American States Water Company (NYSE: AWR) announced that the California Public Utilities Commission approved a request to defer the cost of capital application by another year for its subsidiary, Golden State Water Company.
The CPUC postponed the filing date for the cost of capital application by one year to May 1, 2027, with an effective date of January 1, 2028.
Golden State Water Company's current authorized rate of return on rate base is 7.93%, incorporating a return on equity of 10.06%, an embedded cost of debt of 5.1%, and a capital structure of 57% equity and 43% debt.
CPUC Approval
California Public Utilities Commission approved the deferral of Golden State Water Company's cost of capital application by one year.
Filing Date Extension
The filing date for the cost of capital application is postponed to May 1, 2027, with an effective date of January 1, 2028.
Rate of Return
Golden State Water Company's current authorized rate of return on rate base is 7.93%, including a return on equity of 10.06% and an embedded cost of debt of 5.1%.
- The approval allows Golden State Water Company to maintain its current cost of capital structure, ensuring stability in its financial returns through 2027.
- Postponing the cost of capital application filing date provides additional time for financial planning and assessment of market conditions for Golden State Water Company.
The approval of the cost of capital application deferral by the CPUC provides a strategic advantage to Golden State Water Company in managing its financial obligations and maximizing shareholder value in the coming years.