Evening star., 1946-07-16
.CourtUpho|ds
Light RateCut
Fixed byPUC
Dismisses Appeals
By Pepco and U. S.
On S1,037, 900 Slash

The Court of Appeals today
upheld the decision of the Public
Utilities Commission ordering
the Potomac Electric Power Co.
to reduce it's light and power
rates by sl,037,OO0 for the rate
year 1914
BY tVO-to-one decision the court
upheld District Court verdict
which dismissed appeals from the
PUG order. both by Pepco and the
Government. Pepco claimed the
ordered reduction in rates was TOO
large, while the Government. Pepcos
largest customer. claimed it was
not large enough
The courts ruling was handed
down in a memoran ndum decision.
Opinions will be published later.
In uphold ng the PUG against
PepcO Justice Wilbur K. Miller dis
sented. In upholdlng PUG against
the Government Justice Henry w.
Edeerton dissented Justice Bennett
Champ Clark ruled for PUG in both
issues
Order Issued in June. l944.
The PUG issued its order in June
1914. but the order was stayed pend
ing appeal. The company filed a
rate schedule with the PUG allocat-
ing the ordered reduction but
sought judgment through appeal
TO prevent the reduction going into
effect. The tentative rates for 1914
give 80 per cent of the reduction
TO commercial customers. 20 per cent
to houSeholders The reduction is
retroactive TO March l. 1914. Thus
typical householders among the
company's 200 900 domestic Gus
toners Will receive a credit of about
$3.50 on their light bills TO date if
there is no further appeal
The Government entered the case
through TWO agencies. Treasury's
Procurement Division and the Fed
eral Works Agency, contendine that
the reduced rates should amount 70
at least So 100000 year. The Gov
eminent contended that Pepco's
profits have been unreasonable
under the sliding scale system in
effect since l945
l943 Rate Now in Effect.
After hearing of the decision.
PUG Chairman James H. FLANAGAN
met with other PUG officials to
determine what the commissions
next step should be.
Pointing out that District con-
Sumers are now paving 1943 rates
based on the Pepco income of 1912,
Mr., Flanagan said the commission
probab bly, VIII issue new rate order
putting into effect the sl.037 900
reduction for the rate wear 1874.
What VIII be done about the rate
year l945 remains to be decided.
Although Pepco filed with the
PUG suggested rate schedules for
apportlOning the excess. the PUG
chairman said no formal approval
of the proposed schedules had as
Yet beef. given by his group.
The annual electric rate hearings
were called By the commission in the
spring of l945. but were adjourned
without the taking OF testimony be-
cause of the Government and COM
pany challenge of the 1914 order.
Mr.. Flanagan. however. held hear
lngS this spring at which PUG and
Government accountants presented
figures on excess earnings by the
company which they felt could be
returned TO the consumers.
New Rate Not Determined.
Company counsel CHALLENGED the
validity of the hearing since the
Court of Appeals had not vet de-
cided the litigation. and refused
TO present any exhibits of their own
in line with this challenge. At the
conclusion of those hearings. the
PUG indicated no new rate sched-
ule would be enacted until the ap-
pelate body made its decision.
Both counsel for Pepco and the
Government said they were unde-
cided as to appealing from the
decision and would have to read
the opinions before making a de-
clSion