SJW Group (NYSE:SJW) Q3 2023 Earnings Call Transcript

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Andrew Walters: So for us, I think, the key is, we don’t anticipate a significant cost offset due to the settlement. There will be some, right? But that is to be determined. There’s a lot of people that are participating. You have got to put the claims in and that process is going to take a significant period of time, which we don’t have time for. Whenever there is something like this for us to address on behalf of our customers, we are going to be very aggressive at working towards addressing the issues. And so given that, we will use and focus on the traditional recovery mechanisms that are at our disposal, which our various regulatory agencies have been very supportive of trying to take care of the health and safety of our customers.

Angie Storozynski: Okay. Okay. Understand. Thank you.

Andrew Walters: Thank you.

Operator: Please stand by for our next question. The next question comes from Jonathan Reeder with Wells Fargo Securities. Your line is open.

Jonathan Reeder: Hey. Sorry. Just had a one follow-up, if you don’t mind. So I know previously you stated that you weren’t optimistic that the CPUC or at least the staff, would be supportive of bringing back decoupling in California. Does the approval of the WCMA, does that change that perspective at all, that they are taking kind of a bigger picture, longer term kind of conservation effort and putting kind of those kind of tools in place, including potentially decoupling, would be beneficial?

Andrew Walters: No. I think what they are highlighting is they are focused on the specific issues that we are dealing with in our service area of having a voluntary drought declaration and they recognize that it sends mixed messages to your customers and that it creates undue stress on a company like us to try to recover when you have got the major wholesaler promoting conservation and trying to get people to use less water. So given that, I think, they have highlighted the need to make sure that everybody is driven towards the same results and that would be my view. I don’t want to…

Eric Thornburg: Yeah. I’d just add, Jonathan, that Valley Water has Anderson Reservoir undergoing a seismic refit and because of the lower pool that has to be maintained during that construction period, that’s a bit of a unique circumstance, but it’s expected to be out of service or reduced service for nearly a decade while that work is undergone. So I think for the foreseeable future, SJWC will benefit from this based upon those circumstances.

Jonathan Reeder: Okay. And you said that’s supposed to be a 10-year kind of project, so?

Eric Thornburg: That’s correct. Yeah. Anderson Reservoir.

Jonathan Reeder: Okay. Awesome. Thanks for the additional comments. Appreciate it.

Eric Thornburg: Absolutely. Thank you, Jonathan, for the clarifying question.

Operator: I show no further questions at this time. I would now like to turn the call back to Eric Thornburg for closing remarks.

Eric Thornburg: Thank you, Operator. On behalf of all my colleagues on the Board, we thank investors for their continuing support of and interest in SJW Group, an organization with over a century and a half of service to communities across the U.S. and we are just getting started. Thank you very much.

Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.

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