Pricing for Groundwater Use of Industries in Metro Manila, Philippines

By Maria Corazon M. Ebarvia
Summary: The rapid growth and urbanisation of the Philippines’ National Capital Region (NCR) has resulted in increasing demand for water. Migration has compounded the problem. Today, NCR is faced with growing needs which have outpaced the capacity of the water agency ¡ Metropolitan Waterworks and Sewerage Systems (MWSS) ¡ to expand supply. Unserved sectors have resorted to ground well construction and illegal connections to MWSS pipes. As a result, average annual groundwater withdrawals have consistently exceeded the recharge rate, lowering the water table by about 6-12 m/yr. Groundwater resources are also threatened by saltwater intrusion, contamination from pollutants, and eventual depletion. Thus, current extraction and utilization of a unit of these resources involves an opportunity cost ¡ the value that can be gained in the future. This study was conducted to estimate the marginal opportunity cost (MOC) involved in meeting the water requirements of the industrial sector, and determine the right mix of pricing, fiscal and regulatory instruments for efficient use of groundwater. The main water source for industries in Metro Manila is groundwater (80%). Only about 20% get MWSS-supplied water, and some must augment water requirements by buying water from private vendors/tankers.

Research Report: Download
Country: Philippines
Publication Year: 1997
Research Areas: Water Resources
Research Topic: Water Pricing
Analytical Framework: Resource Pricing