MWSS approves water rate hike of Manila Water, Maynilad in 2024

The Metropolitan Waterworks and Sewerage System (MWSS) said Wednesday it has approved rate hikes of both Manila Water Company Inc. and Maynilad Water Services Inc. next year.

MWSS Regulatory Office chief regulator Patrick Lester Ty said the adjustments that will be implemented — an average ranging from P6.41 to P7.87 per cubic meter (/cu.m.) — starting January 2024 take into consideration inflation, as well as the spending program undertaken by the water concessionaires.

"We did the tariff adjustments in tranches to ensure that the public will be protected and it will not be too burdensome to do it all in one go, [and] to ensure that Manila Water and Maynilad will be doing their capex (capital expenditure) rollout projects and ahead of schedule actually, hopefully," he said.

He added that, "Part of the reason is we need to prepare for the El Niño that will be happening in 2024… and we have started preparing for that, and we have directed Manila Water and Maynilad to ensure that there will be no water crisis and to mitigate all the effects of El Niño next year."

As part of the second tranche of the rate rebasing, both concessionaires will be able to hike their rates from 2023 to 2027, provided that they meet MWSS' criteria such as spending for programs that ensure water security. The first tranche was implemented earlier this year.

Manila Water

East zone concessionaire Manila Water has been given the go-ahead to hike the average basis charge by P6.41/cu.m. to P42.26/cu.m. in 2024 from P35.85/cu.m. this year. The adjustment includes P1.27/cu.m. for inflation, and P5.14/cu.m. for its spending program.

This will translate to an estimated upward adjustment of P2.96 per month for low-income lifeline customers, P34.12 for those consuming 10 cu.m. per month, P76.68 for those consuming 20 cu.m. per month, and P154.55 for those consuming 30 cu.m. per month.

Based on its report to the MWSS, Manila Water has spent some P11.283 billion as of October 2023 — P1.388 billion for service continuity, P3.632 billion for service accessibility, P3.528 billion for water security, and P2.734 billion for environmental sustainability.

Among its projects are the P3.801-billion Wawa-Calawais Phase 1, which has a capacity of 80 million liters per day (MLD); the P2.735-billion East Bay Phase 1 with a 50 MLD capacity; and, the P7.849-billion East Bay Phase 2 with a 200 MLD capacity.

Maynilad

On the other hand, west zone concessionaire Maynilad will hike its rates by P7.87/cu.m. to P47.57/cu.m. in 2024 from P39.70/cu.m. in 2023. This takes into account P1.40/cu.m. for inflation, and P6.47/cu.m. for capital spending.

The adjustments will translate into an additional P4.74 per month for low-income lifeline customers, P26.61 for regular lifeline customers, P100.67 for those consuming 20 cu.m. per month, and P205.87 for those consuming 30 cu.m. per month.

According to the MWSS, Maynilad has so far spent P16.653 billion as of October 2023 — P3.191 billion for non-revenue water (NRW) management, P38.32 million for expansion services, P4.121 billion for operations support programs, P4.397 billion for water sources programs, P4.255 for sewerage programs, P20.04 million for sanitation programs, and P630.09 million for customer service and information capex.

Its projects include the P11.60-billion Poblacion Water Treatment Plant with a capacity of 150 MLD, the P617-million Putatan Treatment Plant with 20 MLD, the P329-million Parañaque New Water Treatment Plant and expansion with 5 MLD, and the P106-million Julian Treatment Plant improvement with 3 MLD.

El Niño threat

According to Ty, the rate adjustments are "affordable" and "necessary," as this would ensure that services will continue to be available amid the El Niño or the abnormal warming of the sea surface temperature, which officially started in July this year.

"We feel that the public, of course, it's still an added burden, but we feel that this is a necessary burden because what is more important is to ensure that the proper service is given to the consumers, and there will be water on tap, especially with the looming El Niño," he said.

"I'm asking the public for their understanding. Ang mas importante dito ay tama po 'yung serbisyo kasi po ang problema, kapag 'di po natin ginawa itong tariff adjustment, baka magkaproblema po tayo at hindi ma-provide ang tamang serbisyo sa ating consumers," he added.

(What is more important here is the service because the problem is if we don't do this tariff adjustment, this might cause problems and the services would not be provided to the consumers.)

The World Meteorological Organization (WMO) expects the El Niño to last until at least April 2024.

For its part, the National Irrigation Administration (NIA) has projected a 1.5-million metric ton (MT) loss in palay or unmilled rice.

Aside from assessing that the project commitments of Manila Water and Maynilad are being completed, the MWSS said it also directed both concessionaires to do a cross-border arrangement.

Under the agreement, Manila Water will be providing its excess water supply to Maynilad at the border of the two concession areas, providing an additional 47 MLD.

"The reason for this is this 47 MLD is now guaranteed, unlike before that it's not guaranteed and it's only about availability, but Manila Water has agreed to commit 47 MLD to Maynilad to help them provide their services to their customers," Ty said.

"This is very important because majority of the time, both Manila Water and Maynilad have a hard time reaching the end of their transmission lines so majority of the time, the customers in this area are having problems with their water pressure so this will help provide water pressure to these customers in this area," he added. — VDV, GMA Integrated News