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The American Energy Consumer
Table 5-30.Index of Price of
Electricity and Natural Gas by Size and Type of User, 1952, 1962,
1972 (Large volume users = 100)
| Type of user |
1952 |
1962 |
1972 |
| Electricity |
|
|
|
| Commercial &
industrial |
|
|
|
| Large light and power |
100 |
100 |
100 |
| Small light and power |
251 |
247 |
204 |
| Residential |
274 |
251 |
210 |
| Natural gas |
|
|
|
| Industrial |
100 |
100 |
100 |
| Commercial |
308 |
227 |
201 |
| Residential |
405 |
289 |
264 |
| Source: Prepared by
the Washington Center for Metropolitan Studies from Edison Electric
Institute, Statistical Yearbook of the Electric Utility
Industry, For 1972, New York, November 1973, Table 45S, p. 53.
American Gas Association. 1972 Gas Facts: A Statistical Record
of the Gas Utility Industry in 1972. Arlington, Va., 1973,
Tables 64 and 79, pp. 78 and 98. |
In general,
new cost-justified structures that reflect the costs of providing
energy should replace the promotional block type of rate structures
now in use. With electricity, such a pricing system also needs to
be geared to peak period use, as is now the case in France. Such a
pricing system would eliminate or at least greatly modify the
present rate system, which causes the poor to pay more per unit of
energy than others. Such a reformed rate system would also slow the
growth in residential consumption generally, thereby easing
possible energy shortages and the air pollution created by the fuel
additional electric generating plants would burn. By slowing the
rate at which plant must be expanded, such a reformed rate system
would give utilities opportunities to find ways of eliminating the
pollutants given off into the air by their existing plants.
Advertising
With air
pollution and energy shortages as immediate concerns, the need for
advertising by energy companies is being challenged. The head of
the Federal Energy Administration recently sent a stinging letter
to the presidents of twenty major oil companies calling on them to
stop the "hard-sell tactics in gasoline."
Increased
prices rather than decreased profits pay for most energy
advertising. With utility advertising, there is little question
that the cost is paid by the consumer, because promotional
activities are usually considered part of the operating expenses by
the utility regulatory commissions. Thus utilities are allowed to
pass these costs on directly in their rates. Some
regulatory