California Water (CWT) Completes Water Main Replacement Project
California Water Service (CWT) finishes water main replacement project to ensure 24X7 supply of reliable water services to its Woodside customers.
California Water Service Group CWT concluded its large-scale water main replacement project in Woodside, which it started last October to ensure continuous supply of safe and reliable services for its customers. Work included installing 5,155 feet of new 6-inch and 8-inch PVC water pipes along with 44 fresh customer service connections and 11 hydrants.
California Water Service is efficiently managing the upgrade and maintenance work of its aging infrastructure and is making systematic investment to fortify its infrastructure. After investing $298.7 million in 2020, the utility spent $138.5 million in the first six months of 2021. The company reaffirmed its 2021 capex estimates within the $270-$300 million range.
In July, it retired its old elevated water tank worth 100,000 gallon capacity from service, replacing it with a more reliable and economical pressure system to increase the water level and regulate water pressure. In the same month, it initiated a water main replacement project in central Los Altos. Such strategic actions to enhance its infrastructure are likely to boost its customer base in the future by increasing the resilience and reliability of its operations. The company is not only bettering its services via organic activities but also resorting to inorganic prospects.
California Water Service filed an application in July with the CPUC, seeking an approval for the 2022-2024 infrastructure improvement program, which also contains new rate designs. Per this petition, the company aims to invest $1.02 billion in the aforesaid time period.
Investments in Water Space
A delay in revamping the pipelines could result in loss of water on a daily basis while pipeline breaks might increase the possibility of potable water contamination. Per the U.S. Environmental Protection Agency, an estimated investment worth $750 billion is necessary to meet demand over the next 20 years.
The aging U.S. water and wastewater infrastructure requires bulk expenditure to ensure 24x7 supply of drinkable water and continuous wastewater services. Hence, large water utilities are actively investing in enhancing their quality of services. American Water Works Company AWK has plans to invest $10.4 billion in the 2021-2025 time period and $22-$25 billion in the next decade.
Middlesex Water Company MSEX has plans to invest $314 million during the 2021-2023 time period to strengthen its water and wastewater infrastructure. Another water utility Essential Utilities WTRG aims to spend $3 billion through 2023 to fortify operations and efficiently serve its expanding customer base.
Shares of the utility have gained 14.9% in the past three months, outperforming the industry’s rise of 12.3%.
Three Months’ Price Performance
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The company has a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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American Water Works Company, Inc. (AWK): Free Stock Analysis Report
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