By Arra B. Francia, Reporter
CUSTOMERS served by Metro Manila’s two water concessionaires will notice a slight increase in their bills starting Jan. 1, after the Metropolitan Waterworks and Sewerage System (MWSS) approved rate adjustments based on inflation and the movement of the peso against the US dollar.
MWSS Chief Regulator Patrick Lester N. Ty said on Friday that its board of trustees has approved a net upward adjustment of 64 centavos per cubic meter (cu.m.) for east zone concessionaire Manila Water Company, Inc., and a P1.48 per cu.m. hike for west zone concessionaire Maynilad Water Services, Inc.
“(These adjustments) were approved by the board of trustees yesterday (Thursday night) and will be published on Dec. 16 and to be effective Jan. 1, 2019,” Mr. Ty said in a press conference in Quezon City on Friday. MWSS reviews water rates every quarter.
Manila Water takes into account an upward of adjustment of P1.54 per cu.m for inflation, and a decrease of 90 centavos for foreign currency differential adjustment (FCDA).
This indicates a P3.34 increase in the water bills of customers with a monthly billed volume of 10 cu.m. or less; P7.39 for those with 20 cu.m., and P15.01 for those with 30 cu.m.
Meanwhile, the increase for Maynilad is based on a P1.95 per cu.m. increase due to inflation, tempered by 47-centavo decrease for FCDA.
Customers with a monthly billed volume of 10 cu.m. or less will pay an additional P5.30. Those using 20 cu.m. will pay P20.08 more, while those using 30 cu.m. will pay P41.02 more.
Mr. Ty noted that the adjustment due to inflation is based on the 5.7% inflation print recorded last July.
“Based on the concession agreement, it’s the inflation rate as of July. That will be the one used for the purposes of any adjustment in Jan. 1 the following year,” he explained.
The FCDA is a mechanism used by the MWSS and the service concessionaires to provide them a “no gain, no loss” principle. Concessionaires pay foreign currency-denominated concession fees to the MWSS, in addition to loans used to finance service improvement projects.
“Any foreign loan exposure they have will result to an FCDA adjustment. So for example any movement in the peso versus the Japanese yen or US dollars and the euro will result in an adjustment. If the peso is appreciating, then that means the FCDA will result in a negative adjustment. If the peso is depreciating, it will result in an upward adjustment,” Mr. Ty explained.
The chief regulator also noted that the FCDA could post a downward adjustment should the peso continue to appreciate against the US dollar.