Component of the microsomal membrane bound fatty acid elongation system, which produces the 26-carbon very long-chain fatty acids (VLCFA) from palmitate. Catalyzes the reduction of the 3-ketoacyl-CoA intermediate that is formed in each cycle of fatty acid elongation. VLCFAs serve as precursors for ceramide and sphingolipids. a very-long-chain (3R)-3-hydroxyacyl-CoA + NADP(+) = a very-long-chain 3-oxoacyl-CoA + H(+) + NADPH 3-oxooctadecanoyl-CoA + H(+) + NADPH = (3R)-hydroxyoctadecanoyl-CoA + NADP(+) 3-oxoeicosanoyl-CoA + H(+) + NADPH = (3R)-hydroxyeicosanoyl-CoA + NADP(+) 3-oxodocosanoyl-CoA + H(+) + NADPH = (3R)-hydroxydocosanoyl-CoA + NADP(+) 3-oxotetracosanoyl-CoA + H(+) + NADPH = (3R)-hydroxytetracosanoyl-CoA + NADP(+) 3-oxohexacosanoyl-CoA + H(+) + NADPH = (3R)-hydroxyhexacosanoyl-CoA + NADP(+) Lipid metabolism; fatty acid biosynthesis. Interacts with the fatty acid elongation system components ELO3 and TSC13. Present with 41900 molecules/cell in log phase SD medium. Belongs to the short-chain dehydrogenases/reductases (SDR) family.