Evening star., 1938-09-08

often for telling only part of the
truth, but Government officials are
even more lax in their handling of
public information Thus the Presi-
dent had available in early August,
1937-more than year ago-a COM
prehensive survey on the electric pow
er situation made by the Federal Re-
serve Board in connection with the
progress of encouragement of electric
power expansion then being urged
upon him by Gov. Mariner Eccles.
The document was confidential-as
are most documents which reveal the
faults of the administration policy.
In that survey made by Government
economists the statement was made
that, SO rapid had been the expan-
sion OF the demand for electric pow
er during the recovery, the 1886 out
put exceeded 1929 by about Is per
cent. Not only had the number of
customers gone 10 per cent above 1929
but the utilization of generating
capacity exceeded the 1929 rate, too
Drop Off Began in 1888.
The confidential report showed that
while the electric power industry kept
up with replacements and expansions
fairly well the drop off in construc-
ton started in 1888. After stating
that "interconnection" systems would
take care of shortage to some extent,
the very generous reserves of capac-
tty which we're maintained under the
pre-depreSsion practices are really
the main reliance now. The report
adds:
While competent authorities con-
slider that these reserves were justi-
f1ed for the most part. as a prudent
safeguard against growth and con-
tingencies. they provide now august,
1880 wide margin within which
output can be expanded before seri-
GUS or widespread shortages are en-
countered. We are now encroaching
on this margain of safety and the
question arises as to how far the
process can 80 before we run into
trouble. -"
"As long as shortages of generating
capacity are limited to occasional sys-
TENS or areas, as they probably will
be next fall Q93O actual power short
ages may be averted by the purchase
OF current from interconnected sys-
tens having unused capacity, but this
device fails when inadequate capacity
becomes general, or when the available
mterconnections are fully utilized.
New Spending to Be Needed.
Granted that an exact estimate of
maximum output obtainable from the
present facilities without actual power
shortages is impossible, and granted,
therefore, that it is impossible to say
precisely when their capacity will be
overtaxed by the growing demand for
power, there will be little dissent from
the proposition that if output contin-
lies to expand at anything like the re-
cent rate an early revival of large
scale expenditures for new facilities
will be imperative.
ut takes ordinarily about two years
to plan, build and equip modern steam
generating plant, and three years or
more to develop new hydroelectric sta
tions. Apart from some large Federal
hydroelectric projects there are at
present comparatively few important
new central stations under construc-
ton, and if the expansion of gener-
ating capacity had to await the plan
ming and completion of such stations
an acute power shortage would inevi-
tably ensue (barring the intervention
Of business depression in the mean
time) before they could be brought
into production
But why has construction been de-
layed? Are the utilities to blame, or
Is the administration policy of creating
conditions which make it difficult if
not impossible to borrow common stock
money for financing construction?
Here Is what the same confidential
report had to say at the time:
Because of the lack of confidence
on the part of utility managements,
the industry has been living on day.
by-day, hand-to- mouth basis. Capital
outlays have been put off until the
last possible moment, if not indeed
until too late. Witness the fact that
less than half the new capacity will
be brought in for 1897 than the ex-
pansion OF output during the year calls
for. Capital expenditures for the year
promise to be only about $3.50, 900 900,