Imperial Valley press. (El Centro, Calif.) 1907-current, 1937-06-01
HOW PEOPLE WOULD PAY
UNDER NEV-C4L PROPOSAL

UNDER NEV-CAL PROPOSAL
III is necessary for voters of the I'M
perlal irrigation District to examine on
ly one Item to see what economic folly
II would be to consider the Nevada-C Cali
fornla Electric corporations offer to
buy All American canal power.
That item reveals that, regardless of
technlcal phrases, the power company
would not be buying our power. We
would be buying it from ourselyes-and
paying the power company a handsome
royalty which otherwise would accrue to
us.
The power company, according to A.
b; West, proposes to pay an estimated
S35,OOO,0OO during 40 years for electric
energy from the All American canal.
Some of the power, the company de-
clares, would be sold in other states, in
markets made available by the compa-
ny's widespread lines.
The fact is, none of the power need
be sold IN other states, or anywhere out
side Imperial Valley, so far as the power
company is concerned. 1t would get its
money back anyway. The company's
proposal, in its own words, includes a
stipulation that:
g. future rates in Imperial Valley
shall be based upon the cost of energy
purchased from All American canal
plants, with no consideration for cost
of power from other sources except for
standby purposes or to the extent that
energy is required to supplement that
so purchased :"
The item means, in effect. that the
power company could pay us S35,000,000
for our power, sell us any portion of
it we as consumers might need, leave
the rest lie dormant, and charge us a
rate sufficient to pay for the entire
$35,000,000. Or, if the power company
did sell a part of the power elsewhere,
any profits from it would not have to
be taken off the rate in the valley We
would still have to pay a rate "based
upon the cost of energy purchased from
All American canal plants" The COM
pany could pocket the difference.
Suppose you were a farmer, engaged
in the business of growing lettuce.
Would you harvest the lettuce, clean it.
crate it and sell it to the owner of
grocery store for $3.50 then turn
around to another clerk in the same store
and buy back your crate of lettuce for
Sc? If you did, you would be paying
the grocer for his rent hire of clerks,
cost of fixtures and every manner of
overhead, besides his legitimate profit.
This is exactly what would happen if
Tic ptOplt SOlu CllSlI SLCSliiS pONSl ~
the Nevada California Electric corpor-
alton.
1t makes no difference what they offer
US 1t might as we'll be S100,000,000. If
it were, we would have to pay back $780,
100000 through our electric bills. Their
rate would still be based on the "cost
of energy"
The power company's rate, however,
would include not only the cost of ener-
gy. 1t would include also the companys
handling charges, PLUS seven per cent
return on investment. The investment
would not be diminished.
Distributing their own power, the peo-
pie would not be under obligation to pay
themselves a seven per cent return on
their investment Neither would their
organization be forced to seek strictly
legitimate but costly Ito the consumer)
methods of Transforming liabilities into
assets, or vice versa, for bookkeeping
purposes. Economy of operation would
come down to the people from their
own plant in reduced rates. 1t would not
be transformed in the bookkeeper's Of
flee into profit which is not shown as
profit on the books. Reduced rates would
be the peoples profit.
There is no way to escape the conclu-
sion that all the Nev-Cal company Of
fers us is chance to turn over to them
whatever profit we might otherwise de-
rive from All American canal power.