Mechanicsburg-based Pennsylvania American Water, a subsidiary of American Water, recently signed an agreement to purchase water system assets from East Dunkard Water Authority for $5 million.
The system serves approximately 1,600 customers in Greene County.
The purchase benefits both companies. It will allow Pennsylvania American Water to expand its presence to 38 counties, and it will allow East Dunkard Water Authority a solution to a Pennsylvania Department of Environmental Protection (DEP) consent order from 2020. Pennsylvania American Water plans to invest more than $17 million to modernize the system’s infrastructure.
“The sale of our water system to Pennsylvania American Water will unburden the authority of having to correct deficiencies in our system that we simply couldn’t afford,” Jerry Dorsey, East Dunkard Water Board chairman, said. “This transaction will allow Pennsylvania American Water to work with the DEP to efficiently address needed improvements and make significant capital investments in the system. Undoubtedly, these measures will ensure that our customers receive the high-quality product and service they rightfully deserve.”
The companies have been in discussion for nine months about a potential sale. The companies now need regulatory approval from DEP and the Pennsylvania Public Utility Commission. Once it is received, the transaction is expected to close next year.