The California Public Utilities Commission (CPUC) recently decided to defer the 2024 cost of capital proceedings for the water utilities it regulates, including San Jose Water Co. (SJWC), California Water Service Co. (CWS), Golden State Water Co. (GSW), and California-American Water Co. (CAW), by one year to May 1, 2025. As such, we expect these water utilities will maintain their current authorized return on equity (ROE). We view this decision as generally supportive of the water utilities? credit quality. In November 2023, the CPUC authorized a 70 basis point increase in the ROE for the four California water utilities, which became effective on Jan. 1, 2024. Accordingly, SJWC?s authorized ROE increased to 10.01% from 9.31%, CWS' ROE increased to 10.27%
