New Jersey American Water, a subsidiary of American Water Works Company, Inc., disclosed that it will spend $781 million on water and wastewater system upgrades in 2025. The investment will upgrade treatment plants, tanks, pump stations, pipelines and metering equipment for more than 190 communities and is expected to create 12,490 jobs across the state.
The $781 million represents a 50 percent jump from the $520 million spent in 2024 and accounts for roughly a quarter of American Water’s total capital‑expenditure plan of $3.2 billion for 2025. The investment is part of the parent company’s long‑term strategy to invest $40‑$42 billion over the next decade to modernize aging infrastructure and meet regulatory demands.
Regulatory drivers for the upgrade include New Jersey’s lead‑service‑line replacement mandate and the state’s growing need to address PFAS contamination. The American Society of Civil Engineers’ 2025 Report Card estimates that New Jersey will need $12.3 billion for drinking‑water and $11.7 billion for wastewater infrastructure, underscoring the scale of the state’s needs and the importance of the announced spend.
Mark McDonough, president of New Jersey American Water, said, “Our $781 million investment isn’t just a number, it’s about staying ahead of aging infrastructure, so our customers don’t have to think twice about the water coming from their tap.” He added, “Even as we modernize and expand our footprint, we continue to upgrade pipes, treatment technology and service lines all while keeping water about a penny per gallon and bills well under one percent of median household income.” McDonough also noted, “Keeping our water infrastructure strong and reliable isn’t a one‑time job— it’s a proactive effort we focus on year after year. The capital investments we make across our systems provide more robust, efficient, and resilient infrastructure, which helps us continue to meet or surpass water quality standards and deliver better service for our customers.”
The investment is supported by a rate‑increase filing with the New Jersey Board of Public Utilities that could raise residential water bills by an average of $10 per month. The announcement comes shortly after American Water’s shareholders approved a merger with Essential Utilities, a deal expected to close by the end of Q1 2027, which will expand the company’s footprint and capital‑expenditure capacity.
The $781 million spend signals New Jersey American Water’s commitment to maintaining service reliability, protecting water quality and keeping rates affordable while meeting stringent regulatory requirements. The investment also positions the company to capitalize on emerging opportunities in PFAS treatment and lead‑service‑line replacement, reinforcing its long‑term growth strategy and strengthening its competitive position in the regional water utility market.
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