Evening star. [volume] (Washington, D.C.) 1854-1972, 1959-03-06
Challenge Sill
Clouds PEpCO
Rate Rise. Plea

The Potomac Electric Power
Co.'s application for q SOS per
cent rate increase was stu In
dispute today. vN
Spokesman for the General
Services Administration. the
Arlington County Board and
the District Public Utilities
Commission staff differed with
company officials over the util-
ity's earning needs yesterday.
James K. Macintosh. GSA
ofiicial and spokesman for
PEPCO's biggest customer, and
Lloyd B. Harrison. p. u. G. chief
counsel. disputed PEPCo asser-
tons that the firm faces an
emergency. Mr.. Macintosh
fiatly opposed the eornpany's
application. But Mr.. Harrison
did not rule out possible need
of q rate rise.
j. William Falk, chief ac-
countant, is scheduled TO sub.
NIT commission star recon-
mendations Monday. A pro-
posal for some increase is con-
sidered likely.
Figures Protested
Mr.. Harrison, at @ hearing
session yesterday, objected to
company figures on its 1858
earnings. He said the utility's
claim of a return of SEA per
cent for the year was based on
an end-of-year rate base "in-
fiated" by stable late-year
additions to capital investment.
A sounder figure, he said,
would be a 5.79 per cent return
computed on a weighted aver
age base for the full year.
Company spokesman coun-
tered by noting that the COM
mission in 1855 allowed an end
of-year computation as the
basis of the company's last rate
rise. The commission then set
a range of SIS to 5.85 per cent
as an adequate rate Of return.
Charles L. Carr, PEPCO vice
president, also emphasized that
the firm feels its earnings are
slipping and that. it urgently
needs to bolster them to attract
investors, in order 10 finance
large scale planned service ex-
pansion.
Donegan Mann. GSA at
torney, like Mr.. Harrison
questioned PEPCO use Of the
end-of-year rate base. Mr..
Macintosh told the commission
the utility "is not entitled to
any rate relief"
James F. Reilly. PEPCo
counsel, accused the GSA
Spokesman Of opposing for OPP
positions sake"
Exclusions Urged
Charles E. Hammond, ex-I
ecutive assistant with the
Arlington County Public Util-
ties Commission, appearing on
behalf of the Arlington County
Board, also criticized the COM
pany's rate computations. He
urged exclusion from the rate
base of SAL S million in new
electric facilities not yet IN
service, or at least limiting the
account taken Of these facili-
ties in determining the COM
pany's allowable earnings.
Mr.. Harrison questioned
whether the company had
taken part in a national elec-
trio companies advertising pro-
gram currently under study by
the Federal Power Commission.
The Federal agency stan has
questioned whether the util-
tiles properly charged the cost
of the advertising to operating
expenses.
Mr.. Carr said PEPCO spent
S26,732 on the program in 1857
and $27 .406 last year. The
Federal commission staff sug-
gested only that some OF the
money should have been &C.
counted for differently. he said.
The commission itself has yet
to act on the subject.
PEPCO has told the Public
Utilities Commission it plans
to ask revision Of its present
5.85 per cent earnings CELL
ing and still higher rates for
consumers late this year.
1t originally asked for the
rate increase being considered
in the present, proceedings by
March /. Any increase granted
by the commission is unlikely
to take effect until next month
at the earliest.