MANILA, Philippines – Customers of Manila Water Company Inc. will have to shell out more money to pay for the higher water bills, while those of Maynilad Water Services Inc. will expect lower bills in the second quarter of 2021, the Metropolitan Waterworks and Sewerage System (MWSS) announced on Thursday.
In an advisory, MWSS chief regulator Patrick Ty said the MWSS Board of Trustees has approved the recommendation of the regulatory office (RO) to implement the 2021 second quarter foreign currency differential adjustment (FCDA) effective April 1, based on its evaluation of the FCDA proposals of the concessionaires.
The FCDA is a quarterly-reviewed tariff mechanism that allows concessionaires to recover losses or give back gains arising from fluctuations in foreign exchange rates, as payments are made for foreign currency-denominated loans that are used to fund the expansion and improvement of water and sewerage services.
It is a corrective mechanism formulated by the MWSS RO to avoid under-recovery or over-recovery caused by forex movements.
The MWSS said Manila Water, which services the east zone concession area, will implement an FCDA 0.84% or P0.24 per cubic meter of its 2021 Average Basic Charge of P28.52 per cubic meter.
“This is an upward adjustment of P0.05 per cubic meter from the previous FCDA of P0.19 per cubic meter,” the agency said.
West Zone concessionaire Maynilad, meanwhile, will apply an FCDA of negative 0.41% or negative P0.15 per cubic meter of its 2021 Average Basic Charge of P36.24 per cubic meter.
“This is a downward adjustment of P0.01 per cubic meter from the previous FCDA of negative P0.14 per cubic meter,” the MWSS said.
Ty explained that Manila Water’s FCDA increased as significant portions of the loans of Manila Water are in Japanese yen and in euros which appreciated against the Philippine peso.
On the other hand, the majority of Maynilad’s loans payable for this quarter are in US dollars. Ty noted that the peso appreciated against the US dollar which caused the rollback of P0.01 per cubic meter.