Evening star., 1933-02-07
DETAILS PREPARED
FOR ELECTRIC RATE
REDUCTION FEB. IS
Utilities Board and Pepco to
Hold Hearing on VoIun-
tary Cut.

officials of the Public Utilities Com
mission and the Potomac Electric Power
Co. today were preparing details for
consideration at public hearing Feb
ruary 16, when the rates of the power
company are to be reduced voluntarily
in keeping with an agreement reached
yesterday by which litigation over the
issue is to be abandoned.
- The only matter now scheduled for
the forthcoming hearing is the question
of how the 1862 900 saving for electric
to be apportioned among the various
classes of power users, commission off,
cialS said
Meanwhile, officials of the commits
sion and the company are prepared to
notify the District Court of Appeals OF
the new agreement, which would mean
the relinquishing by the power concern
of its appeal from the decision by JUS
tice Oscar Luhring, which upheld the
right of the commission to set aside a
former consent decree by which rates
were governed and to establish new
schedules of its own.
Will Offer New Schedule.
The power company, some time prior
to the February 20 hearing, is expected
to submit a proposed new schedule of
rates for the various classes of its con-
sumers, these to be subject to the con-
sideration by the commission before the
new schedules are ordered into effect
Just how the saving of more than a
half million dollars in power service
charges will be apportioned among the
different classes of consumers could not
be indicated today, but expectations are
that each class will receive a cut in
charges.
This was the case last year when the
rate reductions amounting to an esti-
mated total of $500, 900 were placed into
effect under a compromise plan. The
lesser amount of the reduction in pros
pect this year is regarded by officials
OF the commission as a commentary on
the lesser earnings during the past year
by the company.
The formula used last year in appor-
t1on1ng the reductions. it was made
clear at the commission this morning,
may not be taken necessarily as guide
to the division of the rate reductions
for 1888, since new conditions may
WELD influence.
Savings by Schedules.
The general residential consumer last
year. as affected by schedule A in the
rate system, benefited to the extent
Of about 7.85 per cent of the total re-
duction, or about $271 900; schedule B,
affecting operation of batteries and mo-
tors for welding purposes, saw a re-
duction of about lis per cent or ap-
proximately saving of s53,000 sched-
ule G, affecting such service as
apartment house motors, elevators and
apartment house lighting, a reduction
OF about 6.5 per cent or about $31 900,
and schedule D, concerning general
lighting and power, including business
house usage, a reduction of about IL
per cent for that class, or about S407,-
600, commission experts explained.
Lesser savings, in dollar volume were
effected for high and low tension power
service classes.
In the agreement reached yesterday,
the power company gave up its appeal
and admitted the power of the COM
mission to deal with rates, whether or
not court decree, establishing
method of rate making, existed
Had the new rates been fixed under
the old consent decree method, it was
explained at the District Building the
possible reduction in power charges
would have been $4,000, instead of
$685. 900. Under the method approved
by Justice Lurhing in a decision last
July, the reduction would have been
$647, 900.
The agreement reached yesterday by
the commission and the power company
thus is regarded as compromise.
Allowed 7 Per Cent.
The sliding scale set up by agree
ment yesterday allows the company to
earn per cent on an agreed valuation.
Where the return in any one year Is
more than z per cent and not more
than 8A per cent, SO per cent of the
excess shall be used for rate reduc-
tions in the following year; where the
return earned Is between 814 and 8
per cent, 60 per cent of the excess over
8H per cent shall be used for the re-
duction of rates; and, finally, if the
amount earned is in excess Of 9 per
cent, a further additional anaount of
70 per cent OF the excess above per
cent shall be used for reduction in
rates.
The decree also provides that II the
rate for any two consecutive years falls
below ga per cent, or If it falls below
612 per cent for any one l2-month
period, the company shall be entitled
to prompt increase In rates, so as
to assure it return of Z per cent.
Present at the conference at which
the agreement was finally reached were
members of the commission, Corpora
ton Counsel w. w. Bride, Peoples
Counsel Richmond B. Keech, Assistant
Corporation Counsel william A. Roberts
and President William. F. Ham, Vice