Illinois’ biggest private water players want to tie the knot, and the state’s top utility watchdog is telling regulators to call off the wedding.
The Citizens Utility Board is urging the Illinois Commerce Commission to reject a proposed merger of the parent companies of Illinois American Water and Aqua Illinois, arguing the deal would not serve consumers’ interests. CUB, which filed expert testimony this month, says the consolidation would not fix long‑running service problems and could pile onto already escalating bills. Company officials counter that combining forces would boost scale and investment capacity, and they say they hope to complete the transaction in the first quarter of 2027 if regulators sign off.
Watchdog’s Case: Rising Bills, Aggressive Buys, and a Time Out
In testimony submitted earlier this month, CUB lays out research and expert analysis that ties repeated acquisitions by private water companies to higher Illinois rates. The filing argues that those acquisitions have inflated Illinois water bills by more than $411 million since 2013 and says the applicants have not shown that the merger would translate into better service.
CUB is asking the ICC to reject the transaction outright or, if commissioners approve it, to attach a five-year moratorium on further acquisitions as a condition of approval, according to Citizens Utility Board.
What the Companies Say
American Water and Essential Utilities describe the proposed deal as an all-stock, tax-free combination that would create a larger regulated water and wastewater company serving roughly 4.7 million connections across 17 states. They have argued in filings and public statements that the merger would not directly raise customer rates.
The companies laid out that case in regulatory submissions and a joint announcement last October, telling investors they expect to close the transaction in the first quarter of 2027 if it clears state and federal reviews. Their claims and supporting exhibits are detailed by American Water.
How Regulators Will Decide
The merger is under review in the Illinois Commerce Commission docket P2025‑1057. The commission’s case page lists the application as a reorganization under Sections 7‑204 and 7‑204A of the Public Utilities Act.
CUB’s testimony and other intervenor filings sit alongside the applicants’ exhibits in the administrative record that regulators will weigh before issuing an order. The commission is expected to rule by Nov. 5, 2026, as reported by Shaw Local, and the case is docketed at the Illinois Commerce Commission docket.
Local Stakes and Recent History
Advocates point to recent rate increases and service problems as reasons for regulators to be skeptical of more consolidation. CUB notes that Illinois American has won roughly $230 million in rate hikes over the last decade and is now pressing for about $134 million more, while Aqua secured an $11.6 million increase in 2024. The testimony also highlights a 2023 outage in Lake County and elevated lead levels detected in University Park in 2019.
Those examples, CUB argues, undercut corporate assurances that a larger footprint will automatically deliver better reliability and affordability for customers, according to Citizens Utility Board.
What to Watch Next
Next up are additional filings from intervenors, any hearings the ICC chooses to schedule, and a key question for regulators: whether to attach strict performance conditions or limits on future acquisitions if the merger goes through.
Residents and local officials can track filings and hearing schedules on the ICC docket. The companies still need approvals in other states before the deal can close in early 2027. Advocates warn that, without enforceable guardrails, consolidation could leave Illinois customers with fewer choices and higher bills.
