Rural Electrification and Power Rates

Report Outline
Administration's Efforts to Extend Use of Electricity
Course of Rural Electrification in United States
Methods of Increasing Rural Use of Electricity
Current Attempts to Reduce Electricity Rates
Special Focus

Administration's Efforts to Extend Use of Electricity

Promotion of a greater use of electricity by present consumers and extension of its benefits to areas where this form of energy is not now available have been prime objectives of the Roosevelt administration from the outset. Cheap electric power was strenuously advocated by the President, in connection with the proposed St. Lawrence development, when he was Governor of New York. Since he has entered the White House, he has urged ratification of the St. Lawrence treaty, obtained congressional approval for inauguration of the great Tennessee Valley development, and supported the continuation or initiation of other large hydroelectric projects with public works funds. That the President intends to press with unremitting vigor for expansion of his power program was indicated on November 18, 1934, when he told the people of Tupelo, Mississippi, first city to use T. V. A. power, that “what you are doing hero is going to be copied in every state of the Union before we get through,” Public development of power projects selling energy at rates substantially below those charged by commercial companies has been encouraged by the President to provide “yardsticks” with which to measure and to force down existing rates. An exhaustive report on the cost of distributing electric power, prepared by the Power Authority of the State of New York and made public at the White House on November 12, held that rates only slightly more than half of the average now prevailing in that state were wan-anted, and contended that completion of the St. Lawrence project would bring to users of electricity in New York, New Jersey, Pennsylvania, and New England an annual saving of $194,000,000, or 27 per cent of present charges. Realization of such savings in that area and in regions within the field of other projects would presumably result in greatly increased use of electricity.

Potential Market in Greater Rural Electrification

While this country uses more electric power, in the aggregate, than any other country, it lags far behind various European nations in utilization of electricity on farms. Whereas less than 12 per cent of the total number of American farms have central-station electric service, the proportion in some countries of Europe is as great as 50 or 60 per cent. The generally compact nature of the European countryside, in contrast to the vast extent of many American agricultural tracts and the consequent isolation of farms located thereon, accounts in large measure for the greater extent of rural electrification abroad. Although there are difficult obstacles to overcome, it is clearly the conviction of the administration that rural electric service can nevertheless be substantially extended in this country.

The advisability of taking prompt action to increase the general use of electric power was emphasized by David E. Lilienthal, director of the Tennessee Valley Authority in charge of power development, in a speech at Atlanta on November 10, 1933: