Evening star. [volume] (Washington, D.C.) 1854-1972, 1924-12-28
The Light Rate Settlement

Ten years ago the District Com
missioners, acting as the Public
Utilities Commission, began the valu-
alton of the properties of the Poto-
mac Electric Power Company to de-
termine a fair rate for electric cur
rent with reference to the cost of
production and to the capital invest
ment. After two years the work of
valuation was completed, and was
stated at slightly more than 81 ,000,-
600, as Of December 81, 1916. On the
basis of this valuation the Commits
from 10 cents per kilowatt hour to s
cents. The company appealed to
court to set aside the rate and the
valuation on the ground that both
were too low. The case has been
pending since without final decision.
Meanwhile, consumers of electric cur
rent have been paying the old 10-cent
rate, with a provision that cents
should be impounded and held as a
fund in trust to be reimbursed to
consumers should the Scent rate be
approved or to be turned over to the
company should the 10-cent rate be
established.
By direct negotiations now COM
promise settlement has been effected
between the Public Utilities Commits
sion and the corporation whereby the
rate is reduced to IA cents, and the
s6,000,0 600 fund Of impounded excess
payments shall, after the deduction of
about $500,000 for taxes, be divided
equally between the company and the
consumers. In other words, the con-
sumers will get little less than l
cent per kilowatt hour back in cash,
while the rate for the future will be
reduced by 25 per cent from the 10
cent charge.
This arrangement means that the
rate for the past eight years is now
established retroactively at cents
instead Of 10, as the company claimed,
and s, as the commission ordered.
Had the court ruled finally in support
Of the commissions valuation and
rate refund Of full cents, perhaps
less taxes, would have followed, leav-
ing the rate at cents. The COM
promise upon the 7h-cent rate is
therefore an advantage to the con-
sumner beyond that which would have
been gained by a full approval Of the
commissions valuation and rate by
the court.
money will be long and difficult.
Many Of the consumers who have
contributed to the fund have died and
their estates must now receive the
refund. Others have moved away
from the city and ceased to become
users of current here, and they must
be found and their shares given to
them. Those who are still using
current will get their refunds in cash
directly. The new rate will 60 into
effect on the LIST of February. The
refunding will begin promptly, but
may require months for completion.
This agreement settles a dispute
that has been a troublesome factor in
the relations between the District and
the public utilities corporations for
nearly a decade. It has affected the
status not only of the Potomac
Electric Power Company but OF the
Washington Railway and Electric
Company, an affiliated corporation
The impounded money could not be
regarded as an asset. 1t was, in fact
a liability. Now it's ownership has
been determined, the resources Of the
corporation defined and a cause OF
irritation between the corporation and
| the community removed. The Dis
| trict officials who have fought the
| District battle during all these years
and who have conducted the negotia
tions for this settlement have rem
dered a valuable service, and the cor
poration itself is to be congratulated
upon the spirit of adjustment that
has led to this altogether satisfactory
solution OF q vexing question.
/