The President called the special session to discuss the 2001 national budget, the power bill, the proposed amendment to the Organic Act of the Autonomous Region of Muslim Mindanao, and the proposed Solid Waste Management Act.
Sen. John Osmena, chairman of the Senate committee on energy, admitted that three sticky points, all affecting power giant Meralco, still have to be resolved.
The bicameral conference committee is slated to undertake another meeting tomorrow night, after the impeachment trial, to resolve the three issues.
One of the sticky points involve the computation of the 12 percent return on rate base (RRB).
"The Senate proposal is that income taxes and interest expenses are not allowable deductions from permissible return on rate base. The House contingent is against this proposal," Osmena said.
It was noted that Meralco has been computing the 12-percent RRB by deducting its income tax from the gross profit. The Energy Regulatory Board contested this manner of computing the RRB and there is now a court case on the issue. There were claims that with the deduction, the actual RRB has gone up to about 18 percent.
"There is no clear legal provision on the computation of RRB. To remove this ambiguity, we decided to disallow income taxes and interest expenses as deductions from the RRB," Osmena said.
The second sticky point involves the development of a competitive market and prevention of domination. The Senate measure provides that dominant generators who own or control or operate 25 percent of national installed capacity or 30 percent of a grid shall not be allowed to add capacity for a period of seven years to allow competition to develop. – Efren Danao