Metro Pacific Investments Corp. reported easier funding access for its various infrastructure projects following the approval of tariff adjustments affecting the various government-regulated endeavors.
Company officials said that with the approval, the banks have opened up and offered additional facilities to finance the projects.
In its tollways business, for example, Metro Pacific Tollways Corp. chief finance officer Christopher Lizo said MPIC is only one-cycle delayed in its tariff adjustment schedule, from three-cycles earlier.
According to Lizo, MPIC had seven tollway rate adjustment petitions approved this year and implemented some of them.
“But from an implementation timing perspective (and) because we’re still catching up with what we lost the past six years, it’s also impractical to implement all at the same time,” he said.
Light Rail Management Corp. which operates LRT Lines 1 and 2 is only one-cycle late in tariff adjustment, according to Juan Alfonso, company CEO.
Alfonso said LRMC secured the tariff adjustment in August this year following the submission of four rate hike petitions the past eight years.
“The tariffs have fallen behind them. We have another tariff increase that is actually scheduled based on our concession agreement for 2024. And the completion of the Cavite extension also allows us to increase (the rate) in 2024,” Alfonso said.
He explained tariff judgments allow the operator to continue to make improvements, to invest in operation and maintenance to keep the system safe. Unlike other concessions, MPIC does not have automatic rate adjustment to account for inflation or foreign currency rate fluctuations.
“These increases are very important for us in railways,” Lizo said.
Ramoncito Fernandez, Maynilad Water Services Inc. president, said the water concession was also granted a tariff increase in January this year after having had none since 2012. Maynilad operates the West Zone concession.
“We have done a rate rebasing and regulators approved our business and capex plans and corresponding tariff. Phased tariffs were also approved,” Fernandez said.
The initial adjustment was granted last January with the next one on January next year, reflecting roughly a 16 percent tariff increase to finance the high-capital spending needed to boost service delivery.
“As we speak, climate change has really been driving a lot of changes in our service capability. Our raw water has been really very variable and also our NRW (non-revenue water) plans have already been hit by the pandemic because we were not repairing anything during the pandemic because the lockdown really prevented us from coming in,” he said.
“Even our sewerage projects were stopped, because of the concession review. No one was lending to us during the concession review. So, this catch up is must have if Metro Manila were to continue experiencing service improvements,” he said.
June Cheryl Cabal-Revilla, MPIC chief finance officer, said the tariff adjustment helps in operationalizing the public service the private sector is doing on behalf of government as a regulated business operator.
