How American Water Grows Earnings

AMERICAN WATER Energy Use • • . GHG emissions: Goal of reducing 40% by 2025 from 2007 baseline, after achieving 31% reduction through 2017 Design for efficiency: enhanced pump, lighting and process design standards Construct for efficiency: sustainable construction standards and methods Operate for efficiency: enhanced best operating practices, leak detection and repair procedures Maintain for efficiency: computerized maintenance management systems and preventive maintenance systems Environment • • • Water Use Water Policy Leadership San Clemente dam: Deconstruction to restore "run of river" Monterey Peninsula Water Supply Project: Recycling, reuse and desalination using marine life friendly slant wells Customer conservation: Proactive measures in 8 of our states Recycle and reuse: 3.5 billion gallons per year • Capital investment: Expect 5 year $8.0 billion to $8.6 billion total capital investment to address aging infrastructure, reduce/eliminate leaks, improve cyber/physical security, and increase resiliency of critical assets due to climate variability Research & Development: 15 scientists dedicated to research and partnering with water research foundations, on water quality and technology-water source monitoring • Collaboration: EPA, CDC, state DEPS and other agencies to support effective environmental, health and safety, and water quality standards and regulations 24

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