Pennsylvania Communities Are Beating Back a Wave of Water System Privatization

In January, the Pennsylvania Supreme Court blocked the corporate takeover of a public water system in Chester, Pennsylvania. After a nine-year battle, the court ruled that Chester, a town of 33,000 outside Philadelphia, does not have the jurisdiction to sell the local municipal water system to Aqua, a massive company that owns water and sewer systems throughout the state.

The ruling came in the wake of major public pushback, with hundreds of residents joining state legislators at public hearings to oppose the sale. Save Chester Water Authority, a grassroots campaign, warned: “In every acquisition it has made, [Aqua] hikes up water bills through rapid-fire rate increases and infrastructure surcharges.” The state supreme court ultimately ruled that the town of Chester could not sell the water system over the objections of Chester Water Authority, an independent governing agency that had rejected the sale and wanted to remain public.

It was a victory for public water advocates in the state, who have been locked into a bitter battle with private water companies for the past decade.

The water landscape has changed drastically in Pennsylvania since the 1990s, when private companies began aggressively purchasing and consolidating small water and sewer systems throughout the state. The two largest water companies in the state (American Water and Aqua, which is a subsidiary of Essential Utilities) spent nearly $6 million lobbying the state legislature from 2014 through mid-2024, securing pro-privatization legislation that made water takeovers more profitable.

As more and more towns opted to sell their water and sewer systems for a one-time cash windfall, residents — with no say in the matter — were left paying the price. In Pennsylvania, water bills from privately owned systems are 84 percent more expensive than publicly provided water, according to a 2024 report from the nonprofit think tank In The Public Interest.

But in recent years, Pennsylvanians have been fighting back. In David and Goliath battles, groups of neighbors have organized to pack public meetings, create petitions and ballot initiatives, elect their co-organizers to public office, and file lawsuits, under names like Neighbors Oppose Privatization Efforts (NOPE) and Keep Water Affordable (KWA). These advocates have helped change the narrative, turning public opinion against water privatization. In April, Gov. Josh Shapiro issued a letter warning private utility companies that his administration will be cracking down on unnecessary rate increases. And in March, for the first time, legislation made it out of a House committee that would repeal a 2016 law that made it easier for private water companies to institute skyrocketing water rates.

“I think, especially now that we’ve kind of gotten our own playbook, it’s been harder for the private for-profit utilities to get a foothold in some of these municipalities,” Kofi Osei, an organizer-turned-elected official who helped block the sale of Towamencin Township’s sewer system, told Truthout.

But the powerful water industry has not given up the fight. The two largest U.S.-based water corporations (American Water and Essential Utilities) are well on their way to a merger, further reducing any semblance of competition. Meanwhile, American Water is currently seeking to raise water and sewer rates for its consumers across Pennsylvania.

And even as the Chester Water Authority ultimately won its fight to block its sale in January, the Pennsylvania Supreme Court allowed another contested sale to go through in December 2025. In that case, the Pennsylvania Consumer Advocate had sued to block the sale of East Whiteland’s sewer system to Aqua, arguing that Aqua’s planned rate hikes meant the deal was not in the public interest. But ultimately, the Supreme Court reversed a lower court ruling, allowing the sale to move forward.

“A lot of the water industry was following [the East Whiteland case],” Mary Grant, Public Water For All director at Food & Water Watch, told Truthout, “because if [private companies] had to actually demonstrate that acquisitions were in the public interest … it would have really put a damper on a lot of privatization activity, and the most egregious and most costly acquisitions.”

Because it would be impractical and expensive to duplicate water infrastructure, it doesn’t make sense for two systems to operate in the same place, making water a so-called “natural monopoly.” To keep rates reasonable, states have governing bodies that oversee the private provision of essential goods and services. Pennsylvania’s Public Utility Commission (PUC), overseen by five governor-appointed commissioners, and with a staff of more than 500, must approve system sales, as well as requests from private utility providers to raise rates for their consumers.

There are generally two reasons private companies are allowed to raise rates in Pennsylvania: To recoup what they spent on the initial purchase of a water or sewer system, and to pay themselves back for capital investments they’ve made improving the system.

In recent decades, pro-privatization laws have made it easier for companies to maximize their profits in Pennsylvania. In particular, Act 12, passed in 2016, allows private companies to purchase water systems from municipalities at an artificially inflated rate, known as “fair market value.” The companies can then institute massive rate hikes to recoup the high cost of their investment.

“It is the most pro-utility, anti-customer provision ever added to Pennsylvania’s public utility laws,” wrote James H. Cawley, an attorney and former PUC commissioner, in written testimony submitted to the PUC in 2024. “Act 12 was misleadingly sold to the legislature as a necessary incentive for large water companies to acquire distressed and impoverished municipal water and sewer systems. As enacted, the … procedure has been used to acquire only healthy and well-managed municipal systems.”

“Because they can recover the full amount of the acquisition cost from households and earn a profit on it, [purchasing companies] are going to push for a higher and higher purchase price,” Grant told Truthout. And since the town also wants to make as much as it can on the deal, “you have both the buyer and the seller pushing for a higher purchase price, and at the end of the day, who’s paying? It’s households and local businesses, in hikes in their water and sewer bills.”

“What Big Water is doing here, is they’re coming to municipalities and saying, ‘Hey, I’ve got a big pile of free money for you.’ And waving money in front of politicians is like putting a big jar of M&Ms in front of a little kid,” Bill Ferguson, a cofounder of Keep Water Affordable, told Truthout. “The municipalities are not making decisions in the interest of the ratepayer; they’re looking to win the lottery.”

The PUC is supposed to determine whether an acquisition or rate hike is in the public interest. But it rarely rejects either. Between the passage of Act 12 and the end of 2025, 25 acquisitions were approved in the state. (According to Ferguson, there have now been 29 Act 12 acquisitions, as of May 2026.) A 2023 analysis found that once these systems went private, rates went up anywhere from 44 to 166 percent.

Unlike municipally-run water systems, private companies pay shareholder distributions and high executive salaries. In 2022, Aqua Pennsylvania paid its CEO $4.5 million in salary, stocks, and bonuses. That amounts to more than the combined salaries of the 52 employees of North Penn Water Authority, a municipally owned, non-profit water authority in eastern Pennsylvania.

“If you’re a municipality, you’re a nonprofit system, you don’t have to collect money to pay investors,” said Ferguson. “My Aqua bill for sewer, 40 cents of every dollar goes to their pre-tax profits.”

Ultimately, this means higher prices for local residences and businesses. In 2024 testimony, the Pennsylvania Municipal Authorities Association presented evidence that in 2022, a year of water for a family of four cost $2,042 from Aqua, and $1,782 from the Pennsylvania subsidiary of Essential Utilities. Meanwhile, the same amount of water cost $700 from two public water authorities in the state, and $516 from a third.

A 2022 research article in the journal Water Policy found that, among the 500 largest water systems in the U.S., private water ownership was the largest factor in higher water prices. The average annual water bill was $144 higher from privately owned water systems.

“People should see privatization for what it really is, a scam,” North Penn Water Authority Director Anthony Bellitto told the Penn Capital-Star in 2023. “It is a loan, disguised as a gift, wrapped up with empty promises that must be paid back with interest through exorbitant rate increases resulting in no better service to the customers.”

The first Pennsylvanian town to sell following the passage of Act 12 was New Garden, a small town on the Delaware border. After Aqua purchased New Garden’s sewer system, furious and frustrated residents saw their bills nearly double. At a 2022 Board of Supervisors meeting, residents grilled the board and read from their water bills for over an hour. One board member, who was not on the board when the sale went through, said: “It is sold, unfortunately. I can’t un-sell it, and if I could, I certainly would.”

Ferguson and other New Garden community members joined together in 2021, protesting the sale under the name Keep Water Affordable (KWA). Although KWA was unable to reverse its own town’s sale, the organization is “now dedicated to helping ratepayers in other municipalities avoid a similar fate … Our mission is to educate people about our story and the stories of ratepayers in other municipalities who have been victimized by Big Water.”

Margo Woodacre, a New Garden resident and KWA member, spoke out against the proposed sale of the water system in Chester. “Aqua’s takeover meant higher bills and no one local to turn to for help,” she told the Chester County Press in December 2025, referring to her own experience in New Garden. “I do not wish our fate on [the Chester water authority’s] ratepayers.”

Other Pennsylvania communities have successfully fought back against Aqua takeovers. In 2020, activists blocked the sale of the Norristown sewer system to Aqua, organizing around the name Norristown Opposed to Privatization Efforts (NOPE). In 2022, activists convinced the Bucks County Water and Sewer Authority to back out of selling to Aqua for $1.1 billion, which would have been the largest water and sewer privatization deal in U.S. history. And after significant public backlash, officials in Newberry and Willistown backed out of selling their sewer systems to Aqua in 2023.

In one particularly drawn out fight, community members in Towamencin, a small township outside Philadelphia, formed their own branch of NOPE (changing the N from “Norristown” to “Neighbors”) in 2022 to block the sale of its sewer system. ​​It was a multi-step process, which involved multiple ballot initiatives; rewriting the city charter; lawsuits; and getting three NOPE members elected to the board of supervisors, including Osei. The roadblocks were enough to get two successive companies to back out of acquisitions, the Florida-based NextEra and Aqua. Now, Towamencin’s town charter expressly bans privatization of the sewer system.

“Everyone who had a fight was very eager to spread information to the next fight,” said Osei, whose Towamencin NOPE chapter got advice from organizers in Norristown and Conshohocken. “I still get people who reach out to me about potential sales in their municipalities.” Ferguson said that a small group of public water advocates from around the state have a standing Zoom meeting every other week.

“Towamencin is a really great example of how local leaders in the community can take action and go up against these large companies,” said Grant.

Following in Towamencin’s footsteps, Pittsburgh prohibited the sale of its water and sewer system by ballot initiative in 2025, garnering an overwhelming 79 percent of the vote.

“Once a company has a stake in the game, it can be really hard to go up against those interests,” said Grant. “So, it’s really much better to have the protections in place first, before there’s someone who has a financial stake in the sale vote.”

But as communities increasingly distrust and fight privatization, water companies are doubling down. American Water and Essential Utilities plan to close their merger by early 2027. The merger requires the approval of the utility commissions in each state in which they operate; Ohio became the second to approve in May. And in December, American Water asked the PUC to approve a rate hike for all its water and sewer customers in Pennsylvania.

In an attempt to slow privatization and rate hikes, a piece of legislation that would repeal Act 12 has made it out of committee in the Pennsylvania House, but has not yet been brought before the full chamber. “For too long, the law has prioritized profit over people, leading to higher utility bills and major financial strain on ratepayers,” said Democratic Rep. Danilo Burgos, who sponsored the legislation, in a memo to fellow House reps. “Water is a basic human need NOT a profit stream. We have a duty to stand up for our constituents, not private corporations.”

It is an election year, which Osei hopes will put pressure on lawmakers to pass the legislation. He also noted that the Pennsylvania’s ongoing data center boom has focused public attention on utility costs. In a notable May decision, the PUC took steps to protect electric consumers, voting to require “large-load” electric customers to pay for necessary infrastructure upgrades in advance, instead of via universal electric rate hikes.

The fight against water privatization continues to resonate with Pennsylvanians across the state, spurring activism at the local and state level. “It directly affects the pocketbook,” said Osei. “Everyone has to pay the utility rates. I think that’s a big reason why the data center stuff is getting a lot of pushback too. It’s like: ‘Why should we be paying for corporate profits?’”