Water rates go up Oct. 1 (Increase blamed on weaker peso versus US greenback)
Euan Paulo C. Añonuevo
Manila Times
Water rates in Metro Manila and outlying provinces are bound to go up starting next month because of the softening of the peso.
In separate statements on Monday, Manila Water Co. Inc. and Maynilad Water Services Inc. announced an impending increase in their water rates starting October 1.
Manila Water is the East Zone concessionaire of the Metropolitan Waterworks and Sewerage System (MWSS) and Maynilad, the West Zone concessionaire.
Manila Water said its customers could expect an average increase of 1.6 percent or P0.31 per cubic meter. Maynilad’s rate will rise by 0.45 percent or P0.10 per cubic meter.
In line with the government’s program to support low-income households, residential customers consuming 10 cubic meters or less a month will be exempt from the adjustment.
Both concessionaires attributed the impending increases to the weakening peso, which pulled up the Foreign Currency Differential Adjustment, or FCDA, component in the water bills of the utilities’ customers.
The differential is a tariff mechanism used to recover or account for the water utilities’ foreign-exchange gains or losses arising from their concession fees as well as foreign-denominated loans, which were used to fund their service expansion and improvement projects.
From an exchange rate of P42.90 to a dollar last quarter, the peso has slid to P44.88 to a dollar during the period factored in by the water utilities for increasing their rates.
The adjustment in both firms’ differentials was approved by the MWSS through Board Resolution 2008-193 dated September 11, 2008, as recommended by the MWSS Regulatory Office in its Resolution 08-015-CA dated September 10, 2008.
This will be the second-straight quarter that the utilities will increase their rates because of the depreciation of the peso.
In the second quarter, Manila Water raised its rate by P0.21 per cubic meter and Maynilad, by P0.22 per cubic meter, also because of higher differential.
Manila Water provides water services to the eastern part of Quezon City, Mandaluyong City, San Juan City, Marikina City, Pasig City, Pateros town and parts of Manila, Makati City and Rizal province.
Maynilad’s concession covers Pasay City, Parañaque City, Caloocan City, Muntinlupa City, Las Piñas City, Valenzuela City and parts of Manila, Quezon City and Cavite province.
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