Evening star., 1948-09-12
Ross|yn Gas Co. Rate
-
Investigation Asked
By Arlington PUG

The Arlington Public Utilities
Commission yesterday recommended
that the County Board press for
investigations Of the Rosslyn Gas
Go. by both State Corporation Com
mission and the Federal Power
Commission.
In 2,500-word report on its
study of Rosslyn Gas Co. rates, the
PUG termed "grotesque' the "ex-
treme disparity" between rates and
expenses Of the utility when COM
pared with those in other areas and
with the national average.
The PUG asserted that the Wash
ington Gas Light Co., which owns
the Rosslyn concern. burdens the
local company with excessive
charges that cost Arlington con-
sun1ers hundreds of thousands Of
dollars each year.
Board Accepts Report.
The report was requested by the
County Board last April and was
prepared by a subcommittee of the
PUG comprising Albert A. Carretta
and Laurence S. Knappen. The
board yesterday accepted the re-
port but took no action.
Two weeks ago the Board asked
that another study be made of the
possibility of a rate reduction in
view of the new connection which
the Rosslyn company is making
with its source of natural gas. The
gas now is piped from Rockville,
Nd, via the District. The new
connection will be made near Hern-
don, Va, in Fairfax County, to the
line of the Atlantic Seaboard Corp,
which runs on to Rockville, and will
mean that the gas will be piped d.
rectly into Arlington.
The report declared that the rate
which the Washington company
charges the Rosslyn concern has
been reduced about 80 per cent
since July /, l946.
"T1e resulting savings Of some
tz00, 900 o year In wholesale cost has
been pocketed In toto by the Ross
lyn Gas Co., with no reflection in
the retail rate" the report asserted.
According to the PUG, report of
the State Corporation Commission
shows the Rosslyn Arm saved In,
excess of $250,000" for the IL months
ending December 81, 1947, as a re-
suit of conversion to natural gas.
The sec found, the report said,
that the Rosslyn company had
net 1947 income of s267, 1856, and
that the rate of return on an aver
age net investment of s5.323,684
was 5.02 per cent compared with 345
per cent in 1916.
Cost, Sales Figures Cited.
The report said that the Wash
ington company in 1947 bought gas
for about 80 cents per 100 cubic
feet, then sold it to its subsidiary
for 81 cents per 100 cubic feet. The
gas then was retailed in Arlington
for 1851 cents or PLOT cents per
100 cubic feet.
A distribution cost OF 800 cents
per therm was reported by the
Rosslyn company, the PUG said.
This, 1t pointed out, compared with
o47 cents in Cincinnati, Ohio, for
example. Customers collection and
accounting costs in Arlington and
Alexandria were reported as 1.41
cents as against a cost of Ole in
Cincinnati. and sales promotions
"osts were 0.s5 cents as against 0.07
in the State of Ohios
1T will be remembered that most
- Re AirANflt, at |
tlil.utable to the Rosslyn Gas Co.,
:1ut are the results of allocations by
the Washington Gas Light Co. to
the Rosslyn Gas Co., on the basis
Of formulas determined by the par
mt company and which have never
heen disclosed to U.S." the PUG as
erted.
The PUG said 1t had been in
'Grmed by a member OF the sec
aft that the rate of return OF the
-ompany was expected to excel 6
ner cent by July /, 1948. Six per
.ent is the maximum allowed by
The sec.
Excess of 6et Return Seen.
SIT seems reasonable to assume
that the rate of return presently
realized by the company is in excess
of 6 per cent a"
1T seems to us significant that
the parent company reported
its net earnings after depreciation
and taxes at s2,865, ,461 for the II
months ended June 80, 194s. as
against only $1,742,2s5 for the COM
parable II months ended June 80,
1s47, or an increase in earnings of
approximately 64 per cent the
PUG declared.
The Federal Power Commission
inquiry recommended would con-
Germ the rate charged the Rosslyn
concern by the Washington Gas
Light Co. The PUG figured that
the latter made gross profit Of
s2o7,43 on the sale Of gas to the
Eosslvn utility In 1947.