Private Water

The Maryland Public Service Commission (PSC) regulates the prices and services of privately owned water companies in Maryland.

  • There are about 26 of these private companies. They serve people who live in the countryside (rural) and some areas outside of big cities (suburban).
  • The PSC does not regulate the prices for water systems run by local government. This includes big systems like the one in Baltimore City or the Washington Suburban Sanitary Commission (WSSC).
  • Most people who live in Maryland get their water from these government-run systems or the WSSC, not the private companies.
     

Private water companies must file applications with the MD PSC to increase rates for water service. The MD PSC typically will assign the application to a Hearing Examiner to conduct a rate case hearing. OPC reviews the applications to determine if there is an impact on residential customers, and frequently retains an expert to review the application and additional documentation and file testimony. OPC examines the proposals for basic rates, connection fees, surcharges, and any other fees. Basic rates require an examination of the expenses of the company, such as maintenance, salaries and infrastructure investment, which are analyzed and compared with other similar companies to see if the requested increase is reasonable. Surcharges may be for expenses that have not been recovered in base rate revenues from customers, but are regular and ordinary business expenses which are properly recoverable.

 

Water companies get the water they sell in different ways:

  • Some companies get and clean (treat) the water themselves.
  • Other companies buy clean water in large amounts (bulk rates) from another company. This can be cheaper for customers. When they do this, they just pass the buying cost straight to you without raising the rate of return.

If a company has a big, unexpected cost (like a major pipe breaking), they might:

  1. Ask the PSC to approve a new, higher water rate right away.
  2. Ask the PSC for a surcharge so they can spread the cost of that big expense over a short amount of time.

 

You can find a list of the companies the PSC regulates here: www.psc.state.md.us/water/home-page/regulated-water-systems-in-maryland/