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January 10, 2023

By
EDGAR

United States Securities and Exchange Commission

Division of Corporation Finance

Office of Energy & Transportation

100 F Street, Northeast

Washington, D.C. 20549

Attention: Steve Lo

 Craig Arakawa

    Re:
    Essential Utilities, Inc.

    Form 10-K for the Fiscal Year Ended December 31, 2021

    Filed March 1, 2022

    File No. 001-06659

Dear Gentlemen:

Essential Utilities, Inc. (the “Company”)
received a letter dated December 8, 2022 from the Division of Corporation Finance, Office of Energy and Transportation of the U.S. Securities
and Exchange Commission, commenting on the Company’s most recent Form 10-K filed with the Commission on March 1, 2022. Your comments
from the letter are repeated below, followed by the Company’s responses to the comments. The Company intends to comply with the
comments in all future filings, as applicable, but believes it would be confusing to our investors to amend the above-referenced Form
10-K at this time. The Company also believes the provision of the disclosure is not materially misleading and provides the investors
with useful additional information.

Item
7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Results
of Operations

Regulated
Natural Gas Segment, page 53

 1. We
                                            note that you subtract purchased gas expenses from revenues to arrive at your non-GAAP measure,
                                            “gross margin (non-GAAP)” and that you have identified operating revenues as
                                            the most directly comparable GAAP measure. Given this calculation subtracts an expense from
                                            revenues, it appears that your non-GAAP measure is more akin to a margin type measure that
                                            should be reconciled to gross margin as defined in GAAP. Please tell us why you have not
                                            identified gross margin as defined by GAAP as the most directly comparable GAAP measure and
                                            revise to provide a corresponding reconciliation that complies with Item 10(e)(1)(i)(B) of
                                            Regulation S-K.

Response:

We have considered the Staff’s comment
and we will remove the disclosure of “gross margin (non-GAAP)” in Management’s Discussion and Analysis of Financial
Condition and Results of Operations, beginning with our annual report on Form 10-K for the year ended December 31, 2022.

We had presented gross margin (non-GAAP)
as we believe it provides a meaningful basis to evaluate and analyze our regulated natural gas segment performance since the Company’s
operating revenues are affected by the cost of natural gas. Further, we believe the removal of purchased gas costs from operating revenues
provides a more direct year-over-year comparison of performance for investors, especially given the market volatility and fluctuation
in natural gas prices. The Company’s operating revenues includes revenues, or refunds of revenue, based upon a purchased gas adjustment
mechanism that has no margin and instead provides a dollar-for-dollar offset to either increases or decreases in our purchased gas expense.
The changes in the cost of purchased gas impacts operating revenues on a dollar-for-dollar basis without mark-up to utility customers.

We had reconciled gross margin (non-GAAP)
to operating revenues (GAAP) because it was believed to be the most directly comparable performance metric. We do not report gross margin
in our consolidated financial statements as we do not believe it is a meaningful and relevant measure for our industry. Instead of reconciling
gross margin (non-GAAP) to a financial measure that does not appear in our consolidated financial statements, we will remove the gross
margin (non-GAAP) disclosure and discussion, beginning with the Form 10-K for the year ended December 31, 2022.

Item
8. Financial Statements and Supplemental Data

Notes
to Consolidated Financial Statements

Note
18 – Segment Information, page 121

 2. We
                                            note you disclose operating income, income before income taxes and net income (loss) for
                                            each of your reportable segments. Considering you disclose more than one measure of segment
                                            profit or loss, please revise to disclose only one measure that you believe is determined
                                            in accordance with the measurement principles most consistent with those used in measuring
                                            the corresponding amount in the consolidated statements of operations. Refer to ASC 280-10-50-28.
                                            In addition, to the extent that the measures that are not identified as the segment measure
                                            of profit or loss under ASC 280 are presented outside the consolidated financial statements,
                                            please label them as non-GAAP financial measures and provide the required disclosures under
                                            Item 10(e) of Regulation S-K.

Response:

We have considered the Staff’s
comment and will revise our disclosure in the Notes to Consolidated Financial Statements, Note 18 – Segment Information,
beginning with our annual report on Form 10-K for the year ended December 31, 2022. We will revise the disclosure to disclose only
one measure of segment performance that we believe to be determined in accordance with the measurement principles most consistent
with those used in measuring the corresponding amount in the consolidated statements of operations. In referring to ASC
280-10-50-28, the Company’s chief operating decision maker primarily uses one measure of a segment’s profit or loss, and
the measure is determined in accordance with the measurement principles most consistent with those used in measuring the
corresponding amounts in the Company’s consolidated financial statements. The measure selected to be disclosed in future
filings is determined to be net income (loss) for each reportable segment, and the other two measures, “operating
income” and “income before income taxes”, are of lesser importance and will not be disclosed. Based on the 2021
table that presents information about the Company’s reportable segments which is included in the Segment Information footnote
on page 121 of the 2021 Form 10-K, the Company proposes the following revised table going forward:

The following table presents information
about the Company’s reportable segments as of and for the years ended December 31,:

    2021
    Regulated

Water
    Regulated

 Natural Gas
    Other and

Eliminations
    Consolidated

    Operating revenues
    $ 980,203
    $ 859,902
    $ 38,039
    $ 1,878,144

    Operations and maintenance expense
      332,598
      226,194
      (8,212 )
      550,580

    Purchased gas
      —
      313,390
      26,872
      340,262

    Depreciation and amortization
      182,074
      113,238
      2,640
      297,952

    Interest expense, net(a)
      108,356
      75,628
      21,341
      205,325

    Allowance for funds used during construction
      (19,258 )
      (1,534 )
      —
      (20,792 )

    Provision for income taxes (benefit)
      26,633
      (40,013 )
      3,768
      (9,612 )

    Net income (loss)
      293,703
      148,193
      (10,284 )
      431,612

    Capital expenditures
      621,595
      397,419
      1,505
      1,020,519

    Total assets
      8,403,586
      5,960,602
      294,090
      14,658,278

In addition, we confirm that to the extent
that the measures which are not identified as the segment measure of profit or loss under ASC 280 are presented outside of the consolidated
financial statements, then these measures will be removed from our disclosure in future filings, beginning with the annual report on
Form 10-K for the year ended December 31, 2022.

Based on the 2021 table that presents information
about the Company’s Regulated Water segment which is included in the Management’s Discussion and Analysis of Financial Condition
and Results of Operations on page 50 of the 2021 Form 10-K, the Company proposes to remove operating income and income before income
taxes as reflected in the following revised table beginning with the annual report on Form 10-K for the year ended December 31, 2022:

    2021
    2020
    2019
    2021 vs. 2020
    2020 vs. 2019

    Operating revenues:

    Residential water
    $ 561,996
    $ 567,485
    $ 518,192
    $ (5,489 )
    $ 49,293

    Commercial water
      151,071
      143,479
      145,599
      7,592
      (2,120 )

    Industrial water
      30,230
      29,764
      30,667
      466
      (903 )

    Other water
      89,472
      67,712
      72,942
      21,760
      (5,230 )

    Wastewater
      132,316
      121,117
      105,204
      11,199
      15,913

    Customer rate credits
      —
      (4,080 )
      —
      4,080
      (4,080 )

    Other utility
      15,118
      13,063
      13,826
      2,055
      (763 )

    Total operating revenues
      980,203
      938,540
      886,430
      41,663
      52,110

    Operating expenses:

    Operations and maintenance expense
      332,598
      309,608
      315,052
      22,990
      (5,444 )

    Depreciation and amortization
      182,074
      171,152
      155,898
      10,922
      15,254

    Taxes other than income taxes
      63,264
      60,505
      59,955
      2,759
      550

    Other expense, net
      81,931
      91,001
      81,872
      (9,070 )
      9,129

    Provision for income taxes (benefit)
      26,633
      22,481
      (1,267 )
      4,152
      23,748

    Segment net income
    $ 293,703
    $ 283,793
    $ 274,920
    $ 9,910
    $ 8,873

In a similar manner, based on the 2021 table
that presents information about the Company’s Regulated Natural Gas segment, which is included in the Management’s Discussion
and Analysis of Financial Condition and Results of Operations on page 52 of the 2021 Form 10-K, the Company proposes to remove operating
income and income before income taxes as reflected in the following revised table beginning with the annual report on Form 10-K for the
year ended December 31, 2022:

    2021
    2020 (a)
    2021 vs. 2020

    Operating revenues:

    Residential gas
    $ 530,338
    $ 314,274
    $ 216,064

    Commercial gas
      99,596
      50,239
      49,357

    Industrial gas
      3,427
      6,923
      (3,496 )

    Gas transportation
      198,195
      133,685
      64,510

    Customer rate credits
      (5,000 )
      (18,924 )
      13,924

    Other utility
      33,346
      20,367
      12,979

    Total operating revenues
      859,902
      506,564
      353,338

    Operating expenses:

    Operations and maintenance expense
      226,194
      198,383
      27,811

    Purchased gas
      313,390
      154,103
      159,287

    Depreciation and amortization
      113,238
      84,201
      29,037

    Taxes other than income taxes
      20,801
      13,307
      7,494

    Other expense, net
      78,099
      25,252
      52,847

    Income tax benefit
      (40,013 )
      (25,133 )
      (14,880 )

    Segment net income
    $ 148,193
    $ 56,451
    $ 91,742

In future filings, if in the event we determine
that there are measures of this type outside of the consolidated financial statements, and it is decided to disclose these measures because
they are believed to be meaningful to our investors, then we will label them as non-GAAP financial measures and provide the required
disclosures under Item 10(e) of Regulation S-K.

*******

We hereby acknowledge we are responsible
for the accuracy and adequacy of the disclosures, notwithstanding any review comments, action or absence of action by the staff.

If you would like to discuss our responses
to the Staff’s comments or if you would like to discuss any other matters, please contact me at 610-645-4266 or by email at DJSchuller@essential.co.

Sincerely,

/s/ Daniel J. Schuller

Daniel J. Schuller

Chief Financial Officer