Water rates in Metro Manila and nearby provinces will be increasing starting October 1 as the peso depreciated against the dollar and other foreign currencies.

Water concessionaire for the west zone, Metro Pacific-controlled Maynilad Water Services Inc., said in a statement that customers could expect an average of P0.30 per cubic meter. This translates to an increase of P5.52 in the water bill of a family of five consuming an average of 30 cubic meters of water per month.

On the other hand, water concessionaire for the east zone, Ayala-owned Manila Water Co. Inc, said its customers could expect an average increase of 1.6 percent or P0.31 per cubic meter.

This will be the second-straight quarter that the utilities will increase their rates because of the depreciation of the peso.
In the second quarter, Manila Water raised its rate by P0.21 per cubic meter and Maynilad, by P0.22 per cubic meter, also because of the softening of the peso.

From an exchange rate of P42.90 to a dollar last quarter, the peso has slid to P44.88 to a dollar during the period factored in by the water utilities for increasing their rates.

A weaker peso pulled up the Foreign Currency Differential Adjustment, or FCDA, component in the water bills of the utilities’ customers. The FCDA is a tariff mechanism used by utility companies to allow it to recover losses or give back gains from the fluctuating movements of the peso against other currencies.

Both concessionairs pay foreign-dominated Concession Fees to the Metropolitan Waterworks and Sewerage System (MWSS), as well as loans to fund projects that will expand and modernize water and sewerage services for its households, commercial and industrial consumers.

The Regulatory Office of the MWSS approved the higher FCDA rate last September 10, 2008.

Low-income households, residential customers consuming 10 cubic meters or less a month will be exempt from the adjustment.