Customers of Maynilad Water Services, Inc. (Maynilad) stand to continue generating substantial savings on their water bills should the Metropolitan Waterworks and Sewerage System (MWSS) agree to extend their revised concession agreement (RCA) to 2047.
In the rate rebasing concluded last year, Maynilad and MWSS already assumed the extension of the concession in the determination of the tariff required to recover its expenditures. This resulted in a lower tariff adjustment of 35.61 percent, computed on a one-time basis, compared to 58.56 percent if the extension was not assumed.
This means that an average Maynilad residential customer who uses 30 cubic meters of water per month currently saves as much as PhP212 per month from the longer concession, since the RCA term extension was already assumed in the recent rate rebasing.
Extending the agreement strengthens Maynilad’s operational and financial capabilities, and enables it to provide consumers with affordable water service without undue uncertainty or delay.
With it, Maynilad will have a longer period of cost recovery, resulting in lower tariff increases. This reduction in the tariff increase translates to real savings for consumers, making water services more affordable and manageable for households and businesses alike.
“The extension represents a mutually beneficial arrangement for Maynilad and our valued customers. Beyond our commitment to ensuring a sustainable water future, it underscores our dedication to making our services more affordable to our consumers. By reducing the necessary tariff increase, we’re making water services more affordable, making life better for the communities we serve,” Maynilad President Ramoncito S. Fernandez said.
Additional PhP85B investment over 10-year extension
Currently, Maynilad operates under the RCA with MWSS, an agreement that is set to conclude on May 6, 2037. Under Republic Act 11600, struck on December 10, 2021, Maynilad’s franchise is slated to span a quarter-century, extending through to 2047.
“Aligning the RCA with our legislative franchise is a strategic and crucial step towards a sustainable water future. This foresight allows us to engage in long-term planning and substantial investment in our water infrastructure. With a clear vision towards 2047, we are in a stronger position to allocate our resources efficiently, particularly for significant projects and necessary improvements,” Fernandez explained.
Maynilad has outlined a massive PhP85-billion investment program for the 10-year extension, a plan that is hinged on elevating the quality of service to existing customers while broadening its operational scope.
It envisions a significant expansion of its water services, aiming to bring clean water to an additional 200,000 individuals. This expansion will extend its served population from 11.6 million people in 2037 to 11.8 million by 2047 within the designated concession area.
The company’s strategic vision also encompasses growth in both domestic and non-domestic customer bases, with ambitious plans to facilitate 40,383 new water service connections.
Recognizing the importance of infrastructure development, a substantial portion of the capital will be dedicated to replacing 250 kilometers of aging pipelines. This initiative is pivotal in the control of non-revenue water (NRW), with a target of water loss to 20 percent by 2030 and sustaining that level until 2047.
Maynilad forges ahead
Even as it pushes for the extension of its RCA, Maynilad is forging ahead with an ambitious investment program amounting to PhP222 billion, with a disbursement plan of about PhP163.3 through 2027.
Under the investment program, Maynilad is taking substantial steps to address multiple facets of water management and infrastructure, with a focus on ensuring the long-term availability and quality of water resources.
Key components of this endeavor include the establishment of 450 MLD (million liters per day) water treatment plants, 43 MLD modular treatment plants, and 90 MLD “NEW WATER” treatment plants. These facilities are poised to significantly augment the capacity to provide safe and clean water to the ever-expanding population.
Moreover, the plan encompasses the installation of approximately 55 kilometers of new primary water lines and the replacement of an extensive 639 kilometers of aging pipes.
Maynilad will also undertake the construction of five pumping stations and reservoirs while rehabilitating 17 existing ones, all of which are set to enhance the efficiency of water distribution.
The program also aims to replace 538,969 old water meters, to procure 24 state-of-the-art leak detection equipment, and to install 100 new hydrant meters while replacing 750 existing ones.
As part of its commitment to infrastructure maintenance, Maynilad will also repair 111,000 pipe leaks, a move that will significantly reduce water losses and ensure water quality standards are met.
On wastewater management, Maynilad’s program includes the expansion of sewer coverage and the augmentation of treatment capacity through the construction of six new sewage treatment plants, capable of handling an additional 420 MLD of wastewater. Simultaneously, it involves upgrading 14 wastewater facilities to comply with regulatory standards, with a particular emphasis on DAO 2021-19 Compliance.
Furthermore, the initiative includes the extension of sewer lines over a span of 121 kilometers, the desludging of 1,454,000 septic tanks, and the provision of an additional 10,000 sewer service connections.
By 2027, Maynilad has set ambitious targets, aiming to extend its service coverage to an estimated 103,084 new customers. This equates to approximately 700,000 individuals gaining access to potable water.
The program’s scope also entails the recovery of 585 million liters per day through leak mitigation, a notable increase of 122 million liters per day in treated sewage, and the expansion of sewerage coverage to at least five more cities.
Through these extensive projects, Maynilad is actively working towards reducing water loss to 25 percent by 2027, aligning with internationally accepted standards, as per the World Bank’s recommendation.
“Maynilad’s unwavering dedication to water sustainability and security stems from our strong sense of responsibility to the people and the planet. It is rooted in the desire to not only elevate service quality through innovative approaches. This commitment extends into the long-term, where Maynilad envisions a future with robust water resources,” Fernandez said.
