Evening star., 1954-10-05
Pepco Asks Increase
0fS5,785,OOO Yearly
In Rates for Area

iii KoIGS lUI Al ca
The Potomac Electric Power
Co. yesterday sought permission
to increase rates for its $4,000
Washington area customers to
produce an additional SIS. 5.785 900
in annual gross revenues.
The increase would amount tod
about 10 per cent in the cate
CORY of residential users. For the
average city householder, who
uses 200 kilowatt-hours month,
the monthly bill would go up 81
cents. That would make the new
bill $5.42.
The company said it would
have to have $5,785. 900 more
gross revenue to produce net
income boost of $2,591 900 after
increased taxes on income and
gross receipts.
The rate increase request was
filed with the District Public
Utilities Commission, the Mary
land Public Service Commission
and the Virginia State Corpora
ton Commission.
~ Pet. From ID. C.
The gross increase would be
apportioned as follows: $4,137,-
600, or 72 per cent. from the
District. $1,463 900 from Mary
land and $185.000 from Virginia.
The company said it was ask
ing a return of GA per cent on
the system rate base. In grant,
ing the last rate increase in 1851,
the Public Utilities Commission
held 51a per cent as proper
rate of return.
Company officials said. how
ever, that the return had been
below the sig per cent for the
last year. and now is under 5H
per cent.
The 1851 rate increase is still
involved in litigation in the
courts. The company has asked
the Supreme Court to review a
decision by the U. S. Court of
Appeals for the District of CO.
lumbia that sent the increase
back to the commission.
Decision Reversed.
In remanding the case to the
commission, the appellate court
reversed a 1852 decision of the
U. S. District Court for the. Dis
trict of Columbia, affirming the
commissions action in granting
the increase.
Chairman Robert E. McLaugh-
lin of the commission said a
public hearing on yesterdays
request probably will be sched-
uled early in November.
In a statement accompanying
the filing. r. Roy Dunn, COM
pany president. said present
rates have proven to be much
less than adequate to provide
fair return on the value of it's
properties devoted to the public
service"
He noted that constant addi-
tions and Improvements to the
company's plant and facilities
are required to meet the increas-
ing demands for electricity. Dur
ing the last seven years, the
company has spent more than
S122 million for these purposes,
he said.
The necessary expansion of the
system, he said, has in the past
and will in the future require
large sums of money to be raised
by the company from the sale
OF its securities to the investing
public.
Early Action Urged.
1t is accordingly urgently
necessary" he continued, that
the requested rate boost be made
effective as early as possible in
order to raise company earnings
to a level which will enable it
to accomplish necessary perma-
nent financing on reasonable
terms. and thus continue its
large construction program.
Mr.. Dunn pointed out that
while costs of foods, clothing and
other living expenses have risen
sharply since 1899, the cost of
electric service during the period
has shown little change.
In filing its request, the COM
pany proposed to apply it's COM
mercial rates on a system-wide
basis but to retain a division of
residential customers in an urban
and suburban zone. 1t proposed
to include in a change from sub
urban to urban status these
communities:
In the region northwest of
Bethesda, Md; Hillmead, Wood
haven. Georgetown Village,
Bradley Hills, Bradley Hills
Grove. Longwood and Burning
Tree Valley.
In the region southwest of
the District in the vicinity of
Henson Greek: Forest Heights,
Glass Manor, Temple Hills,
South Lawn, Oxon Hill, Living
ston Oaks and Livingston Park.