Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-08-20
.PEPCO VALUATION
PROBLEM TAKEN Up
Fourteenth and B Property
Considered at Conference
With Utilities Body.

While the Public Utilities Commission
and representatives af the Potomac
Electric Power Co. were threshing out
the sum to be taken out Of the COM
panys value for retirement Of their
property at Fourteenth and B streets
yesterday, the commission also asked
the company to consider several other
matters relating to valuation. Since
the company representatives had no no.
tice OF the subjects to be discussed, they
were not pressed for final answers and
further conferences will probably be
held after the company has had time
to study the commissions questions.
The property in question has been
bought by the Federal Government, and
the question under discussion n whether
1t Is to be taken out Of the valuation at
Its book cost" or at the book cost plus
the increment allowed by the District
supreme Court when the compromise
was effected In 1924 setting the com-
panys valuation at $32,S00, 900.
Difference Of s6oO,0OO.
There is a difference of $500, 900 In
the figures, which would play an imnor-
tant part on future rate fixing If the
smaller amount contended for by the
company. Is deducted. According to the
consent decree the company is allowed
to earn ia per cent on its consent valid
alton. Any excess over this is supposed
to be split. one half going to the COM
pany in cash and one half to the con-
sulners in the way of lower rates the
following year.
Although the consumers have received
the lower rates each year, the effect has
always been to boost the company's
earnings, Each year since the rate re-
AllPfinlC q he H.
more than in the preceding years.
The commission pointed out to the
company that when consumers who live
far from the established power lines
wish to have their houses connected fol-
electricity they must pay the entire cost
OF putting UP the extra poles and wires
This Is later returned to them as other
consumers hook on to the same ex.
tentions. But in the meanwhile the
value Of such poles and wires Is added
to valuation. Since they have beer
paid for by the consumers, and not the
customers, the commission wanted tx
know whether it would not be fairer tt
wait until the company had paid for the
extension before adding the value tc
tlluation.
Another Cost Problem.
Another problem is that of adding tt
value the cost of items of property be-
fore they are actually in service. Il
was stated that there was no case or
record at this time where the power
company had done that, but apparentl,
the discussion was based on the DOS.
sihility that this course might be fol.
lowed with respect to the power com.
pany's4 new Offices being built to replact
the location from which the Fedora
| Governments building plans are fore.
ing the company.
| Lastly there was the question OF
whether the company would be willinI
to deduct accrued depreciation from ii
valuation figures. In the consent de-
cree no allowance Is made for this
Since the commission feels itself bount
by this decree, If the company does no
volunteer to deduct this accrued de-
probation, 1t appears that nothing viii
be done about it.
g. Russell Bowen, vice president ant
counsel of the company. and A. n. Neal
vice president and controller, repre-
scented the company at the conference