Evening star. [volume] (Washington, D.C.) 1854-1972, 1951-02-13
PUG Approves
81 % Boost in
Pepco Rates
Increase to Average
$2.40 Yearly; Fare
Plea Indicated

The electric bills OF District con-
sumers will be increased by an
average Of 20 cents a month as a
result of the boost in annual
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 sched-
ules, which would bring in that
amount over the present rates.
The average Of about 20 cents
month is based on the PUG
allowance of 100000 on the pres
ent residential rates.
The utilities commission also
allowed an increase of $230,OO0
annually on the rate charged the
Capital Transit Co. Pepco had
asked for an increase of $557 900
for the current supplied the
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 no
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 $4,000 for resi-
Dental users. The PUG allowed
s550,000. For commercial rates
Pepco had asked for an increase
of $945,000 for low-voltage users
and $687 900 for high-voltage
users. The PUG allowed S970. 900
for low-voltage consumers and
$4,000 for high-voltage. An in
crease of $697.000 was asked for
street lighting, but the PUG cut
this down to an increase of
$3.50
The entire increase, according
to PUG officials, amounts to 634
per cent.
Duty of Fairness Cited.
In announcing its decision the
PUG said:.
1T 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 ir
the securities of the utility com.
pany."
The decision said the Capita
Transit Co. opposed the increase
in rates it pays for electric serv.
ice; in fact, contended the Pepct
is not in need of any increase If
its overall rates to the public. The
commission said this contention
was contrary to the record anc
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, ano
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 S3.5
million a year. but later cut this
figure down to about $3,37e, 600
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-
! eAOA1CA pHtO,OOU VI lUS ISCOIll-
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 it's con-
struction program.
The PUG opinion said, how
ever, that the commission could
not accept the basic concept that
"today's earnings should be suff-
Gent 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 a 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 il
has previously, that rate of re-
turn of 5l2 per cent was fair. The
$2.6 million figure was predicted
on the year 1851.