Water tariff seen in Aug
THE Metropolitan Waterworks and Sewerage System-Regulatory Office (MWSS-RO) is eyeing to set an indicative water tariff by the end of July, its chief said on Tuesday.
“We are on track to arrive at an indicative tariff by July 31,” MWSS Chief Regulator Patrick Lester Ty said in a text message.
Last month, the MWSS-RO held its public consultation on the 4th rate rebasing petition of water concessionaires Manila Water Co Inc. and Maynilad Water Services Inc. in Quezon City.
Rate rebasing is the process of adjusting water rates every five years to determine rates for water and sewerage services of Manila Water and Maynilad based on the performance, expenses, earnings, unrecovered investments and service improvement plans of both water providers. This is part of the concession agreement struck by the MWSS with Manila Water and Maynilad.
Ty said the agency is planning to hold another public consultation by the end of August or early September this year.
The MWSS-RO head made the comment as consumer group Laban Konsyumer Inc. made a formal request to release documents related to the rate rebasing petition of the two water firms.
This is in compliance with the July 11, 2018 letter sent by Ty to the LKI, stating that LKI should made its request by filling out a request for information form as required by the Freedom of Information (FoI) Law.
Based on the letter, the MWSS-RO is targeting to upload the business plans of Manila Water and Maynilad by August 1.
The LKI said the letter, which the MWSS-RO received on July 9, is requesting data covering the concessionaires’ business plans for first to third rate rebasing petitions applied for, and granted by the regulatory agency.
It is also requesting data covering the current fourth rate rebasing petition now under evaluation by the agency, including historical cash flows from 2013-1017, future cash flows up to 2037, amount of corporate income tax included and excluded in the water rate, system losses, audited financial statements and corporate income tax returns for the past five years and the MWSS contract with the consultants TCI Inc. and Constantino Guadalquiver & Co.
“Water is an indispensable item in every consumer’s daily life and therefore, the equity, or inequity, of the rates applied on the cost of the services of the water delivered to the consumers is also of significant importance and must be understood by, and justified to, the consumers,” LKI President Victorio Mario Dimagiba said also on Tuesday.
Dimagiba, a former Trade undersecretary, said the documents should help consumers understand the process and provide an equitable evaluation and determination of the current petitions from Maynilad and Manila Water.
In a chance interview last month, Ty said the rate rebasing may not be implemented next month as planned.
“Ang target ko [to implement the rate rebasing] is August but to be honest,
mukhanghindi [My target to implement the rate rebasing is August but to be honest, it is unlikely],” MWSS-RO Chief Regulator Patrick Lester Ty told reporters at the time.
Ty implied the likelihood of higher water rates because of the expense of putting up sewerage treatment plants (STPs) by the two concessionaires.
“What if the projects they want to implement like sewerage was not approved and it was deferred to something similar, then there might be a rollback,” he said.
STPs are being taken into account for the rate rebasing.
Manila Water and Maynilad are securing regulatory approval for the expansion of their respective STPs over the next five years.
Manila Water is planning to spend P37.44 billion to bolster the capacity of its sewage treatment plants by 725 million liters per day) until 2022 and another P116 billion to boost its capacity by 222 MLD for the remainder of its concession agreement.
Maynilad is intending to set aside P30.19 billion to boost the capacity of its sewage treatment facilities by 320 MLD until 2022 and another P101.45 billion to improve its capacity by 1,128 MLD for the rest of its concession agreement.