The study for instance, confirms the actual size, depth, and industrial uses of Laguna Lake - “it has a surface area of about 90,000 ha, an average depth of 2.8 m, a total of 3.2 B m³ volume of water and shoreline of 220 km.  Some 21 major tributaries drain into the lake.” 

          Despite its large area coverage, it has only one outlet, the Napindan Channel.  The channel is confluent with the Marikina River and this confluence forms the Pasig River.  Perhaps, no other lake in the Philippines can measure in significance to the industries located in Luzon as the Laguna Lake can. 

          Rivera’s observations, for example, pointed out that Laguna Lake is unique in its strategic location, rightly saying that the Lake and its tributaries are located in the country’s center of urban and industrial development.  The fact is that, it straddles Metro Manila, the whole of Laguna and Rizal, and parts of Batangas, Cavite and Quezon. 

          This makes the Lake a major supplier of water for the provinces that compose the Cavite-Laguna-Batangas-Rizal-Quezon (Calabarzon) area.

          The Lake has been traditionally used for the functions of aquaculture, irrigation, transportation, recreation, cooling water for machine used in power generation, domestic cleaning and drinking, and other industrial functions. 

          Unfortunately, industrialization poses its own demerits in connection with the quality upkeep of the lake.  As was noted by Rivera, the Lake has become “a sink for the waste generated by the industries located along its periphery.”

          “The Lake as a natural resource is also threatened by the pressure of an increasing population and by increasing economic use in the near future”, Rivera contended.  She implied that stiff competition over the use of water among the Lake users, while already taking place, is also expected to increase further and take its toll on the economy.

           In the face of environmental and man-made changes that contribute to the diminishing quantity and quality of natural resources, Rivera recommended the designing of an efficient and effective management system for the country’s water resources. 

            She said that, to this effect, the use of economic instruments to evaluate the reserve and potential value of lakes is already being explored in the Philippines.

           Meanwhile, the Philippines has already put an effluent fee charge system for Laguna Lake for its use as a pollution sink.  “The same costing scheme is being considered for other areas of the country”, Rivera averred.

         One very apparent cause of conflict among the users of Laguna Lake water, Rivera observed, is the difference of salinity requirements between agriculture and fishery use of water.  These two sectors are major users of the Lake’s water.

         Generally, Rivera said, “There is also competition over limited water quantity and conflicts over the quality of lake water.  Lake water, aside from having limited quantity, also has a relatively narrow optimum or permissible range of quality for each use.  As a result, water allocation in terms of quality and quantity becomes critical factors of use in lake management.”

          While lake water is becoming scarce in the Philippines, increasing economic uses of the Laguna Lake’s water is expected to contribute to the need to put positive value on the use of water resource. 

            “That use of water from lakes can be priced puts it as an important factor for analysis in the case of Laguna Lake”, Rivera said.

            “The reason is that it is the only lake in the country that comes under the complete control and management of a lake authority, in this case, the Laguna Lake Development Authority (LLDA)”, Rivera pointed out. 

            “The LLDA is authorized to charge for water use and is therefore, in the best position to implement a pricing scheme in reference to the conditions of the Lake”, she added. 

           Thus, LLDA tapped the research expertise of ERDB with Rivera at the helm and the technical assistance of the Environment and Natural Resources Accounting Procedures (ENRAP) group in conducting an inventory of lake water users.

           The inventory, however, focused only on the water drawn from the Lake and its tributaries.

           Uses of lake water and volume extracted.  Rivera reported that a number of sectors extract water from the Lake and its major tributaries for various consumptive and non-consumptive uses.

           For purposes of the study, consumptive use is defined as consuming water without necessarily returning it back to its source.  Water is either absorbed by the soil, or forms part of the wastewater discharge.  Consumptive use includes irrigation, domestic consumption, and washing of gravel and sand.

           Farmer-irrigators as consumptive users extract a total of 32.68 MCM/year from the lake. 

           Rice and vegetable farmer-irrigators use up to 405.21 m³/year, while domestic water users extract on a yearly basis of 52.50-M m³.

           On the other hand, Ayala Land Inc. (ALI), a private company, draws from the Lake drinking water for its concessionaires and clients in their real estate business. The company extracted water from the lake  204, 445.30 m³ in 1999 and a total of 1.303 M m³ from 1994 to 1999.  

         The City of Marikina draws 0.01 MCM of water from the Marikina River to Irrigate the ornamental plants within their parks.

          In addition, companies engaged in the gravel and sand business and crushing of aggregates also use an average of 630, 000 m³/year in their business operations.

          Non-consumptive use is basically the process of plowing backwater to its source with minimal or negligible change in quantity and quality.  Shell Philippines, Inc., located near the shores of Laguna Lake is a non-consumptive user and extracts water to cool its machines. 

          On the other hand, 527. 04 M m³/year of lake water has passed through the turbines of the National Power Corporation to generate electricity. 

          The volume of water drawn from the rivers, springs, and creeks for power generation and industrial cooling was relatively lower than the volume derived from the lake.  Only 120.82 M m³ of water per year was drawn from the Lake for power generation, while 1.34 m³ was drawn for industrial machine cooling.

         Mode of payments for the use of water.  Only ALI pays for the raw water it taps from the lake.  In February 2000, it paid P2.03/m³ of water to LLDA.  All the rest of the sectors pay only for the cost of water distribution.  Irrigators, for instance, pay the National Irrigation Administration (NIA) for irrigation water as the domestic water users pay to the water districts and waterworks.

         Farmers pay to NIA in cash or in kind an equivalent of 1-1.5 cavans/ha per season if the landholding is less than 2 ha and 2- 3 cavans/season for a landholding of 2-5 ha.

          Water districts, on the other hand, charge their concessionaires P48-107 for the first 10 m³ of water used, and an additional charge for every cu m added to their consumption. 

          Waterworks charge a flat rate ranging from P5 to P30 per concession per month regardless of the volume used.

          Existing and alternative water sources.  The Lake, springs, river, ground or even rain are the common sources of irrigation water.  Water extraction from the ground costs approximately P1.80/m³.

          Costs, returns and economic rent. A number of salient points arose from the study of Rivera in considering costs, economic returns, and rent.

          No economic rent was recorded for irrigation during the rainy season.  This means that no amount was charged from the farmers during the rainy season, when water is more than sufficient.  However, during the dry season, a rent of P0.10/m³ must be collected for the use of water, according to Rivera.

         ALI sells to its client potable water at P23. 87/m³.  It pays LLDA the amount of P2.03/m³.  On the other hand, the remaining 71% may be considered as an allocation to some of the fixed costs incurred by ALI, which have been reflected in the computation of the production cost.

          As far as the waterworks are concerned, rent was computed at P0.0185/m³ at 15% margin for profit and risk (MPR).

          The rent for the use of water in the aggregates, gravel and sand business was computed at P0.56/m³.

          Tradable water user rights. A tradable user right is a market-based instrument that assigns property rights to individuals for the use of a resource. 

           This property right is embodied in a user permit.  Each permit entitles the holder to use a specified amount of resource (e.g., m³/second or share of stream flow or volume of water use).  All right holders use up a certain amount of resource specified in the title.

            The title also specifies the upper limit of the amount of the resource that can be used.  This holds true for all users.  These permits are transferable and therefore, can be bought and sold at a price agreed upon by the transacting parties.

            Recommendations.  In view of the foregoing development on the use of the Laguna Lake water, a number of recommendations were forwarded for further study. 

           One of the factors suggested for study is the impact of the respective water uses on the quality of the Lake and its tributaries’ water as this study is focused only on the quantity of water extraction.

           However, Rivera suggests that, if ever the computed prices in this study are ever heeded, LLDA must exert all effort to improve the water quality of the Lake and its tributaries. 

Finally, Rivera contends that the overall results of this study have extensive regional and national implications for future policy formulation.  ( Erlinda H. Belen, S&T Media Service)