Water crisis ushers historical year for concessionaire

Published July 14, 2019, 12:00 AM

by manilabulletin_admin

By Madelaine B. Miraflor

As two dams simultaneously run out of water and the government starting to impose financial penalties on utilities, this year is certainly looking to be a historical year for both concessionaires and the Metropolitan Waterworks and Sewerage System (MWSS).

“It’s really a new era,” said Ferdinand Dela Cruz, the president and chief executive officer of Manila Water Company, Inc., which caught itself in two water supply mess so far this year — the first one costing it around P1.5 billion in fines and self-imposed penalty.

Metro Manila — home to more than 12 million people — gets its water supply from the Angat-Ipo-La Mesa water system.

Angat Dam currently supplies 97 percent of Metro Manila’s water needs, releasing about 4 million liters of water per day (mld), while La Mesa Dam is supposed to serve as a reserve for Manila Water.

Of the Angat Dam allocation, Manila Water gets an allocation of 1,600 mld, while Maynilad Water Services, Inc. is allowed to get the rest or about 2,400 mld.

Speaking to Manila Bulletin, Dela Cruz said it’s the first time that both Angat Dam and La Mesa Dam reached their critical water level at the same time and that both concessionaires have to simultaneously implement rotational water interruption.

Dela Cruz is blaming this to climate change, rising demand, and the delay of new water sources.

“You can’t fight nature but you can build new water resources,” he said.

To recall, Angat Dam also had its lowest water level in 2010, but Manila Water didn’t have to implement water supply interruption since there was enough water from La Mesa Dam at that time.

As for the financial penalties, MWSS-Regulatory Office (MWSS-RO) also stepped into an unfamiliar territory this year when Metro Manila’s water crisis started.

Manila Water faced a shortage in its water supply last March when La Mesa Dam reached its critical level, forcing the Ayala-led company to implement days of low to no water supply interruption among its 1.2 million customers.

For a few days, MWSS-RO was in a limbo and MWSS Chief Regulator Patrick Ty was uncertain as to how the government will make Manila Water accountable for this.

Ty first admitted that MWSS could not impose administrative penalties to the company, saying he would instead ask the water utility to “do the right thing” and either implement a rebate or won’t charge its customers on days when they had no water.

“[To order Manila Water not to collect payments] is beyond MWSS-RO [MWSS-Regulatory Office]. But we would give them the moral pressure,” he said.

But as pressure mounted coming from the public and the government, MWSS-RO was still forced to recommend a penalty on Manila Water, which amounted to P534 million in fines and a financial commitment of P600 million to develop a new water source. This was later on approved by the MWSS Board of Trustees.

“It’s the first time [in the history of the concession],” Dela Cruz said. “We are not the root cause [of the water crisis] but we said we will just abide by the penalty.”

It was in 1997 when Manila Water entered into a concession agreement with MWSS to be the exclusive provider of water and used water services to the East Zone of Metro Manila and Rizal Province, consisting of 23 cities and municipalities.

Dela Cruz pointed out that when the deal was signed, the government promised that there will be a new major water source over the next 10 years, something that didn’t happen even 22 years later.

“Another new thing is what MWSS-RO did to Maynilad. It’s the first time that they penalized a concessionaire even if the interruption isn’t concession-wide,” Dela Cruz said.

He was referring to the recent decision of MWSS-RO to order Maynilad to implement a rebate to some of its customers in Barangay Captain Albert Aguilar (CAA) in Las Piñas City who experienced days of water interruption in May.

“It’s too localized,” Dela Cruz said.

Moving forward, Dela Cruz hopes that the government will finally come up with ways to address the water shortage by fast-tracking the approval of water projects and have them implemented.

He also wants National Water Resources Board (NWRB) to release a year-end projection for the water level of Angat.

“For the balance of the year, what we will have to deal with is rotational interruption. What we really have to plan is the next summer, 2020, which is dependent on the year-end level of Angat Dam,” Dela Cruz said.