Evening star. [volume] (Washington, D.C.) 1854-1972, 1951-02-13
PUG Approves
644% Boost in
Pepco Rates
Increase to Average
S2.40 Yearly; Fare
Plea Indicted

The electric bills of District con-
sumers will be increased by ar
average of 20 cents month as 6
result of the boost in annua,
revenue granted to the Potomac
Electric Power Co.
The Public Utilities Commission
yesterday authorized an increase
of about $2.6 million in Pepco's
annual intake and ordered the
utility to submit new rate SEIZED
ules, which would bring in thai
amount over the present rates.
The average of about 20 cent:
month is based on the PUG
allowance of 100000 on the pres.
ent residential rates.
The utilities commission also
allowed an increase of $230,00(
annually on the rate charged tbs
Capital Transit Co. Pepco hao
asked for an increase of $557.00C
for the current supplied thu
transit company.
May Ask Fare Increase.
E. Cleveland Giddings, vice
president of the Capital Transit
Co., said his company had re-
ceived the PUG order but had nc
chance to digest it. He said the
decision would have to be dis
cusSed with transit lawyers. but
that on the face of it the COM
pany probably will have to ask
for an increase in fares.
Pepco had asked the PUG for
an increase of $470,000 for resi-
dental users. The PUG allowed
$550,000. For commercial rates
Pepco had asked for an increase
of S945, 900 for low-voltage users
and $687,000 for high-voltage
users. The PUG allowed 100000
for low-voltage consumers and
$560,000 for high-voltage. An in
crease of @ 900 was asked for
street lighting, but the PUG cut
this down to an increase of
$265, 900.
The entire increase, according
to PUG officials, amounts to ga
per cent.
Duty of Fairness Cited.
In announcing its decision the
PUG said:
ut has been urged upon this
commission that Pepco does not
need additional revenue. The rec
ord does not support this con-
tention. Again, as always in cases
involving the question of rates for
utility services, the commission
must consider both the fairness of
the charges to consumers and the
fairness and adequacy of the re-
turn to be provided investors in
the securities of the utility COM
pany."
The decision said the Capital
Transit Co. opposed the increase
in rates it pays for electric serv-
ice; in fact. contended the Pepco
is not in need of any increase in
its overall rates to the public. The
commission said this contention
was contrary to the record and
that the Capital Transit Co. was
not paying a fair price for its
electric service.
The increase, the PUG said,
should not prove 'unduly burden
some" to the transit company.
No date has been set for filing
of new schedules by Pepco, and
the increased rates will not &c
into effect until the PUG has ap-
proved them.
Pepco had asked for authority
to increase its revenues by $3.5
million a year, but later cut this
figure down to about $3,379.000.
A spokesman said it was uncer-
tain as yet how long it would take
to file the revised schedules.
For Residential Users.
The power company had appor-
toned $470,000 of it's recon-
mended increase to residential
users, whose bills it estimated
would have gone up 4.3 per cent.
Pepco had based it's request on
financial needs to support its con-
struction program.
The PUG opinion said, how
ever, that the commission could
not accept the basic concept that
"today's earnings should be suffl-
cient to provide a reasonable re-
turn on capital to be invested to-
morrow"
The PUG said it must rely, in
stead, upon the conventional
method of relating fair rate of
return to a deprecated original
cost rate base, which method the
commission believes to be more
reasonable and precise"
The commission decided, as it
has previously, that rate of re-
turn of 5l2 per cent was fair. The
$2.6 million figure was predicted
nm the wear 1881