Aqua Texas Gets Grilled on Assets, Acquisitions, and Studies

In the latest development of the rate case involving Aqua Texas, Inc., the Office of Public Utility Counsel (OPUC) has issued its Fourth Request for Information (RFI), a formal demand for clarity and documentation. This effort scrutinizes Aqua Texas’s proposed rate changes and ensure that every dollar claimed is justified and transparent.

OPUC is asking the company to go beyond generalities and provide transaction-level data for each asset, everything from the asset’s name and location to its original cost, depreciation schedule, and how it was acquired. The goal is to understand not just what Aqua owns, but how those assets were valued and whether those valuations are fair to ratepayers.

The RFI also dives into Aqua’s system acquisitions since the last rate case. For each acquisition, OPUC wants to see the purchase agreements, a breakdown of the assets involved, and the valuation methods used. This includes a special focus on acquisitions like Texas American, where engineering and financial studies may have influenced asset pricing. Aqua is expected to submit those studies and explain the rationale behind the numbers.

Beyond asset details, the request demands a full accounting of costs. Aqua must disclose direct expenses, labor, overheads, and any financial charges incurred during construction—such as the Allowance for Funds Used During Construction (AFUDC). Each figure must be backed by documentation, and any new information that emerges before the hearing must be promptly shared.

Key Components

1. Detailed Asset Information Requested

OPUC requests a transaction-level breakdown for each asset Aqua seeks to include in the rate base, including:

• Asset name, description, location, installation date
• Depreciable life, original cost, depreciation details
• Supporting documentation and Bates numbers
• Allocation of overheads, labor, and other charges
• Classification of asset acquisition method (e.g., fair market valuation, installation)

2. System Acquisitions

For each system acquired since the last rate case:

• Provide purchase agreements
• Detail assets acquired, valuation method, and book values
• Clarify whether acquisition adjustments were requested

3. Engineering and Financial Studies

• Submit engineering studies used to determine asset values
• Explain valuation methods used in specific acquisitions (e.g., Texas American)

4. Cost Breakdown Requirements

For each asset, Aqua must disclose:

• Direct costs, labor, overheads
• Allowance for Funds Used During Construction (AFUDC)
• Calculations and documentation supporting each cost component

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Filing Details

• Filed Date: September 12, 2025
• Control Number: 58124
• Item Number: 3783
• Submitted by: Benjamin Barkley and team at OPUC