A water district’s water rate is determined by the following factors:
- cost of systems expansion
- operation and maintenance cost
- number of connectors
- debt service needs of the water district
- ten percent reserves
- operating efficiency
Water rates are implemented only after they are presented in a public hearing and after review and approval by LWUA.
To ensure that the average water user in the province can afford the water service provided by the water district, water rates are set through a socialized pricing scheme. Big water users such as industries and commercial establishments are charged higher rates which, in effect, subsidizes the smaller but more numerous water consumers. In addition, a lifeline rate ceiling is also set, equivalent to 5% of the annual income of the low income group.