Water rates for the Western section of the Metro Manila and some parts of Cavite are set to go up as the Appeals Panel of the Metropolitan Waterworks and Sewerage System upheld the alternative rebasing adjustment of Maynilad Water Services Inc.
In a disclosure to the stock exchange on Monday, Metro Pacific Investments Inc. said that this will result in a 9.8 percent increase in the 2013 average basic water charge of P31.28 per cubic meter, inclusive of the P1.00 Currency Exchange Rate Adjustment which the MWSS has now incorporated into the basic charge.
Metro Pacific and DMCI Holdings Inc. own Maynilad which provides water services to the west zone of Manila and some parts of Cavite province.
Metro Pacific said that the Appeals Panel’s decision translates to an average increase of P 3.06 per cubic meter.
For a typical household whose monthly water consumption is 20 cubic meters, this would mean an increase in the average water charge of P1.68 per cubic meter.
“This decision confirms that the Concession Agreement works, and restores investor confidence in the public-private partnership program of the Government. This also ensures the continued implementation of Maynilad’s capital expenditure projects that are intended to benefit further our customers,” said Maynilad President Ricky Vargas.
Maynilad said however that it is willing to implement the increase on a staggered basis in order to mitigate the impact of the Award on its customers in the West Zone of Metro Manila subject to approval of the MWSS.
In 2013, MWSS denied Maynilad’s petition for an upward adjustment by 28.35 percent of its average basic charge or P8.58 per cubic meter, and instead ordered a rate reduction of 4.82 percent or P1.46 per cubic meter.
Maynilad has filed a case questioning the new water rates imposed by MWSS before an international arbitration court.
Maynilad said under the concession agreement with the MWSS, which was guaranteed by the government, any disagreement, dispute, controversy or claim arising out of the agreement, which could be resolved through consultation or negotiation between the parties, must be resolved through a process called arbitration.
Last month however, MWSS approved the request of Manila Water Company and Maynilad Water Services to increase water rates as part of its foreign currency differential adjustment (FCDA).
MWSS said that for Manila Water customers, an additional P0.36 will be charged per cubic meter, which translates to an additional P20.26 for a household consuming about 30 cubic meters of water a month.
For Maynilad, P0.38 per cubic meter will be added, or about P9.15 additional payment for a 30-cubic meters of water.
The government however clarified that the increase in FCDA has nothing to do with the arbitration case.