MANILA, Philippines — Customers of the Maynilad Water Services Inc. will now enjoy a 10-percent drop in the average rate per cubic meter instead of the previously announced hike resulting from fluctuations in the foreign exchange rate.
The concessionaire for water services in Greater Manila Area’s west zone said on Thursday the average rate would decrease by P4.79 per cubic meter, thanks to a P978-million gain in a financing transaction that was closed last March.
Back then, when the peso traded at an average of P40.71 to a US dollar, Maynilad refinanced over $120 million in loans. It took the firm some three months to figure out the exercise’s impact on rates.
The new forex-influenced rate adjustment, which will take effect on July 6 and will be good until yearend, already takes into account the 17-centavo hike announced earlier this week.
This reduction will be reflected in the bills for August until January 2014.
Last Monday, Maynilad announced that its average rates would slightly increase in the third quarter due to the weakening of the peso against other currencies.
But now, average and all-in rates including value-added tax and other charges will go down to P41.77 per cubic meter from P46.56.
Lifeline customers who consume 10 cubic meters or less every month will pay P11.01 less in their August bill. The average household, which use up to 30 cubic meters, will enjoy a reduction of P85.32 in their total bill.
Under the concession agreement with the government, Maynilad must pass on to customers the gains or losses arising from the payment of foreign currency-denominated loans from banks and concession fees.
Rates adjustments related to foreign exchange changes do not affect the company’s revenues and net income.
Regulators are currently reviewing a proposal from the two concessionaires, the other being Manila Water Co. Inc., which both want to raise their basic charges.
Manila Water wants an additional P5.83 per cubic meter while Maynilad is shooting for an increase of P8.58.
Originally posted at 5:20 p.m.