Climate Variability

Why It Matters

103-1

Our ability to provide the safe and reliable delivery of water and wastewater services is inextricably linked to climate change. Over the past 20 years, the U.S. has seen significant increases in the intensity and frequency of extreme weather events including hurricanes and wildfires. In 2020 alone, a record number of hurricanes and the largest wildfires in recorded history produced $95 billion in damages. These events and other climate change impacts, such as sea level rise and saltwater intrusion, have direct and devastating impacts on the communities we serve and test the resilience of our infrastructure.

Infrastructure may be particularly vulnerable to the effects of climate variability if it is aging, in poor condition or designed based on historical environmental conditions. Vulnerable infrastructure can lead to contamination or service disruptions for our customers. To avoid these negative impacts, American Water must leverage effective risk management and strategic planning to increase the resilience of infrastructure. When we invest in the resiliency of our systems, we are also investing in the communities we serve, which is essential to meeting our customers’ needs and providing clean, safe and reliable water and wastewater services.

Our Approach

103-2

Our state utilities operate across different regions in the U.S., requiring us to account for variations in climate change impacts based on geography. For example, California American Water has undertaken significant risk mitigation and minimization approaches in response to increased wildfire intensity and frequency, whereas coastal communities are starting to feel the impacts of sea level rise. Other areas, like the Midwest, face risks of intense droughts that may affect water supply. When such issues arise, we implement our emergency management plans to effectively address climate-related issues, which often includes coordinating with local municipalities and emergency managers.

We integrate climate change into our Asset Investment Strategy to better prepare and protect our water and wastewater utility infrastructure for the future. We utilize historical data, available climate modeling tools and expert reports to predict and manage our expected climate change risks and impacts. We pay particular attention to groundwater supply depletion from climate-related impacts and work to identify any aquifer impacts as early as possible. Our groundwater models assist our monitoring efforts so that our withdrawals match aquifer recharge rates. We also focus on community resilience to extreme weather events while sharing our findings and best practices with the industry.

Adapting our systems to be more resilient in the face of increased climate volatility enables us to protect the viability, integrity and resiliency of water supplies and infrastructure around the country. As the risks associated with our changing climate increase, we continue to evolve our approach to identify solutions that improve our management of related risks for the communities we serve.

Our Performance

103-3, IF-WU-450a.1

We regularly assess climate variability impacts on our most critical assets as part of our long-term capital planning, including the risks of equipment damage because of flooding. Inflow and infiltration can have a significant impact on wastewater collection systems, leading to overflows and challenges at the treatment plant. We conduct flow monitoring, hydraulic modeling, closed circuit television inspection (CCTV) and other inspections to identify sources of inflow and infiltration within our biosolid collection systems. The results of these assessments help us make recommendations that reduce inflow and infiltration, strengthen the resilience of our systems and infrastructure and improve service delivery for our customers.

We respond to the CDP Climate Change questionnaire annually and disclose the material financial implications, risks and opportunities of climate change on our business. We also include this information in our Annual Report.