About Your Invoice (Water Bill)
Beginning in April 2025, the “Statement of Account” will be referred to as an “Invoice” in accordance with the Ease of Paying Taxes Act (EOPT Law), also known as Republic Act No. 11976.
The “Invoice” is the monthly water bill that is issued to customers. It reflects the customer’s monthly consumption and billing, including the breakdown of charges.
Know More About the Different Components of Your Monthly Water Bill
Discover the various components of your water bill right here! Just click the green buttons to jump to the section you want to explore further.cv
Front Page
Service Information
This section shows your contact information, including the Contract Account Number (CAN) or the unique eight-digit identifier designated to your account to distinguish it from all other accounts. This information must be kept confidential.
- The INV # was previously the SOA document number. The invoice number pertains to the inclusive series number of the issued water bill.
- Changed the label from “Statement of Account” to “Invoice.”
Metering Information
This section provides basic details about your water meter, and specifies the meter’s reading of your current consumption, which is the basis for all billing charges. Your account’s consumption in the previous three months is also shown here.
- The Reading Date, Present Reading and Previous Reading is now arranged horizontally.
- The Consumption displays the Quantity (Qty), Unit of measurement in cubic meters (cu.m.) and Description (Desc) of the reading (Actual, Average, Adjusted).
Payment History
This shows your recent payment history.
Billing Summary
The breakdown of all charges can be found in this section.
- Changed the “Total Amount Due” to “Amount Due”.
Reminder
This section contains payment and/or service reminders for customers.
Back Page
Service Invoice
Other charges such as Miscellaneous Fees, Reopening Fees, Installation Fees, Illegal Fees, Guaranty Deposits, etc., are included in this section. This will only be issued if applicable.
Credit Memo
In case of a reversal for Miscellaneous Charges, a Credit Memo (CM) will be issued to the consumer in conjunction with the water invoice.
1. Service Information
This section shows your contact information, including the Contract Account Number (CAN) or the unique eight-digit identifier designated to your account to distinguish it from all other accounts. This information must be kept confidential.
- The INV # was previously the SOA document number. The invoice number pertains to the inclusive series number of the issued water bill.
- Changed the label from “Statement of Account” to “Invoice.”
2. Metering Information
This section provides basic details about your water meter, and specifies the meter’s reading of your current consumption, which is the basis for all billing charges. Your account’s consumption in the previous three months is also shown here
- The Reading Date, Present Reading and Previous Reading is now arranged horizontally.
- The Consumption displays the Quantity (Qty), Unit of measurement in cubic meters (cu.m.) and Description (Desc) of the reading (Actual, Average, Adjusted).
3. Payment History
This shows your recent payment history.
4. Billing Summary
The breakdown of all charges can be found in this section.
Changed the “Total Amount Due” to “Amount Due”.
5. Reminder
This section contains payment and/or service reminders for customers.
6. Service Invoice
Other charges such as Miscellaneous Fees, Reopening Fees, Installation Fees, Illegal Fees, Guaranty Deposits, etc., are included in this section. This will only be issued if applicable.
7. Credit Memo
In case of a reversal for Miscellaneous Charges, a Credit Memo (CM) will be issued to the consumer in conjunction with the water invoice.
Billing Summary
Basic Charge covers the cost of operating, maintaining, improving and expanding the distribution network, as well as the facilities that bring potable water to customers. It is based on the latest approved tariff schedule.
Foreign Currency Differential Adjustment (FCDA) is a tariff mechanism granted to Maynilad to recover or compensate for fluctuations, as the case may be, in the foreign exchange rates arising from Maynilad’s payment of foreign currency-denominated (i) Concession Fees to MWSS, and (ii) loans that Maynilad obtained for its service improvement projects.
Environmental Charge (EC) covers the cost for wastewater treatment, or the removal of harmful chemicals and nutrients from wastewater before it is discharged to bodies of water. This is important to mitigate ecological damage and to promote environmental protection.
Sewerage Charge (SC) is 20% of Basic Charge for Commercial and Industrial customers connected to a sewer line. This charge is not levied on Residential and Semi-Business customers, or on Commercial and Industrial customers who are not connected to the sewer line.
Maintenance Service Charge (MSC) covers the maintenance of the water meter, and is based on the size of the installed meter.
Government Taxes consist of the 2% National Franchise Tax, and the Local Franchise Tax implemented by the respective local government units where the Business Area offices of Maynilad are located. This will be remitted to the national and local government (BIR for the National Franchise Tax and LGU for the Local Franchise Tax).
Previous Unpaid Amount pertains to charges billed prior to the billing period, and should be settled immediately together with the current charges to avoid disconnection of the water service.
Amount Due reflects the Current Charges (water) and Previous Unpaid Amount. This does not include other charges such as Miscellaneous Charges, Reopening Fee, Installation Charges, Illegal Charges, Guaranty Deposit as these will be segregated under the Service Invoice.
Payment Due Date is the deadline for paying the Total Amount Due.
Tariffs and Rates
To ensure that Maynilad has the ability to sustain its operations and expand its services, it charges a water tariff that will allow it to gradually recover its investments, including its government-regulated profits.
The tariff follows a socialized structure so that those who consume less water are charged lower rates. Those who consume more water are charged higher rates.
Water consumers are also classified depending on the presence and nature of the economic activity in their house or establishment. Their classification determines what type of water rates will be applied to them, i.e., Residential, Semi-Business, Commercial, and Industrial.
Residential customers who consume 10 cubic meters (cu.m.) or less per month are entitled to discounted rates under Maynilad’s Lifeline Program. Qualified low-income customers may receive even higher discounts under the Enhanced Lifeline Program (ELP), which starting January 2025 also covers consumption of up to 20 cu.m. per month. Meanwhile, Commercial, Industrial, and high-consuming customers are billed higher rates.
Understanding the Water Tariff
The water tariff refers to the rate charged to customers for water and wastewater services.
Under the Revised Concession Agreement (RCA), the Metropolitan Waterworks and Sewerage System (MWSS) Board sets the water tariff based on the recommendation of the MWSS Regulatory Office (MWSS-RO). The water tariff must reflect the cost of providing services and include a reasonable profit—defined as a return of up to 12%, in accordance with the RCA and the Philippine Amended Build-Operate-Transfer (BOT) Law—to ensure the continued sustainability of operations.
In essence, the water tariff follows a common pricing principle: Cost of Service + Reasonable Return = Tariff
1 Why does the tariff include a return?
Recovering the cost of service enables continued operations and service improvements. Meanwhile, earning a reasonable return incentivizes further investment—especially in a capital-intensive sector like water and wastewater.
For Maynilad, which operates under a long-term contract with the government, this return must be sufficient to ensure business sustainability throughout the duration of the contract, even if more lucrative investment options become available over time.
Thus, the tariff must balance affordability for consumers with financial viability for the Concessionaire.
2 How is the water tariff regulated?
To protect both the public interest and the financial health of the Concessionaires, the MWSS-RO reviews and adjusts the water tariff through a process called Rate Rebasing, conducted every five years. This process includes public consultations to solicit feedback and ensure that consumer sentiment is considered—not just the assessment of the regulator. This helps to ensure that:
- water and wastewater services remain safe, reliable, and affordable;
- Concessionaires continue investing in infrastructure and service improvements; and
- tariffs reflect actual and validated expenditures and returns.
3 How is Maynilad different from ordinary businesses?
Unlike ordinary businesses that may quickly recover costs and realize profits, Maynilad’s cost recovery is spread out over the term of the Concession Agreement. This gradual recovery prevents sudden, steep increases in customer bills.
Under the RCA, Maynilad is allowed to:
- earn a reasonable return, comparable to returns in similar industries under similar conditions
- fully recover expenditures efficiently and prudently incurred over the life of the concession and earn a 12% fixed nominal rate of return
This arrangement promotes affordable, stable tariffs while enabling sustained investment in long-term infrastructure development.
4 How is the tariff adjusted?
Below are tariff adjustments implemented, each designed to maintain fairness, service continuity, and financial viability:
1. Basic Water Tariff (every 5 years)
Through the Rate Rebasing process, Maynilad is allowed to recover part of its expenses and investments, plus the regulated return, based on validated historical and projected financial and operational data.
2. Inflation Adjustment (annual)
To offset the impact of inflation, the tariff is adjusted every year based on 75% of the change in the Consumer Price Index (CPI) for the Philippines, as published by the Philippine Statistics Authority.
This prevents the erosion of the value of the Concessionaire’s partial cost recovery over time.
3. Foreign Currency Differential Adjustment (FCDA – quarterly)
Maynilad services foreign-denominated loans, including those of MWSS, to finance major capital expenditures. Because these loans are sensitive to currency fluctuations, the FCDA allows tariff adjustments to account for movements in the peso’s value:
- Depreciation of the peso → possible tariff increase to offset forex losses
- Appreciation of the peso → possible tariff reduction to return forex gains to customers
The FCDA mechanism is guided by the principle of “no over- or under-recovery,” i.e., it is designed to neither generate profit nor incur loss for Maynilad. It is a pass-through adjustment that ensures only the actual foreign exchange impact is reflected in customer bills.
This adjustment applies to:
- MWSS loans being serviced by Maynilad;
- Maynilad’s own foreign loans contracted before June 29, 2022;
- Post-June 29, 2022 loans, but only in cases of extraordinary fluctuation in the exchange rate (i.e., more than 20%), and within a capped amount.
This mechanism ensures that foreign exchange risks are managed responsibly while protecting both Maynilad’s financial viability and customer interests.
4. Extraordinary Price Adjustment (as needed)
This adjustment applies only when the Concessionaire incurs significant additional costs due to a force majeure event that is not covered by insurance.
The MWSS-RO assesses the impact of the event on the Concessionaire’s cash flows, and the adjustment—whether positive or negative—is calculated accordingly. While the approach is similar to that of the FCDA, the Extraordinary Price Adjustment excludes adjustments due to foreign currency differential.
To protect customers from minimal increases, any computed adjustment between 0% and +1% is treated as 0 and not applied.
Rate Rebasing
Under their respective Revised Concession Agreements (RCA), water concessionaires Maynilad and Manila Water undergo Rate Rebasing every five (5) years.
Rate Rebasing is a review process that determines the appropriate rates for water and wastewater services. These rates are adjusted based on the Concessionaires’ performance, historical expenses, and future service improvement plans. The goal is to ensure that the rates:
- accurately reflect the true cost of delivering water and wastewater services, and
- allow the Concessionaires to recover their investments over the life of the concession.
1 Why is Rate Rebasing necessary?
Rate Rebasing balances the interests of water consumers, the government, and the Concessionaires.
- For consumers, it ensures continued access to safe and reliable water and wastewater services.
- For the government, it provides a mechanism to review and align the Concessionaires’ service obligations and investments with changing laws, environmental factors, and economic conditions.
- For the Concessionaires, it offers a fair and predictable environment where tariff adjustments follow a set schedule and are based on verified data and financial models.
Because Rate Rebasing uses cash flow analysis (i.e., inflow vs. outflow of funds), it allows for gradual rate adjustments, even when major investments are made. The government uses this process to ensure that Concessionaires:
- do not accumulate excessive profits or losses, and
- recover, over the life of the concession, all validated expenditures—including payments for concession fees and/or debt service on MWSS loans—and earn a fixed nominal rate of up to 12%.
2 How is Rate Rebasing done?
To protect both the public interest and the financial health of the Concessionaires, the MWSS-RO reviews and adjusts the water tariff through a process called Rate Rebasing, conducted every five years. This process includes public consultations to solicit feedback and ensure that consumer sentiment is considered—not just the assessment of the regulator. This helps to ensure that:
- water and wastewater services remain safe, reliable, and affordable;
- Concessionaires continue investing in infrastructure and service improvements; and
- tariffs reflect actual and validated expenditures and returns.
This is a rigorous, multi-step process involving the MWSS Regulatory Office (MWSS-RO), its technical consultants, and the two Concessionaires. The public is also involved through consultations, which help ensure that consumer concerns—such as willingness and ability to pay, and whether the proposed plans will adequately meet their service needs—are taken into account. These public consultations provide valuable inputs that complement the technical and financial assessments of the MWSS-RO.
1. Submission of Business Plan
Concessionaires submit their respective business plans, detailing (i) historical performance, (ii) service obligations, including service coverage and service level targets, (iii) past expenses, (iv) projected costs, (v) projected cash flows, and (vi) programs for the remainder of the concession period.
2. Validation and Disallowances
The MWSS-RO reviews the Concessionaires’ submitted business plans and supporting documents to determine whether reported expenses and projected costs were incurred or estimated prudently and efficiently. Only items that meet these standards are considered recoverable through the tariff. This validation process ensures that tariff calculations are based only on justifiable costs, and that inefficient or excessive expenses are disallowed—in line with government-approved accounting and auditing standards.
3. Review of Expenses
The MWSS-RO examines the submitted costs to ensure that these were incurred efficiently and prudently. Only validated expenses may be recovered through the tariff.
4. Adjustment of Service Obligations
The RO may revise the Concessionaires’ service targets based on current conditions and consultations.
5. Financial and Technical Forecasting
The MWSS-RO reviews the Concessionaires’ financial model, which includes assessments of past performance, assumptions used in the projections, and proposed service improvement targets. This review helps validate whether the Concessionaires’ forecasted revenues, expenses, and investment plans are realistic, efficient, and aligned with public service goals. Using statistical, financial, and technical methodologies, the MWSS-RO ensures that the projections form a credible basis for setting water tariffs over the remaining concession period.
6. Cash Flow Analysis
This ensures the Concessionaires neither over-earn nor under-recover, maintaining affordability for customers while protecting the concession’s viability.
7. Setting the Rates
Using financial modeling, the MWSS-RO sets the tariff that balances:
- affordability for customers, and
- reasonable returns for Concessionaires, allowing full cost recovery by the end of the concession.
8. Approval by the MWSS
Upon recommendation of the MWSS-RO, the MWSS determines the final adjustment in the tariff.
