MIWD: Proposed Water Rate Hike Still The ‘Lowest’

By Rjay Zuriaga Castor

The Metro Iloilo Water District (MIWD) said the proposed increase in the basic water rate to PHP 29 per cubic meter would not be burdensome to consumers, asserting that it remains the “lowest” among highly urbanized areas.

“Even if we increase it […] it is still the lowest in the system,” said MIWD General Manager Alfredo Tayo during a press conference on Friday, December 6.

Tayo noted that the increase is comparatively low when measured against similarly situated water districts in highly urbanized cities classified as Category A under Local Water Utilities Administration (LUWA) standards.

According to LUWA, Category A districts exhibit high operational efficiency, financial stability, and reliable water service. They serve large populations with adequate water supply systems.

Metro Pacific Iloilo Water (MPIW), a joint venture between MIWD and Metro Pacific Water (MPW), has proposed increasing the water rate from the current PHP 20 to PHP 29 per cubic meter.

MPIW argued that the adjustment is necessary to offset rising operational expenses since 2019.

The distributor highlighted several cost increases, including a 33% rise in bulk water prices, from PHP 13.81 to PHP 20.71 per cubic meter. Fuel costs jumped by 34%, from PHP 47.92 to PHP 64.25 per liter.

Material costs for 150-millimeter pipes surged by 74%, from PHP 3,022 to PHP 5,248. Chemical costs rose by 25%, from PHP 4,000 to PHP 5,000, while labor costs increased by 22%, from PHP 395 to PHP 480.

Tayo emphasized that MIWD has not imposed any rate increases in the past six years, partly due to the economic impacts of the COVID-19 pandemic.

However, with the rising prices of goods and services, MIWD acknowledged the need for rate adjustments to sustain operations and improve service delivery.

Tayo explained that the requested rate hike is primarily intended to cover operational expenses (OPEX) rather than capital expenditures (CAPEX).

CAPEX refers to funds allocated for acquiring, upgrading, or maintaining physical assets, including infrastructure like water treatment plants, pipelines, and equipment.

OPEX, meanwhile, involves regular expenses incurred within the same accounting period, such as employee salaries, electricity for pumping stations, and infrastructure maintenance.

MIWD has submitted all necessary documents to LUWA and expects approval by early 2025.

“From time to time what they do is after we have submitted, they will call our attention to certain details […] As far as we are concerned, we have completely submitted everything,” Tayo said.