December 28, 2014

MWC and Maynilad to adjust rates for FCDA

Manila Water Co (MWC), through a disclosure, said it has secured regulatory approval to implement a P0.36 per cubic meter (m3 its water rates to reflect adjustments for foreign exchange fluctuations. The Foreign Currency Differential Adjustment (FCDA), based on exchange rates of P44.7979/USD and P0.04156/JPY, will raise the FCDA component of the water bill to 1.32% of the basic charge of P27.75.

Metro Pacific Investment Corp (MPI) subsidiary Maynilad Water Services Inc (Maynilad) will also implement a 1.12% FCDA on its basic charge of P33.97/m3. Both rate adjustments will take effect in January next year. P0.38/m3 While the regulator has ordered water rates to be maintained last year pending resolution of its ongoing arbitration case with the concessionaires, MWC said the Metropolitan Waterworks and Sewerage System (MWSS) recently ruled that the FCDA is a separate tariff mechanism not covered by the rate rebasing process.

The FCDA is a pass-through tariff mechanism that is implemented quarterly to account for foreign exchange losses or gains arising from the payment by the concessionaires of various loans and borrowings and thus will not impact the overall profitability of the companies. - WealthSec