Evening star., 1946-12-14
U. 5. and Pepco File
Separate Appeals
For RATE Rehearinq

The Government and the Potoma
Electric Power Co. in separate ap
peals, today petitioned the United
States Court of Appeals for a re
hearing of the Public Utilities Com
MISSIONS order reducing Pepco rate
] by $1,037, ,189.
The utility's petition, filed by At
torneys S. Russell Bowen and 7
Justin Moore, asked for reargu
ment before the full membership O
the appeals court. It was files
shortly after disclosure that ths
Government also had petitioned ths
court.
Pepco's petition pointed out thar
each of the three judges who hearc
the appeal disagreed with the Other
two as to the correct basis for de.
cision' and that therefore the case
has reached a position where re-
hearing before the full court is
timely and fitting"
U. S. Seeks Bigger Cut.
The Government is seeking a
greater reduction than the PUG
ordered.
The appellate court, on November
l8, sustained District Court in up
holding the PUC,s rate-reduction
orders. Actual rulings in the case
had been made by the Court of Ap-
peals last July and the opinions
backed up those rulings.
The appellate court also has up
held the PUG in the appeal taken
against it by the power company,
which sought to set aside the re-
duction altogether. The Potomac
Electric Power Co. has until De-
cember 18 to request rehearing
in that case.
The Government is acting as
Pepco's largest consumer in the cur
rent action seeking a greater re-
duction than that ordered by the
PUG.
The Governments petition for a
rehearing claims numerous errors
were made by the Appellate Court
in its rulings. Among allegations
were that it erred "in holding that
the issues upon the appeal were
limited to whether the order was
(a) arbitrary or capricious, or (b)
invalid as establishing rates that
are unjust or unreasonable.
Exclusion of Surplus Asked.
"Tnis holding" says the petition,
"impliedly excluded from considera-
ton the major issue presented by
the appellant" This was whether
the Public Utilities Commission, "in
reaching its conclusion, was con-
ttolled by an erroneous ruling of
law of the commission that it
was without authority = to ex-
clude any portion whatever of the
Potomac Electric Power Co.'S surplus
from the rate base or from common
stock equity in determining the
basic rate of return"
The petition also claimed the
court imposed upon the Federal
Government IAN unduly heavy
burden of proof by ruling that the
court could not express its judg-
ment as to the unlawfulness of the
Potomac Electric Power Co.'S rates
or surplus unless the appellants
proof went to the extent of show
ing the commission had swilfully
neglected the interests of the con-
sumer.'"
The Pepco petition for rehearing
declareds @In' formal rate proceed
ings in the absence of agreement,
the law requires the commission to
proceed by the standard of fair
value as of the current time, requires
that reproduction costs be given
weight as an important or even pre-
dominant component of that fair
value, and requires that the safe
guards of certain defined procedure
be observed. The commission did
not even purport to do any of these
things in this case"
The petition claims, therefore,
that the PUCps order reducing the
companies rates is void"