Maynilad Water Services Inc. said Monday it is seeking a 10-year extension of its revised concession agreement (RCA) with state-run Metropolitan Waterworks and Sewerage System (MWSS) until 2047.
The company said the extension is necessary to allow it to recoup investments and generate substantial savings for its customers.
“The extension represents a mutually beneficial arrangement for Maynilad and our valued customers.
Beyond our commitment to ensuring a sustainable water future, it underscores our dedication to making our services more affordable to our consumers. By reducing the necessary tariff increase, we’re making water services more affordable, making life better for the communities we serve,” Maynilad president Ramoncito Fernandez said.
Maynilad and MWSS, in the rate rebasing concluded last year, assumed the extension of the concession in the determination of the tariff required to recover its expenditures. This resulted in a lower tariff adjustment of 35.61 percent, computed on a one-time basis, compared to 58.56 percent if the extension was not assumed.
This means that an average Maynilad residential customer who uses 30 cubic meters of water a month saves as much as P212 per month from the longer concession.
Maynilad said extending the agreement strengthens its operational and financial capabilities and enables it to provide consumers with affordable water service without undue uncertainty or delay. Othel V. Campos
Maynilad’s current RCA with MWSS is set to expire on May 6, 2037. Under Republic Act 11600, Maynilad’s franchise is effective for 25 years. The extension through to 2047 is allowed under the law.
“Aligning the RCA with our legislative franchise is a strategic and crucial step towards a sustainable water future. This foresight allows us to engage in long-term planning and substantial investment in our water infrastructure. With a clear vision towards 2047, we are in a stronger position to allocate our resources efficiently, particularly for significant projects and necessary improvements,” Fernandez said.
Maynilad announced an investment program amounting to P222 billion, with a disbursement plan of about P163.3 through 2027.
The company outlined an P85-billion investment program for the 10-year extension, a plan that is hinged on elevating the quality of service to existing customers while broadening its operational scope.
It aims to expand its water services to bring clean water to an additional 200,000 individuals. The expansion will extend its served population from 11.6 million people in 2037 to 11.8 million by 2047 within the designated concession area.
The company said its strategic vision also encompasses growth in both domestic and non-domestic customer bases, with ambitious plans to facilitate 40,383 new water service connections.
It said it would use a big portion of the capital to replace 250 kilometers of aging pipelines. The initiative is pivotal in the control of non-revenue water (NRW), with a target of reducing water loss to 20 percent by 2030 and sustaining that level until 2047.