Evening star., 1932-01-20
Compromise Proposal Makes
Possible New Primary
Charge of 3.6 Cents.
HEARING TO DETERMINE
DISTRIBUTION OF CUTS
Utilities Board Agrees to Plan.
Reduction Represents 20 Per
Cent of Excess Profits.

The Potomac Electric Power Co. and
the Public Utilities Commission today
reached an agreement that $780, 900
Will be used as basis for rate redue.
ton In 1882, effective February =
This amount, $4,000 more than ttnss
used in 1881, will make possible the
new primary rate Of about 3.6 cents
per kilowatt-hour in comparison with
the present rate of AZ cents.
The cut represents about 10 per cent
OF the company's excess profits during
1890. 1t is greater than would be pos
sible under the consent decree scrapped
by the commission last year. However,
it Is less than the cut possible under
the new sliding scale established by the
commission, which is now in litigation
in District Supreme Court.
Public hearings will be held by the
commission beginning Monday, largely
to determine how the reductions shall
be distributed between the various
schedules.
Court Battle to Continue.
The court battle over the commits
sions new sliding scale will continue.
The compromise is effective only until
the appeal from the commissions slid
Ing scale order Is finally settled by the
courts.
The company's statement of net
earnings for 1881 showed a profit of
S5,260,000. Under the old consent
decree, about 100000 of this would
have been used for rate reductions, and
under the commissions sliding scale
the amount would have been approx
mately S1,O00,000.
The compromise was arranged large
ly through the efforts OF DR.. Cloyd
Heck Marvin, president of George
Washington University, and mem
Der of the board of directors of the
| power company.
The Public Utilities Commission is
| sued the following statement today in
explanation Of the compromise:
| THE Potomac Electric Power Co. ap-
pealed to the court to enjoin the en-
| forcement of the Public Utilities Com
| missions order No. 919, which modif1es
the sliding scale arrangement under
which electric rates have been fixed
since 1925.
Discussion Still Awaited.
THE court has not yet rendered its
decision, and the commission felt that
in advance of the court action it would
not be justified in putting this order
into effect for the purpose of adjusting
the new rates, which will 60 into effect
February /.
cat the same time, the commission
was not willing to fix such rates in ac-
cordance with the unmodifed sliding
scale as embodied in the consent decree.
While the commission was endeav-
oring to determine what action 1t should
take, the power company voluntarily
came to 1t with q proposal to effect
reduction in rates, beginning the first
of February, which would in IL months
decrease the company's gross income,
based on the business done in 1881, by
the sum of S860,000
The company stated that it was
heartily desirouS Of granting this meas
ure of relief to it's customers, and that
If this offer was accepted by the COM
mission, the company would not appeal
from the order of the commission, put
ting the new rates into effect.
This sum, $3.50 900. is $4,000 more
than the reduction made at the end of
1880. 1t is also more than 100000
have been made under the consent de-
cree.
Offers Accepted.
"In view of the business uncertainty
now existing, the considerable differ
ence made by the destruction of SO
many buildings in the triangle ares,
the probability of heavier taxes will bS
imposed on the company during this
year and the positive benefit which will
promptly follow an undisputed order
fixing the new rates, the commission
has thought it best to accept this offer
of the power company.
THE public hearing scheduled for
January Is will be held, but its main
purpose will be to determine how this
sum of $860,000 will be distributed
among the various rate schedules"
Peoples Counsel Richmond B. Keech
was present at the meeting at which
the compromise was arranged and said
today he was perfectly satisfied with
it. The commission was represented
during the conference by Corporation
Counsel William w. Bride and Assist
ant Corporation Counsel William A.
Roberts, who also agreed that the COM
promise was a good one.