Evening star., 1920-11-23
DENIES REHEAR|NG
ON GAS RATE RAISE
,3.1Es I. sass,sss g.
Utilities Commission Rejects
the Application Made for
Citizens. Federation.

The. Public Utilities .Commission to-
day rejected the application OF william
Nick. Clayton. on behalf Of the Fed
Grafton Of Citizens Associations. for a
new bearing ON the recent decision
Increasing the gas rate. from 81 25 to
S1.@2 per thousand cubic feet. t
In rejecting the petition. however,
the commission gives Mr.. Clayton a
clear explanation of its position on
the questions which he desired TO ar
que at the new hearing.
Government Rate Explained.
In answering one of Mr.. Ciayton's
questions the commission expresses
the belief that it should have au-
thority to flx the rates which the
federal and District governments
shall pay for gas. The commission
adds the hope that Congress will soon
enact the necessary legislation to
regulate these rates.
At the present time the federal de-
partments. pay 70 cents per thousan nd
cubic feet and the District pays less
than 40 cents per thousand for street
lighting gas.
Mr.. Clayton asked the commission
in his letter il the recent gas deci-
sion was intended to fix a definite
rate of return which the companie
should earn on the value Of tho
property.
Cammission Replies to Queries.
Replying to this question. the COM
mission states:
THE commission does not and
never has claimed the power to ix a
rate OF return upon physical property
as sucn. The commission merely
claims the power under the law to e.
tabiish rates for service furnished
which shall be reasonable as between
the utilities furnishing the service and
the public to whom the service is fur
nished. The very object Of ascertain
ing the fair value of the utilities
property. as the commission is re-
quired to do under the law, is to
enapie the commission to fix a rate
which will give to the utility a rea-
senable return upon that fair value
what constitutes reasonable rate
OF return may vary greatly at diff
ferent times and as hatween difrer-
ent utilities.
Mr.. Clayton's second question was to
lind out IL the commission sought TO
guarantee a fair return to the gas
companies by increasing the rate. The
commission answers as follows:
The commission does not guarantee
or attempe 10 guarantee any rate of
return. Its sole duty is to establish
rates which shall be fair to both the
utility and the public"
Natter Of Compensatio..
Mr.. Clayton's third question asked
whether the commission intended
when It decided on $1.32 per thou.and
cubic feet, to compensate the Cas
companies for failing to earn 6 per cent
upon their valuations during the mast
five months. To this question the com
mission states:
'Tn issuing its order of Nav %
1920 (order No. 378). fixing the rate
Of $l.25 per 1000 cubic feet of three
for a limited pepripod of three
months. the commission rejected the
plea of the company for the adon-
ton of sliding scale for gas for
the year beginning June /, 1920, the
price to vary during the year with
the varying cost Of gas oil. The COM
mission believed that it would be
more equitable and just both to the
public and to the company II the rates
were adjusted from time to time dur
ing the year upon presentation by
the company Of known costs of oil
and other materials entering into the
manufacture of gas. For that rea-
son the hearings held in August, 1920.
and October, 1920, resulting in the
issuance of orders Nos. s87 and 393,
are considered as combinations Of
the hearing in May, 1920, and the
changes in rate made since the order
Of May 29. 1920, are designed to meet
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