Public Regulation of Electrical Utilities

January 9, 1926

Report Outline
Present System of Utility Regulation
The Theory of Regulated Monopoly
Regulatory Features of Giant Power
Proposals for Joint State Regulation
Proposals for Federal Regulation

The primary purpose of public utility regulation in the United States is to insure adequate service to the public at reasonable and equitable rates, on the one hand, while affording to the public utility companies, on the other, a fair return upon the property used in the public service. In the exercise of their regulatory powers to these ends during the last twenty years, the public service commissions have introduced into public utility law a body of new rules and practices of the highest importance-wholly unknown a quarter of a century ago.

As proof that the system of public regulation developed during the last two decades for the control of electrical utilities has been effective, three sets of facts are cited by Secretary Hoover: (1) rates for electric current today are slightly below pre-war, notwithstanding an increase of 100 per cent in wages, and increased costs for fuel and supplies, (2) the total distribution of interest and dividends by the electric companies taken as a whole has never exceeded six per cent upon the value of all properties for rate-making purposes, (3) the industry has expanded to meet public demand by four fold in the last ten years.

“The state commissions may well claim a large portion of the credit for these conditions,” Mr. Hoover adds. “It is my belief that the public service commissions with very little just criticism are proving themselves fully adequate to control the situation.”

ISSUE TRACKER for Related Reports
Public Utilities and Electricity
Feb. 19, 2010  Modernizing the Grid
Jan. 14, 2000  Utility Deregulation
Jan. 17, 1997  Restructuring the Electric Industry
Nov. 20, 1987  Deregulating Electric Power
Aug. 23, 1985  Electricity Supply: Surplus or Shortage?
Mar. 14, 1975  Future of Utilities
Dec. 17, 1969  Electric Power Problems
Jul. 15, 1953  Power Policy
Aug. 04, 1948  Power Shortage
Aug. 04, 1930  Publicly-Owned Power Plants
Jun. 28, 1928  Public Utilities' Propaganda in the Schools
Nov. 12, 1927  Power and Public Utility Issues
Aug. 30, 1926  Rural Electrification in the United States
Jan. 09, 1926  Public Regulation of Electrical Utilities
Electric Power