Illinois water, sewer bills could climb as top private utilities seek rate hikes and merger

Illinois residents could soon face higher water and sewer bills if regulators approve major rate hikes sought by the state's two largest private water utilities, even as the companies' parent corporations pursue a merger that consumer advocates warn could leave customers with fewer protections.

For households already dealing with rising housing and utility costs, the proposed increases could make a basic necessity even harder to afford.

What's happening?

The state's two largest private water utilities are asking for higher rates. Illinois American Water has requested a $142 million increase, and Aqua Illinois is seeking $26.5 million, according to Capitol News Illinois. If the Illinois Commerce Commission approves those requests, many customers could see higher monthly bills starting in 2027.

Illinois American said a typical residential water customer would pay about $14 more per month, and a typical wastewater customer's bill would jump by roughly another $28. Aqua Illinois said average combined water bills could rise by roughly $23 per month, with some customers facing monthly totals around $178, depending on their service.

Regulators are also reviewing a separate proposal for American Water, the parent company of Illinois American, to merge with Essential Utilities, which owns Aqua Illinois. Consumer watchdog Citizens Utility Board has urged the ICC to block the deal, warning that bigger bills alongside industry consolidation would hurt customers.

CUB Executive Director Sarah Moskowitz said, "Illinois 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."

Why does it matter?

Water and wastewater service aren't optional, which means customers can't cut back the way they might with other rising expenses. When rates go up, families absorb the added cost, even if service quality doesn't keep pace.

Last month, Illinois American bought Prairie Path Water Company, which previously served customers in 15 counties across northern and central Illinois. If regulators approve the larger merger, CUB estimates American Water and its affiliates would control over 99.99% of the state's regulated water and wastewater utility market.

Consumer advocates warn that near-total market control could weaken competition and accountability for ratepayers. CUB also objected to both companies' requests to increase shareholder return on equity.

The companies, however, say they need to increase rates to cover the costs of aging pipes, storage tanks, and treatment equipment. Aqua Illinois also said the request will fund lead service line replacement and cybersecurity defenses. Illinois American president Rebecca Losli said the company's investments will "modernize and strengthen" its systems and provide "more reliable service and improved water quality — from treatment to the tap."

What's being done?

The Illinois Commerce Commission will make the final call. Capitol News Illinois reported regulators plan to rule on the merger in November and on Illinois American's rate request in December, with Aqua Illinois's case expected by May 2027. Illinois American's proposed rates would start in January 2027 if approved, and Aqua's would likely begin in late April 2027.

CUB urged Illinois American customers to share feedback at the ICC's July 14 public forum in Bolingbrook. Customers can also submit comments online or call the ICC at 1-800-524-0795 (weekdays, 8:30 a.m. to 5 p.m.).

Aqua Illinois customers can also comment through the ICC website, though a public forum for that case hasn't been scheduled yet. A recently signed law from Gov. JB Pritzker will require the ICC to hold public forums on future rate cases beginning Jan. 1.

As Moskowitz put it, "The fact that Illinois' two biggest private water companies are seeking higher rates in 2026, as one parent company tries to purchase another, just proves CUB's point that the companies are more interested in seeking higher profits than actually serving the public good."

Get TCD's free newsletters for easy tips, smart advice, and a chance to earn $5,000 toward home upgrades. To see more stories like this one, change your Google preferences here.