The news scimitar. (Memphis, Tenn.) 1907-1926, 1920-09-14

eAiSsoC lhtiBo VIII U6 Dy
the, Memphis Gas and Electric Light
company in a letter. to Mayor Paine
tuesday afternoon containing tentative
schedules of rates needed to raise the
annual deficit of approximately 1926, 900.
The letter and rate schedules win be
given to the mayor either in person or
presented at the open meeting of the
city commission Tuesday.
Plans for large construction program,
as outlined in the report of F. G.
Proutt, consulting engineer, will not be
attempted by the gas company until
the appraisal of the property of the
company is completed and rate of re
turn established by the state utilities
commission.
The percentage of increase can not be
determined for either gas or electricity
Until the city commission accepts one oil
the tentative schedules All of the
schedules, however. contemplate an ad-
dttional total return TO the company OF
the .$S26,Oo0 mentioned by Mr.. Proutt
In his report to the mayor.
If the emergency rates are accepted
by the city and granted to the com
pany, the receivers will Immediately be-
gin the expenditure of money to take
care of the additions to the plants tc
care for present needs" Lovick =
Miles, attorney for the receivers, said
Acceptance of new business from resi-
NNHSN pOpCily VIII Dt IcSuIIlcu Dy lIt
electric department on Oct. Is, in the
event the emergency rates are granted
There is nothing in our letter ia
Mayor Paine at this time relative to
resumption of gas extension service
Utilities commissions in other states
Rave held and ordered gas companies to
discontinue service TO large consumers
in order that they might take care OF
the domestic needs of their patrons
The Memphis Gas and Electric COM
pany is producing gas TO the limit OF
its capacity now, and 1t may be nec-
essary to secure some similar order
from the Tennessee commission before
we can take on new gas business"
Losing Coin in Gas.
Speaking OF the contemplated rate In
ereases, Mr.. Miles said that 1t was cost.
ing the company $1.60 per 1000 cubic
feet to deliver gas ready for use, while
their present rates net them S1.29. The
company figures 1t is losing 81 cents OF
each thousand feet supplied.
People use gas because 1t is more
economical and convenient than other
fueas Increased rates may force some
people to use other fuel and thereby
relieve the burden we now have and
permit the assumption OF new business
Many large consumers use gas and II
may be necessary to secure an order
from the state commission ordering the
receivers to discontinue this service
and take care of the domestic needs.
In this event. of course, service might
be resumed earlier than otherwise.
THE elaborate building program
which would necessitate the expendi-
ture Of approximately $500. 900, as out
lined in Mr.. Proutt's report cannot be
undertaken until the appraisal is COM
pleted and a permanent rate established
by the commission, guaranteeing rea-
, sonable rate of return on the invest
ment over and above operating cost
For present needs, however, the re-
cevers will issue notes having priority
over everything else after actual cost
of production has been taken care of,
and will use the money derived from
these notes for making necessary ad-
ditions to the plants and putting them
in such shape as to enable them to take
care of present demands
Mr. Miles spent the greater part OF
Tuesday morning in conference with
Frank S. Elgin and ]. f. Rainier re-
ceivers of the company and experts OF
the gas company. The request of the
gas company is contained in a very
lengthy letter addressed to Mayor Paine
and outlines in detail the aims Of the
gas and electric company.
"The condition of the Memphis Gas
and Electric company" Mr.. Miles said,
lis not a local condition, but is prevail
ent more or less throughout the nation.
Nearly every gas manufacturing com :
pany has more business than 1t can
handle and many state commissions
have found it necessary to eliminate
large consumers in order to care tol
the needs of the many small consum-