Customers across Illinois could be facing higher water and sewage bills as the state鈥檚 largest private water utilities seek rate increases and permission to merge.
Illinois American Water, the state鈥檚 largest private water utility, is seeking a $142 million rate increase, which would raise typical water costs for its 357,000 residential customers by around $14 per month. Typical wastewater customers would see an additional increase of around $28 per month.
Aqua Illinois, the second-largest private water utility serving over 90,000 customers in the state, has asked regulators to approve a $26.5 million rate increase, which would raise average combined water treatment and supply bills by about $23 per month.
But as the Illinois Commerce Commission weighs those rate cases, it is also evaluating a between the two water utilities鈥� parent companies. The Citizens Utility Board, a watchdog group, is calling on the ICC to reject the merger.
The consumer advocate group warns that approval of the merger between Illinois American鈥檚 parent company, American Water, and Aqua鈥檚 parent company, Essential Utilities, would allow unprecedented market consolidation.
鈥淚llinois American and Aqua have a long history of consumer complaints about escalating bills and poor service, and our expert testimony shows that there is no reason to believe that the merger will fix these problems,鈥� CUB Executive Director Sarah Moskowitz said in a statement. 鈥淭hat鈥檚 why we urge the ICC to reject this deal or set strong guardrails to hold these companies accountable to their long-suffering customers.鈥�
After Illinois American last month, which formerly provided water to customers in 15 counties in north and central Illinois, CUB estimates that approving the merger of Illinois American and Aqua Illinois鈥� parent companies would mean that over 99.99% of regulated water and wastewater utility customers in the state would be served by American Water and its affiliates.
鈥淭he fact that Illinois鈥� two biggest private water companies are seeking higher rates in 2026, as one parent company tries to purchase another, just proves CUB鈥檚 point that the companies are more interested in seeking higher profits than actually serving the public good,鈥� Moskowitz said.
If approved by regulators, the merger would be expected to close in the first quarter of 2027, according to a joint from the companies.
What customers can expect
Both water utilities say the rate increases are necessary to pay for critical infrastructure upgrades and upkeep of aging water pipelines, storage tanks and equipment.
If approved in full by the ICC, Aqua Illinois customers can expect to see a rate increase take effect in late April 2027. The increase would be roughly 15% for average residential customers who pay for wastewater collection and treatment in addition to their water bills, bringing monthly bills to around $178, and nearly 30% for residential customers who do not pay for wastewater treatment, bringing their bills to around $102 per month, according to the company鈥檚 .
The company said the request also reflects its need to replace lead service lines and defend against cyber security threats.
CUB objected to Aqua Illinois鈥� filing, saying it was driven more by shareholder interests and the company鈥檚 鈥渙utrageous鈥� request to increase its shareholder return on equity from 9.6% to 10.8%, which CUB said would make it the highest of the state鈥檚 major utilities.
Rebecca Losli, president of Illinois American, said the company鈥檚 $142 million request was driven by approximately $577 million needed to 鈥渕odernize and strengthen鈥� its water and wastewater systems in 2026 and 2027.
鈥淭hese investments directly benefit the communities we proudly serve and provide our customers with even more reliable service and improved water quality 鈥� from treatment to the tap,鈥� Losli said. 鈥淚t underscores our employees鈥� commitment to the health and safety of our customers and the communities we serve.鈥�
Like with Aqua Illinois, CUB called out Illinois American鈥檚 request to bump its shareholder return on equity from 9.84% to 10.75%.
The watchdog urged customers of Illinois American to attend or submit comments ahead of a in Bolingbrook on July 14. Customers can or by calling the ICC鈥檚 Consumer Services Division at 1-800-524-0795 on weekdays between 8:30 a.m. to 5 p.m.
A forum has not been publicly scheduled regarding the Aqua Illinois rate case as it is in an earlier stage, but impacted customers are still able to submit comments .
Gov. JB Pritzker that requires the ICC to offer public forums for customer feedback on future rate cases, although the bill does not take effect until Jan. 1.
The ICC is expected to rule on the proposed merger in November, on the Illinois American rate case in December and on the Aqua Illinois rate case in May 2027.
If approved, Illinois American鈥檚 rate increase would take effect in January 2027 and Aqua Illinois鈥� in late April 2027.
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