Evening star., 1928-05-02
MERGERS RUMORED
IN UTILITY FIELD
Efforts to Cut Costs Bring
Talk of Consultations
of Power Companies.
BY ]. c. RoYLE.
: soe,isl nlsra,ch 10 The Star.

NEW YORK. May 2-Eiectric power
consumption throughout the United
States today is 10 per cent greater than
1t was 8 year ago, and the curve OF
electric current consumption is still up
ward This is due in part To the ap-
pllcstion of current to new industrial
and household uses and in part to ex-
tended power lines, but mainly 1t is
6ue 10 rate reductions. which have stfm-
ulated demand among class az Gus
toners which heretofore have never eN-
perimented with electricity as a motive
power.
This fact is thoroughly recognized by
thc public utility concerns, which are,
therefore, making determined EFFORTS
10 reduce operating costs 50 as TO enable
them 10 follow the trend Of some fortu-
naeely situated companies that nave
been able 10 reduce rates and still MAIN
tain profits In fact, those proflts have
increased to the extent Of IL TO Is per
cent i'll net income since the first OF the
year as compared with the correspond
ing period of 1927
More Utility Mergers.
This has given renewed impetus TO
runors Of additional public utility con-
solidations ana mergers. The most
persistent Of these rumors concerns the
ton Of Philadelphia which operates
utility companies in q States, and the
Public Service Corporation OF New Jer-
Sey. President McCaTter Of the Public
Service Corporation Of New Jersey has
enphatically declared that his company
always has been and always viii be a
New Jersey company and an independ-
ent company. The United Gas d I'M
provement executives decline absolutely
70 confirm or deny the rumorS OF ab-
Sorption.
It is known however. that United
Gas & Improvement is already heavy
and growing Stockholder in Public
Service Of New Jersey, These denials
OF President McCaTter are therefore
regarded in many quarters as purely
technical. There was no merger when
United Gas & Improvement bought
control Of the Philadelphia Electric Co,
which has been maintained as Sepa-
rate organization
Mellon Controls Firm.
Il Is pointed out that & separate
organization for the Public Service Cor
poration OF New Jersey could be con-
tinued even after control had passed TO
United Gas & improvement
The latter company was organized by
PhiladelphisnS and was developed by
EI14SaCC4HL11a 0At Al 1OS AAdS
passed into control Of Andrew ". Mel
lon, Secretary Of the Treasury. and his
immediate group Of financial associates.
This group took hold Of the Phlladel-
phla company. which operated natural
gas. electric and street railway proper
lies IN Pittsburgh, when II was In bad
way and built il up 20 profitable posi-
ton. This experience LED them to favor
lns public utility field and they bought
l4g amounts Of United Gas & In
p-oYement stock. which they shortly
proceeded 10 reorganize.
Arthur w. Thompson. who had re-
tuvenated the Philadelphia Co, was
MADE president CT United Gas Il I'm
pToVement Mr. TtompSon's first step
was TO dispose OF the less profitable
plants II the great United Gas g. In
pro1euent circuit The more profitable
plants have been operating in chains
CT groups, and this unquest5onably has
strengthened the position Of the COM
psny Just as the same policy is help
.ag cut other public utility concerns
throughout the country.
Philadelphia Co. Purchase.
The most conspicuous example OF the
operation of this policy was the pur-
chase by the United Gas & Improve
nsenf Co OF the Philadelphia Co, which
carries with ii control OF The great
hydTo-elscfrlc development at Conowin-
&c. On the Susouehanna River. which
has just been placed in operation. The
Philadelphia Electric Co. also has
complete monopoly Of the supply OF
electric current IN Philadelphia and
Chester. and while il Is dominated by
United Gas e. Improvement q separate
organization is maintained
III nj these FSrfk are taken In Pn1la-
deIphia circles as pointing toward the
purchase IN the near future OF stock
control Of Public Service Of New Jer-
sey The plants Of the latter concern
lie a. the United Gas a. improvements
coor. and Philadelphia reports state
that there Is thorough understanding
existing between Thomas NJ. McCarter,
president Of Public Service. and United
Gas & improvements management.