Water Use & Efficiency Strategic Goals

Managing Customer Bill Impact with a Disciplined Focus on Operating Costs Regulated O&M Efficiency Ratio* AMERICAN WATER 46.1% 41.0% 39.1% 36.6% 35.6% 34.5% 34.1% 30.4% ** 2010 2012 2014 2016 2018 LTM 3/31/2020 LTM 3/31/2021 2025 Target Added 327,000** customer connections since 2010 Adjusted O&M Expenses from 2010 to LTM 2021 increased only 1.1% CAGR* * Non-GAAP Measure - See appendix for reconciliation. O&M Efficiency Ratio = Adjusted Regulated O&M Expenses (O&M Expenses is most comparable GAAP measure)/Adjusted Regulated Operating Revenues (Operating Revenues is most comparable GAAP measure). This calculation assumes purchased water revenues approximate purchased water expenses ** A reconciliation to a most comparable forward-looking GAAP measure is not available without unreasonable effort *** Includes organic customer connections, acquisitions and closed dispositions 7

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