ILOILO City may be trading decades of financial security for the promise of a quick water fix.
The local government is pressing ahead with a bulk water agreement with Aboitiz InfraCapital (AIC) that critics say will saddle the city -- and its residents -- with massive costs, while allowing the private company to collect full profits.
Instead of sourcing directly from the government-funded Jalaur River Multi-Purpose Project (JRMP II) -- now nearly complete and paid for with taxpayers’ money -- AIC would serve as a middleman, selling water to the city.
Under the deal, the current utility, Metro Iloilo Water District (MIWD), would be sidelined, leaving the city responsible for permits, marketing, and payments.
The contract includes a “take-or-pay” clause, obliging Iloilo City to pay up to P27 billion over 33 years regardless of actual water use. Early termination or project failure could add billions more in penalties.
Based on AIC’s proposal, the bulk water price could reach P40 per cubic meter.
Once distribution costs are factored in, retail rates could soar to P80–P86 per cubic meter -- the highest in the Philippines.
Monthly household bills could jump from around P200 to as much as P800, a heavy blow to consumers.
By contrast, MIWD could source water directly from JRMP II at a fraction of the cost, sparing residents from such a steep financial burden.
The legality of the arrangement is also under scrutiny. AIC’s earlier bid to tap Jalaur water was blocked by the National Irrigation Administration after the Asian Development Bank deemed it unnecessary.
The Public-Private Partnership Code prohibits unsolicited proposals where a government project already exists, yet Iloilo City granted AIC “Original Proponent Status,” clearing the way for the deal.
Concerns also stem from Aboitiz’s track record elsewhere. Its Apo Agua project in Davao City is six years behind schedule, took a decade to develop, and saw costs more than double -- overruns that could be passed on to consumers.
If the deal proceeds, AIC will control Iloilo’s bulk water supply and profits, while the city and its residents bear the full financial risk.
Critics warn the agreement could lock Iloilo into decades of costly obligations for a resource it will not fully control.
The question remains: Is Iloilo accepting false promises today, only to pay dearly tomorrow? (PR)