The Richmond palladium and sun-telegram., 1913-08-30

edge as to what action the commits
sion will take in the matter.
1t is pointed out that the electrical
plant of the l.. II. and p. company has
been operated at a loss ana that the
loss in Richmond has been made TIP
by the profit on artificial gas. Now
that the gas rates have been reduced
it is argued that the company cannot
AFFORD TO continue to supply electricity
below cost.
City Attorney Bonds Opinion.
IF the public utilities commission
will permit a private corporation TO
undersell a plant owned by the people,
with the expectation OF making up a
resultant deficit, through raising its
rates in other places or a subsequent
increase in rates when its action has
forced the public plant out OF business,
it has most certainly failed in its mis-
sion," said City Attorney w. a. Bond
this morning, when discussing the re-
ported intention of the Light. Heat
and Power company 10 meet the rate
decreases of the city light plant sched-
uled to go into effect Jan. l.
The purpose of the commission is
TO see that the people get honest, ef-
ficient service with the lowest cost
compatible with a fair return on a
bona fide investment. IL would most
certainly go beyond the spirit of its
creation. should it permit a private
corporation TO undersell a municipal
-.
ing a resultant loss by later obtaining
field free from competition with an
opportunity to again place its business
on a profit making basis"
From the statement of the Light,
Heat and Power company on file with
the public utilities commission, n. II.
Johnson, superintendent of the City
Light plant, declared that the private
corporation cannot meet the cut in
rates proposed by the city public plant
without sustaining loss.
Statement BY Wharton.
"The statement that we cannot fur.
ther decrease our rates and still show
a profit is not based upon the facts"
said J. B. Wharton, manager of the
Light. Heat and Power company. The
company showed nice profit last year
and will probably be able to do 80
again this year.
"A decrease in our present rates has
not yet been decided upon, so OF
course / cannot state just what de
creases, il any there will be. IL is not
yet known what rates will be offered
by the other company. Further action
of the Light, Heat and Power corS
pany will be determined by the an
nouncement of the future rates of the
city plant"
"Of course IL the other compan,
does decrease its prices for electric
current We will be compelled to do
/ the same
THE statement that We are seiIina
below our average cost Of production
of OPT cents per kilowat does not By
any means show that We must there
fore necessarily be losing money or
such contracts. This average cost OF
manufacture and distribution Of cur
rent is distributed among contracts
which actually lose US money because
We can not charge their actual cost
and other contracts that pay a very
good profit"
For instance. If we spend consid-
cradle money in installing conneo
tons, keeping accounts and making
collections for a customer who uses
only small amount Of current, IL can
be very readily seen that the over
head cost Of such supply is proper.
tionateIy several hundred times high
er than il would be in the account OF
a larger user o. current, purchased at
a lower rate The average cost OF pro-
duction cannot be used in this connec-
uon.
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