimates, assumes, anticipates, projects, progress, predicts, hopes, targets, forecasts, should, seeks or variations of these words or similar expressions are intended to identify forward-looking statements. Examples of forward-looking statements in this news release include, but are not limited to, statements describing Hawaii Water's request to increase water and sewer rates and, if approved, the potential timing for such rates to become effective. Forward-looking statements are not guarantees of future performance. They are based on numerous assumptions that we believe are reasonable, but they are open to a wide range of uncertainties and business risks. Consequently, actual results or outcomes may vary materially from what is contained in a forward-looking statement. Factors that may cause actual results or outcomes to be different than those expected or anticipated include, but are not limited to those described under the section entitled "Risk Factors" and elsewhere in our most recent Annual Report on Form 10-K, our subsequent Quarterly Reports on Form 10-Q and our other Securities and Exchange Commission filings. In light of these risks, uncertainties and assumptions, investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. We are not under any obligation, and we expressly disclaim any obligation to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise.

Media Contact
Yvonne Kingman
ykingman@calwater.com
310-257-1434

FAQ

What rate change did California Water Service (CWT) propose for Kapalua on Nov 20, 2025?

The company requested a $2.2 million revenue increase to recover costs.

How much has Hawaii Water invested in Kapalua infrastructure since 2021 (CWT)?

Hawaii Water reported $3.4 million in completed infrastructure investments.

What operating costs are driving the CWT Kapalua rate request?

The filing cites higher purchased water costs, labor, inflation, and other operating expenses.

How much of the Kapalua cost is from purchased water in the CWT filing?

About $1.7 million annually is attributed to purchased potable and non-potable water.

Will purchased water charges be passed to customers for CWT Kapalua service?

The utility proposes to pass purchased water costs directly to customers on a dollar-for-dollar basis.

When would new Kapalua rates for CWT take effect if approved?

If approved as filed, new rates could become effective in the second half of 2026.