VECO filed with the ERC, its appeal for realignment and adjustment of distribution rates, in April 15, 2008.
Lacson stated that in VECO’s 2009 application, the asset rate base of the company has augmented to PHP6.41 billion, which is why he feels that VECO is eligible for the 41% increase in distribution rate.
He said “VECO deserves the increase. The company spends an average of PHP500,000 year-on-year to maintain the business but the operating cost goes up with time.”
Lacson affirmed that in 2008 the firm’s return on rate base (RORB) witnessed only 2.3% instead of the 12% that it could have obtained under the law.
Out of the 35 centavos per kWh that VECO is appealing as rate variation, only 18 centavos will be allotted for the RORB. The remaining 17 centavos will be used for the hikes in maintenance and operations cost brought about by the hike in prices from 2000, among others.
