Manila Water hikes rates

MANILA, Philippines - Beginning July 28, East Zone water concessionaire Manila Water Co. Inc. will implement a water rate increase of P0.39 per cubic meter, the firm said in a disclosure to the local bourse yesterday.

Manila Water said this is due to the adjustment in the Foreign Currency Differential Adjustment (FCDA) as approved by the Metro Manila Waterworks and Sewerage System (MWSS).

This adjustment is based on the exchange rates of $1 to P42.70 and 1 to P0.5253.

The FCDA component of the water bill will be adjusted from 1.71 percent to 3.19 percent of the basic charge.

The FCDA is a tariff mechanism formulated to account for foreign exchange losses or gains arising from the payment by Manila Water of concessional loans and foreign currency-denominated borrowings of the MWSS as well as loans of Manila Water for service expansion and improvement.

“The tariff adjustment has no impact on the projected net income of the company,” Manila Water said in the disclosure.

Manila Water published a notice last Friday of the rate increase, which is expected to be effective 15 days later.

The adjustment in FCDA was approved by the MWSS through a board resolution dated June 28, 2012.

Manila Water provides water and wastewater services to the following areas: Mandaluyong, Pasig, San Juan, Marikina, Pateros, Taguig, Makati, southeastern part of Quezon City, San Andres and Sta. Ana in Manila, as well as several towns of Rizal province including San Mateo, Rodriguez, Antipolo, Cainta, Angono, Baras, Binangonan and Jalajala.

Manila Water has submitted to the MWSS its new business plan for 2013 to 2017. Its current rate rebasing period ends this year.

If approved by the MWSS, Manila Water is expected to have new tariff rates by January. Discussions between the water firm and the regulatory body are expected to take place in the next two months.

Every five years, water concessionaires in Metro Manila file their business plans for approval of the MWSS. These plans contain the tariff rates imposed on customers as well as service and investment commitments.