American Water (NYSE: AWK) unit seeks $134M Illinois rate hike

Rhea-AI Filing Summary

American Water Works Company, Inc. reported that its wholly owned subsidiary Illinois American Water has filed a request with the Illinois Commerce Commission to adjust its water and wastewater rates through a two-step increase in aggregate annualized incremental revenue. The request seeks approximately $119 million effective January 1, 2027, based on a proposed 10.75% return on equity and a capital structure with 52.42% equity and 47.58% debt, and an additional approximately $15 million effective January 1, 2028, with a capital structure of 52.74% equity and 47.26% debt, in each case excluding infrastructure surcharges. The filing is driven primarily by about $577 million of capital investments from January 2026 through December 2027 and must be approved by the Commission. The company highlights that outcomes will depend on regulatory decisions, potential settlements, timing of rate implementation and broader regulatory, economic and industry factors.

Insights

Regulated utilities analyst

Illinois rate case targets $134M in new revenue tied to $577M capex.

Illinois American Water, a subsidiary of American Water Works Company, is seeking a two-step rate increase that would add approximately $119 million of annualized incremental revenue starting January 1, 2027, plus about $15 million from January 1, 2028. The proposal is based on a 10.75% return on equity and capital structures with just over half equity and just under half debt.

The request is driven by roughly $577 million of capital investments planned or made between January 2026 and December 2027, reflecting ongoing infrastructure spending in Illinois. For regulated utilities, approval of such rate cases is the mechanism to recover invested capital and earn the allowed return, so regulatory outcomes directly influence earnings from that jurisdiction.

The impact will depend on the Illinois Commerce Commission’s final order, including any changes to the requested revenue, authorized return on equity, capital structure, and the timing of new rates. Subsequent ICC decisions or settlement terms, as well as future company filings following the test year through December 31, 2027, will clarify how much of the requested revenue is ultimately realized.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

Current Report

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 27, 2026

American Water Works Company, Inc.

(Exact name of registrant as specified in its charter)

Commission File Number: 001-34028

Delaware			51-0063696
(State or other jurisdiction of incorporation)			(IRS Employer Identification No.)

1 Water Street

Camden, NJ 08102-1658

(Address of principal executive offices, including zip code)

(856) 955-4001

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol

Name of Each Exchange on Which Registered

Common stock, par value $0.01 per share

AWK

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 8.01.    Other Events.

Filing of Rate Request with the Illinois Commerce Commission (the “ICC”) by Illinois-American Water Company (“Illinois American Water”)

On January 27, 2026, Illinois American Water, a wholly owned subsidiary of American Water Works Company, Inc. (the “Company”), announced that it filed a request with the ICC to adjust its water and wastewater rates. The filing seeks a two-step rate increase in aggregate annualized incremental revenue, based on a proposed return on equity of 10.75%, of (i) approximately $119 million effective January 1, 2027, based on a future test year through December 31, 2027 and a capital structure with an equity component of 52.42% and a debt component of 47.58%, and (ii) approximately $15 million effective January 1, 2028, based on a future test year to include end-of-period rate base and a capital structure with an equity component of 52.74% and a debt component of 47.26%, in each case, exclusive of infrastructure surcharges. The request is driven primarily by approximately $577 million in capital investments made and to be made by Illinois American Water from January 2026 through December 2027. The request must be approved by the ICC.

A copy of the press release issued by Illinois American Water on January 27, 2026 has been filed as Exhibit 99.1 hereto and is incorporated herein by reference. References and links to websites and other information contained in this press release are not provided as active hyperlinks, and the information contained in or accessed through these hyperlinks shall not be incorporated into, or form a part of, this Current Report on Form 8-K.

Cautionary Statement Concerning Forward-Looking Statements

Certain statements included in this Current Report on Form 8-K (or the exhibit thereto) are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995. In some cases, these forward-looking statements can be identified by words with prospective meanings such as “intend,” “plan,” “estimate,” “believe,” “anticipate,” “expect,” “predict,” “project,” “propose,” “assume,” “forecast,” “outlook,” “future,” “pending,” “goal,” “objective,” “potential,” “continue,” “seek to,” “may,” “can,” “will,” “should” and “could,” or the negative of such terms or other variations or similar expressions. These forward-looking statements are predictions based on the Company’s current expectations and assumptions regarding future events. They are not guarantees or assurances of any outcomes, performance or achievements, and readers are cautioned not to place undue reliance upon them. The forward-looking statements are subject to a number of estimates and assumptions, and known and unknown risks, uncertainties and other factors. Actual results may differ materially from those discussed in the forward-looking statements included in this Current Report on Form 8-K as a result of the factors discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the Securities and Exchange Commission (the “SEC”) on February 19, 2025, and other filings with the SEC, and additional risks and uncertainties, including with respect to (1) any approval by the ICC of Illinois American Water’s request for adjustments to its water and wastewater rates (including with respect to the reconciliation of end-of-period rate base following the conclusion of the future test year); (2) the terms of any settlement agreement or stipulation, and/or order of the ICC, related to this request; (3) the timing of any implementation of adjusted rates by Illinois American Water, if approved; (4) regulatory, legislative, local or municipal actions affecting the water and wastewater industries, which could adversely affect the Company or Illinois American Water; (5) the amount and timing of future proposed or anticipated capital expenditures and investments by Illinois American Water; and (6) other economic, financial, political, business and other factors that may impact or affect the water and wastewater industries generally or the Company or Illinois American Water specifically.

These forward-looking statements are qualified by, and should be read together with, the risks and uncertainties set forth above and the risk factors included in the Company’s annual and quarterly reports as filed with the SEC, and readers should refer to such risks, uncertainties and risk factors in evaluating such forward-looking statements. Any forward-looking statements speak only as of the date of this Current Report on Form 8-K. The Company does not have any obligation or intention to update or revise any forward-looking statement, whether as a result of new information, future events, changed circumstances or otherwise, except as otherwise required by the federal securities laws. New factors emerge from time to time, and it is not possible for the Company to predict all such factors. Furthermore, it may not be possible to assess the impact of any such factor on the Company’s or Illinois American Water’s business, either viewed independently or together, or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement.

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Item 9.01.    Financial Statements and Exhibits.

(d) Exhibits.

The following exhibits to this Current Report have been filed herewith (except as noted below):

Exhibit No.						Description
99.1*						Press Release, dated January 27, 2026, issued by Illinois American Water.
104						Cover Page Interactive Data File (the cover page XBRL tags are included and formatted as Inline XBRL).
*Filed herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

AMERICAN WATER WORKS COMPANY, INC.

Dated:

January 27, 2026

By:

/s/ DAVID M. BOWLER

David M. Bowler

Executive Vice President and Chief Financial Officer

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FAQ

What regulatory action did American Water Works (AWK) report for Illinois?

American Water Works reported that its subsidiary Illinois American Water filed a request with the Illinois Commerce Commission to adjust its water and wastewater rates through a two-step increase in aggregate annualized incremental revenue.

How much additional revenue is Illinois American Water seeking in its rate request?

The filing seeks aggregate annualized incremental revenue of approximately $119 million effective January 1, 2027 and about $15 million effective January 1, 2028, excluding infrastructure surcharges.

What return on equity and capital structure does Illinois American Water propose?

The request is based on a proposed 10.75% return on equity. For the first step, the capital structure assumes 52.42% equity and 47.58% debt; for the second step, it assumes 52.74% equity and 47.26% debt.

What investments are driving American Water Works’ Illinois rate request?

The request is driven primarily by approximately $577 million in capital investments made and to be made by Illinois American Water from January 2026 through December 2027.

Is the Illinois American Water rate increase request already approved?

No. The filing states that the request must be approved by the Illinois Commerce Commission, and outcomes will depend on the Commission’s order or any settlement and on the timing of implementing adjusted rates.

What risks and uncertainties does American Water Works highlight around this rate case?

The company notes uncertainties related to any ICC approval or reconciliation of end-of-period rate base, the terms of any settlement or order, timing of rate implementation, future capital expenditures, and broader regulatory, economic, political, and industry factors.