Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-11-17
Exit-the Consent Decree.

The District Supreme Court has up
held the contention of Peoples Counsel
Richmond B. Keech that the so-called
consent decree can in effect be strapped
by the Public Utilities Commission in
the pursuance of its duty to fix proper
rates for electricity. Neither court
decree nor an agreement can deprive
the commission of that power Ito FIX
proper rates. or absolve it from that
duty" said Justice Wheat who rendered
the opinion. an
And it is well that this question has
been disposed of. 1t would have been
rather preposterous to assume that a
consent decree entered into as COM
promise six years ago would forever bind
the decisions of the regulatory body set
up by Congress for the purpose of es-
tablishing equitable rates for electricity.
The business Of establishing fair rates
Is, rs the court points out "a continuing
problem, to be solved from time to time
aS 1t arises. So is the power of the
commission to solve 1t a continuing
power, to be exercised from time to
time according to the need"
The decision can therefore be re-
garded as a victory for the commits
sion. But the tangible results of such
q victory, and the benefits accruing to
the consumers of electricity, remain to
be demonstrated. The circumstances
under which the consent decree came
into existence must be recalled to I'M
derstand the doubtful nature of the
commissions victory. When the COM
mission decided to cut rates for cleo
tricity from ten to seven and one half
cents in 1917 the company fought the
order in the courts, and the difference
between rates charged by the company
and the rates ordered by the commits
sion was impounded annually for seven
years until the fund so held reached
about six million dollars. The consent
decree, entered in 1925, marked a COM
promise between the utilities commits
sion and the power company. under
which the impounded fund was divided
between consumers and power company
and q sliding scale for rates established,
the rates for each year being fixed &C.
cording 20 the profits made and the
business done by the company in the
preceding year. Under this arrangement
the average price for electricity paid by
the consumer decreased from ten cents
TO its present price Of "a cents. In the
meantime the profits Of the company
increased.
The Public Utilities Commission, de-
Gliding that the company's profits have
been excessive" has substituted for the
consent decree Q new sliding scale ar
rangement of rates which will become
effective on the frst of the year, pro-
vided these new rates are upheld by the
courts. That proviso Is the ny in the
ointment now. For the consent decree
not only reduced rates for electricity,
but avoided the endless litigation that
in washington has become the inevita-
BILE accompaniment Of orders promul-
gated by the Public Utilities Comnis-
sion. Now that the consent decree has
been done away with. each succeeding
order by the commission relating to
rates for electricity may be subject to
attack in the courts. And in the present
case the commission must center its
attack in the claim that the company
is making too much money, rather than
in an attempt to show that the rates
charged are excessive and unreasonable.
The real test of the commissions ef-
fort to bring about still greater reduc-
tions in the price of electricity will
come when the new rates ordered by the
commission are passed upon by the
courts.