Customers of the Kent County Water Authority, which includes about 4,000 homeowners and businesses in the Apponaug, Cowesett and East Natick sections of the city, can expect their rates to increase more than 14 percent as of the first of the new year. A second increase of 4.77 percent would take affect under provisions of the settlement agreement approved Tuesday morning by the Public Utilities Commission (PUC).

The Warwick Water Division that purchases water from the Providence Water Supply Board serves most of the city’s homes and businesses.

The decision does not change the terms of the settlement, although Warwick argued earlier this month that the increases be phased in over a greater period of time.

In an interview earlier this month Timothy Brown, KCWA general manager, said the rate increases are critical to implementing a new meter reading system for 24,000 customers at a projected cost of $6.6 million. Portions of the current system, he said, are 20 years old and replacing the system with radio-operated readers would enable the agency to read all its customers within a day and a half, giving it the capability of monthly billing should it choose. Under the existing reading system, it takes personnel three weeks to read about a third of its customers.

According to the terms of the agreement, the first rate hike would raise $2.8 million and the second would generate an additional $1 million. It also calls for the authority to file a request “to terminate the funding” relating to the meter replacement program no later than Oct. 1, 2019 that would take effect Jan. 1, 2020, “or whatever date the program funding is completed.”

The agreement further allows the authority to draw from its cash capital account in advance to the meter replacement program with the understanding those funds would be reimbursed from the program.

In arguing the rates should be implemented over an extended period, Warwick Mayor Scott Avedisian said the city “was not a party to the negotiations on the terms and conditions of the draft settlement agreement.”

In an email Wednesday he said, “As you know, it is difficult to understand why the cost of water for a small section of our city is much more expensive than the rest of the city. I think that we should be looking at state legislation that would better regulate the Authority. It might be time to revisit the idea of consolidating them into another public infrastructure agency.”