FTS changes the rates of return for the entities which adopted RAB

The rate of return for the entities, which adopted the return on invested capital method before 1 January 2010, has been reduced to 11% for 2013. The rate of return on invested capital for the entities, which adopted RAB as from 1 January 2010, has been also set at 11% for the period from 2013 through 2014. The rate of return for the entities adopting RAB as from 1 January 2011 has been set at 11% for the period from 2013 to 2015.
Such figures are represented in the draft order of the Federal Tariffs Service "On amending order #152-e/15 of the Federal Tariff Service dated 15.08.2008 ‘On adoption of the rate of return on invested capital’" published on the official website of the FTS of Russia
Earlier, FTS' order established a uniform rate of return on invested capital equal to 12%. Experts explain reduction in the rate of return due to a decrease in the value of capital raising and, as a result, a decrease in interest rates. Besides, it is reported that the reduction in the rate of return was announced after generation of long-term investment programs and their submission for approval; the company was guided by the rate of 12% when making calculations under these investment programs.
IDGC of North-West's branch "Novgorodenergo" adopted RAB regulation as from 1 January 2010.  The branch's investment program was approved for the period 2010-2012 in the amount of RUR 2,749 million.