T. V. A. Rates

When Government goes into business, private competitors are generally able to attack its bookkeeping methods on the ground that it pays no taxes, no interest on its investment, sets aside nothing for depreciation or amortization. Operators of privately-owned utilities which must meet these costs argue that there can be no fair comparison between their service rates and those charged by plants publicly subsidized. Last week private operators shook their heads in wonder, worry and skepticism when the Tennessee Valley Authority, President Roosevelt's greatest experiment in public ownership and operation, moved to meet in advance and silence this line of argument by announcing that its charges for Muscle Shoals electricity would include all the regular items that any private power company has to pay. Precisely what items are included and how they were figured will not be revealed until the T. V. A.'s first report comes out, showing profit or loss. But Director Lilienthal proudly announced: ". . . The power project is designed to be strictly self-supporting and self-liquidating."

The average U. S. householder last month paid about 6-c- per kilowatt hour for his electricity. T. V. A. proposed to supply the same class of consumers in the Tennessee Valley at an average rate of 2-c- per k.w.h. Muscle Shoals power is to be sold wholesale to municipalities with their own distributing plants at 7/10-c- per k.w.h. It will be retailed as follows:

1) The first 50 k.w.h. at 3-c- per k.w.h. ($1.50) which in the average home will operate lights, iron, toaster, percolator, vacuum cleaner for one month.

2) The next 150 k.w.h. at 2-c- per k.w.h. ($3) which will keep an electric refrigerator going for 30 days.

3) The next 200 k.w.h. at 1-c- per k.w.h. ($2) which will run an electric range and hot water heater.

4) All power in excess of 400 k.w.h. at 2/5-c- per k.w.h. Thus 600 k.w.h. would cost $7.30 from T. V. A.

Where the Tennessee Valley consumer will pay $4.50 for 200 k.w.h. the same amount of power today costs $10.55 in Manhattan, $9.06 in Knoxville, $8.10 in Denver, $8 in Atlanta, $7.44 in Chicago, $6.85 in Washington. $5.80 in St. Louis, $3.05 in Tacoma, Wash, (municipal plant). T. V. A. hopes to spread its power to the valley's 220,000 farms, not 5% of which are electrified, eventually reducing rates even lower.

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