The Philippine Water Supply SectorDevelopments and Challenges for the Real Estate IndustryBy Ramon Alikpala, Chairman MWSS21st Annual National CREBA ConventionPalawan, 19 October 2012

92.3 MillionWater Districts

MWSS

Private Operators

LGUs and otherunregulatedprivateoperators

No Access

18.5M

17 M

13.8 M

1.6 M

41.4 M

~ 500

MWSS + 2

~ 350

5000+

The Philippine Water Sector

• The water sector is characterized by:

• A fragmented regulatory environment impedes increasing coverage, improving service quality and the protection of water resources

• Many utilities are severely underperforming in terms of operations and finance

• Service provision is very widely scattered among more than 6,000 providers

• Many utilities are wholly dependent on groundwater sources which are being rapidly depleted

• Increasing demands from all users (domestic, industrial and agricultural)

• There is a lack of quality data on water resources, coverage, utility performance, water quality, etc.

• LGU run utilities are considered the poorest performers

• Sanitation is neglected

Relevant Water Agencies

• National Water Resources Board– Water Rights– Certificate of Public Convenience

• DENR – Environment Management Bureau (EMB)– Clean Water Act

• Department of Health (DOH)– National Drinking Water Standard

• Metropolitan Waterworks and Sewerage System (MWSS)– Manila Water / Maynilad

• Local Water Utilities Administration– Water Districts

• Laguna Lake Development Authority– Environmental Users Fee– Water Rights from Laguna Lake

Relevant Water Laws & PoliciesRA 9275 (2004)

The Philippine Clean Water Act of 2004• Sec. 8. Domestic Sewage Collection, Treatment and Disposal

- …the Agency vested to provide water supply facilities in MM and other HUC, in coordination with LGUs, shall be required to connect the existing sewage line found in all subdivisions, condominiums, commercial centers…

Relevant Water Laws & PoliciesPD 1345 (1978)

Empowering the MWSS to Take Over the Centralized Water Supply Systems in Residential Subdivisions within its Territorial Jurisdictions

– Sec. 2 Upon takeover of the system, the MWSS shall evaluate such system considering the adequacy, potability and other prevailing conditions.…The cost to render the system operable shall be chargeable to the subdivision owner/developer…

Relevant Water Laws & PoliciesMWSS IRR No. 2008-02

Description Rate Classification Billing Scheme

Purely Residential (100%)

Residential Billing of master meter is based on the actual average consumption using the residential rate

At least 75% Residential

Semi-Business Billing of master meter is based on the actual average consumption using semi-business rate (weighted average rate of residential and commercial units)

Less than 75% Residential

Commercial Billing of master meter is based on the actual consumption using commercial rate

Relevant Water Laws & PoliciesPD 198 (1973)

Provincial Water Utilities Act of 1973

• Sec. 39. Production Assessment. In the event the Board of the district finds, after notice and hearing, that production of groundwater by other entities within the district for commercial or industrial uses is injuring or reducing the district’s financial condition, the board may adopt and levy a groundwater production assessment to compensate for such loss.

Relevant Water Laws & PoliciesMCWD vs. Adala (2007)

• “Since Section 47 of PD. 198, which vests an “exclusive franchise” upon public utilities, is clearly repugnant to Article XIV, Section 5 of the 1973 Constitution, it is unconstitutional and may not, therefore, be relied upon by petitioner in support of its opposition against respondent’s application for CPC and the subsequent grant thereof by the NWRB.”

Growth Areas

• Desalination

• Rain Water Harvesting

• Recycling

SepticTank

SepticTank

SEPTAGE

Growth AreasSeptage Management

Growth Areas

• Bulk Water Supply

– Providing water from source (e.g. river) to utility

• Professional Private Operators

– Operation of LGUs & small utilities (including subdivisions) by private independent operators