Full text of "The story of California, supreme in electrical development, as told to business leaders at the Pacific Coast Industrial Conference held on June 10, 1921, Del Monte, Cal"

See other formats

engineering

T .ihrarv

Supreme in Electrical Development

Story" §f California

Supreme in Electrical Development

As told to business leaders

at the Pacific Coast Industrial Conference

held on June 10, 1921

Del Monte, Cal.

Engineering
library

Journal of Electricity

and Western Industry

February 1,

1922

THE Story of California, as told to business leaders
assembled in the Pacific Coast Industrial Conference
at Del Monte on June 10, 1921, is the story of modern
progress and development through the help of Electric
Power. More than that, it is the story of how fundamen-
tally necessary electric power is in every phase of our
daily life, and of what allegiance each of us owes' to the
development of this great modern force.

The Pacific Coast Industrial Conference was arranged
by the Pacific Coast Electrical Association, for leaders in
all phases of business life in the West. The data given
herein was compiled by the Journal of Electricity and
Western Industry, under the leadership of its editor,
Mr. Robert Sibley, from statistics gathered by this jour-
nal with the cooperation of the fifty-eight power com-
panies of the West. As this information was gathered
from four thousand industrial plants of the West, no-
where else may be found such complete data on the
close relationship of your business to the public service
industry.

The information in this booklet is given in the form of
excerpts from the several addresses made by the vari-
ous speakers at the Industrial Conference, and is here-
with presented to the public in published form
through the courtesy of the Journal of
Electricity and Western Industry.

785368

What Private Initiative Has Done for the West
in Hydroelectric Development

The greatest interconnected system of power transmission lines
in the world: Medford, Oregon, to the Mexican Border and up
into Nevada. On January 1, 1922, there is in this interconnection
over a million horsepower from hydroelectric generating plants
and five hundred thousand horsepower in steam generating plants.

The largest concentrated block of electric power ever available for
public use, made possible by this interconnection. The total annual
electrical energy delivered to consumers in this vast interconnection
is rapidly approaching four billion kilowatt hours.

The highest per capita use of electricity of any community in the
world: the Western States. In one of the states the per capita con-
sumption has reached the wonderful total of 2000 kilowatt hours.
The average per capita use in the west is over twice the per capita
use of the nation as a whole.

The first long distance transmission line: 20 miles at 10,000 volts
from San Antonio to San Bernardino, California.

Longest high voltage transmission: 87,000 and 55,000 volts, 539
miles, from Mono county, California, to Yuma, Arizona; Southern
Sierras Power Company.

Highest voltage transmission ever attempted in the world: Present
record of actual operation, 150,000 volts, 240 miles, Big Creek to
Los Angeles; Southern California Edison Company. The Great
Western Power Company has constructed and will soon operate
at 165,000 volts, a 200-mile line from its Caribou plant on the
Feather River to San Francisco. The Pacific Gas and Electric is
now installing a 190-mile, 220,000-volt line from Pit River to the
Bay District, which will undoubtedly stand as a supreme accom-
plishment for many years.

Highest privately owned dam in the United States: 295-foot Lake
Spaulding Dam, Pacific Gas and Electric Company.

Highest head reaction turbine in the world: two 25,000-hp., 810-foot
head units in Kern River No. 3 plant, Southern California Edison
Company.

Highest head hydroelectric plant in America: 2131-foot head, Big
Creek No. 1, third unit, Southern California Edison Company. Plans
have been drawn for three plants developing close to 2500-foot
head on the Kings River and Big Creek, by San Joaquin Light and
Power Corporation and Southern California Edison Company.

Largest high head impulse turbines in the world: two 30,000-hp.,
1008-foot head units in Caribou Plant, Great Western Power
Company.

Other large units: Two 40,000-hp., 454-foot head reaction turbines,
Pit River No. 1, Pacific Gas and Electric Company; 23,000-hp. re-
action turbines, White River plant, Puget Sound Power and Light
Company and Long Lake plant, Washington Water Power Company.

THE West abounds in swift mountain streams, now running idly to the
sea, which are susceptible of harnessing in the beneficial production of
hydroelectric power. California alone can produce nine million horse-
power in this way, and in the eleven Western States lie seventy per cent of
the nation's undeveloped water power. On the stream shown in this illus-
tration one power company is carrying through a development which will
ultimately produce over eight hundred and fifty thousand horsepower.

Business Leader's Conference

Introductory Remarks at the Opening

of the Pacific Coast Conference

of Business Leaders

Del Monte, California, June 10, 1921

Mr. John B. Miller, President Southern
California Edison Company, presiding

IT is a great pleasure to me to preside over this
meeting this afternoon, which has been called for
the purpose of explaining the definite relation ex-
isting between our power companies and industry. I
have devoted twenty-five years of my life to bringing
about a better understanding between the corporations
engaged in our business, and between those corporations
and the people. I have done so because I believed from
the very first that to realize this ambition which is mine,
and which I know is yours, is a public service. The ambi-
tion to give the very best service at the lowest rate — to
be an efficient public servant — can only be realized by the
thorough understanding that our interests, both between
sister corporations and between those corporations and
the public, are identical, and that we must have harmony
if we are going to realize our ambitions.

Now, in carrying on that work I haven't been alone.
I don't wish to give that idea. You all have been most
generous in that same kind of service, but in carrying out
that work there has been one who has been of the greatest
service through the columns of his journal. He has
month after month and year after year worked for that
same ideal, and I know that you feel as I do when I tell
you that that man is Robert Sibley, who is now going to
speak to you.

[Page Seven]

Storjr §f California

The Basic Role of Electricity

BY ROBERT SIBLEY
Editor, Journal of Electricity and Western Industry

THE subject of hydro-electricity and its generation is
one of such difficulty to the layman that it seemed to

me a good plan to give you one or two of the very
fundamental things about it so that you may undersand
what we are talking about and get some conception of
what we mean when we speak of hydroelectric energy.

About a hundred years ago, to be exact, in 1830, there
lived in this country a young man named Joseph Henry,
and it was due to Joseph Henry, an American, that the
great laws of electricity became so known that we could
harness our water power. A simple experiment will give
you some conception of how the thing works, as the say-
ing goes. You are all familiar with what is known as a
horse shoe magnet. Well, Joseph Henry found that when
he took an ordinary wire and dashed that wire across the
end of a magnet a current of electricity began to flow in

The magnet on the left in Fig. 1 represents the electrical generat-
ing equipment in the power plant. When the wire is dashed across
it, a current of electricity flows along the wire in the direction
shown by the arrows. The reaction between the current thus
caused to flow in the wire and the magnet at the right, representing
the electric motor in the factory, causes the wire to move back or
forward in the direction opposite to that of the wire at the left
magnet.

that wire. No one knows exactly why it does, but that
was the thing he found. He was the first to discover
that law. That is all the thing is, simply a wire dash-
ing across in front of a magnet causing a current to go
alternately back and forth in the city far away. And,

[Page Eight]

Electricity's Basic Role

by the way, it is interesting to note that Henry never got
the credit for that law. A man over in England by the
name of Michael Faraday one year later published this
law and in late years it has become known as the Faraday-
Henry Law.

Fig. 2. The latest record in high voltage transmission — the 165,000-
volt line of the Great Western Power Company.

What is shown in Fig. 2 is part of a modern electric
transmission system. You can readily see that as the
miles of wires go into the city it is necessary to support
these wires and in supporting these wires there may be a
leakage of current down to the earth. The great problem
that came about in the transmission of this hydroelectric
energy was to evolve some system by which there would
be no leakage from the wire down to the earth. The
solution of the problem came about through the develop-
ment of efficient insulators, capable of withstanding these
high voltages. This illustration shows the latest insulator
used in the latest record established in hydro-electricity,
the 165-000-volt line of the Great Western Power Go.

[Page Nine]

Story" §f California

Now, even though this law was discovered back as
early as 1830 it was not until almost three-quarters of a
century later that we really began to apply this informa-
tion in harnessing our water power. California has been
the pioneer in this. I remember as a boy in Ontario; in

hONEL"1"" INDUSTRY

FARM

Fig. 3 is a sketch illustrating a typical modern electric power
system with its hydroelectric generating project and transmission
line and the distribution lines that carry the electric power to the
users in homes and offices, on the farm and in the mine.

those days they pointed to the longest high tension line
in the world, and that was the line running from Ontario
to San Bernardino, about twenty-three miles at ten thou-
sand volts. Today we transmit power at one hundred and
sixty-five thousand volts over two hundred and thirty
miles and those distances and voltages are constantly be-
ing lengthened and raised.

When we think of water power we usually think of
some great Niagara. In the state of California, as a mat-
ter of fact, we don't have any great waterfalls, but we
do have great gorges in the mountains making it possible
for us to create an artificial waterfall, as it were, by

[Page Ten]

Electricity's Basic Role

diverting this water, taking it out of the stream and
taking it around the mountain in a ditch at a grade less
than the natural bed of the stream. Then, when we build a
tunnel, say eight or ten miles long, we get a difference in
elevation as much as two, three or four thousand feet,
making it possible to drop this water that distance.

Now, as to what a horse power means. Suppose
flowing in front of us is the stream shown in Fig. 5.
It is winter time and there are many chunks of ice,

Fig. 4 is a sketch of an actual hydroelectric project, the Feather
River development of the Great Western Power Company. Notice
how the water is first stored in a great artificial reservoir formed
by a dam, and is then carried by tunnels and streams to the point
where it is dropped down to the power house for the generation
of electric power.

each one measuring a foot each way, 1 cubic foot, and in
front of our vision, we will say, every second passes one
of these chunks of ice. Now, a chunk of ice one foot by
one foot by one foot weighs about sixty-two and one-half
pounds. Let that drop twelve feet and it would represent
practically what a modern electric horse power represents
in energy. So, when you go into the mountains and see
a stream of water, picture to yourself these chunks of

[Page Eleven]

Story" §f California

ice, one foot by one foot by one foot, and picture that
every time they drop twelve feet you have a horse power
flowing eternally for the development of your different
industries in California. That gives you the fundamen-
tals of hydro-electricity.

Fig. 5. One cubic foot of water per second falling twelve feet
represents the equivalent of one electrical horsepower

Out West here we have developed to a stage that is
equaled nowhere else in America. We are talking about
A B C's, so I brought some ABC blocks along. Let's
see how we have developed out West. Look at Fig. 6.
The single block represents the unit development back
East. That is what the average citizen uses in steam and
electric power back East. The average citizen out West
uses just twice as much, as shown by the two blocks.

Let's take the case of hydroelectric development.
The amount the East has developed hydroelectrically in
proportion to their population is represented by one block,
while out West we have one, two, three, four, five, six
times that of the East, as shown in Fig. 6B.

Now, as wonderful as that may be, what of the
future? What are the possibilities the average citizen
has in regard to hydroelectric energy in the future ? Refer
to Fig. 6C. Let the one block be the proposition back East.
Then, one, two, three, four, five, six, seven, eight, nine,
ten, eleven and multiplied by two — twenty-two times the
possibilities in the West as compared to the East — so you
see we live in a hydroelectric domain that is equaled
nowhere in the world.

[Page Twelve]

Electricity's Basic Role

A Western aggressiveness in power develop-
• ment and western progressiveness in util-
izing the most desirable form of power has
led to a per capita development double that
of the eastern states.

BThe much greater
• hydroelectric de-
velopment in the West,
per capita, is a quite
natural result of west-
ern initiative and the
greater abundance of
available water powers.

CThe future electrical de-
• velopment in the West,
per unit of population, will
far exceed that of the re-
mainder of the nation, be-
cause of the great prepon-
derance of yet undeveloped
water powers which are ca-
pable of being economically
exploited for the benefit of
western industries.

Fig. 6.

Representation of comparative electrical development,
East and West

[Page Thirteen]

Story" §f California

Now, I am going to show some charts and pictures
that will illustrate some of the wonderful physical feats
that have been accomplished. You know in harnessing
this great water power, our engineers have accomplished
feats of engineering daring that have been equaled no-

Fig. 7. Typical power development in the western mountains — the
Kern River Canyon Plant of the San Joaquin Light and Power
Corporation.

where else in the world. I am going to point out just a
few and then show you some of our industries; what
wonderful things some of our industries are doing through
this giant force of electricity, and other speakers will
follow, showing you how that connects with our civic and
industrial life.

Now, I have pointed out what water power is. Fig.
7 shows an actual application of this idea. A reservoir
has been built, and the water is brought from it in a
tunnel through the mountain side, and then dropped
down to the power house over on the right. That is where
the electric magnet exists. Coming from it are the wires
that stretch out across our valleys to feed our farms, up

[Page Fourteen]

Electricity's Basic Role

In Fig. 8, you see a picture of the West in which these great trans-
mission lines have been mapped. No other place exists where
transmission lines are built to such a great extent of distribution
and such high voltage. There is a solid chain of these lines from
Medford, Oregon, down to the Mexican Border, and then up into
Nevada, a distance of fourteen hundred miles. We have one con-
nection of the Southern Sierras Power Company which totals over
five hundred and thirty miles from the eastern side of the Sierra
Nevada Mountains down to the Mexican Border — the longest trans-
mission line in the world.

[Page Fifteen]

Story* gf California

into our mines, and run the industries in our cities and to
light the homes.

Let us see what is happening in the harnessing of
these forces of nature. In the first place it required the
building of great dams such as the genius of man never
before attempted. The big one shown in Fig. 9 is a dam

Fig. 9 shows the mammoth Lake Spaulding dam, Pacific Gas and
Electric Company, while under construction. This photograph very
clearly portrays the magnitude of construction work that is often
necessary to harness the natural water power resources of the
West, and indicates what great obstacles must sometimes be over-
come. The building of this great dam, for example, required the
building of a branch railroad for many miles through the moun-
tains and the transportation of supplies across deep canyons on
cables high in the air.

in California, the Spaulding Dam, which rises 295 feet
above the stream bed. Let me give you an idea, in a
comical way, of how much water is actually contained in
such a dam. If 100,000 people each drinking a quart of
water a day, started drinking about the time of Noah,

[Page Sixteen]

Electricity's Basic Role

they would have drained this reservoir dry about the time
the whole country went dry for another reason. But the
vision of the West has not ceased there. We find our
engineers today even going far beyond that vision. We
hear it being talked of by the engineers that dams will be
built even four and five hundred feet in height.

The two giant hydraulic power units shown in Fig. 10, are develop-
ing 25,000 hp. each, under a head of 810 feet. This is the highest
head in the world for water wheels of this particular type, which,
by the way, were designed and built in California. At the time
they were installed, these wheels were the largest ever installed
west of the Mississippi.

The installation shown in Fig. 10 breaks a world's
record. It took place under Mr. Miller's supervision, in
Kern River No. 3 Plant, where have been installed two of
the largest hydroelectric turbines in the West. They were
put into commission last month, so you see we are con-
stantly, as months go by, expanding these records, making
new records, and most all the time, mark you, it is a west-
ern record that is broken and by a western person.

[Page Seventeen]

Story §f California

It is very often necessary to stretch wires over a
great distance, for instance, across streams of water and
over lofty canyons. One of the crossings, known as the
Carquinez Crossing, stood for seventeen years as the
world's greatest and longest span of wire, almost three-

Fig. 11 shows one of the electric power transmission lines crossing
Carquinez Straits, San Francisco Bay — the 4427-foot span of the
Pacific Gas and Electric Company, which for seventeen years stood
as a world record. Recently a second line was hung across this
stretch of water — a span of 4753 feet carrying 165,000 volts for
the Great Western Power Company.

quarters of a mile in length. It has been broken in the
last year or so, but it took this precedent in California
to give them the vision and the courage to do it.

I could go on enumerating the wonderful things that
have been accomplished, but I will now allude to a few of
the uses of electricity which are even as wonderful, and
in many respects more wonderful than these physical

[Page Eighteen]

Electricity's Basic Role

barriers that have been overcome. In the first place,
Electricity in the Home. Fig. 12 is the picture of a build-
ing that was built in Los Angeles about a year ago, known
as the Electrical Home. Today electrical homes are
being put up in different cities to give a conception
of what the modern electrical home can accomplish.

Fig. 12 is one of the numerous Electrical Homes that have been
erected throughout the West to drive home the more extended use
of electricity in the home. Similar homes have been demonstrated
in San Francisco, Oakland, Sacramento, and in the Northwest and
have been visited by thousands of interested men and women.

Those homes are electrically operated' throughout —
electric washing machines, electric toasters, electric re-
frigerators, and so on. But the wonderful thing about
California is that we have developed the use of electricity
in the home as nowhere else in the nation. Comparative
figures tell the story. In 1910, in the districts served by
central stations, California had 75% of her homes wired
for electric service. In 1920, 83% of these homes were
wired for service, while for United States as a whole
only 35% of the homes were wired.

[Page Nineteen]

Story" §f California

Fig. 13 is typical of the immense stretches of land in California
arid the West that are lying idle and non-productive because of the
lack of water for irrigation.

Fig. 14 shows what irrigation by electric pumping will do for idle
land. The San Joaquin valley, as an example, where this photo-
graph was taken, owes much of its present development and pros-
perity to the irrigation made possible by electric power.

[Page Twenty]

Electricity's Basic Role

Now electricity on the farm. Wonders have been ac-
complished. Acres of idle bush-covered land is the ordi-
nary situation familiar to all of us in our barren lands
in the West. As some one said in traveling all day over
that land, he met only one inhabitant; that was a jack-

One of the greatest western accomplishments is the electrification
of the Chicago, Milwaukee & St. Paul Railroad, Fig. 15, and today
engineers are coming from all over the world to visit this great
undertaking.

rabbit and he was leaving the country as fast as he
could run.

Now, our land may be irrigated by gravity system or
pumping the water. The gravity system has been prac-
tically completed in the West so we must rely on pumping
in the future.

Over a third of the lands in California are electrically
pumped and irrigated. The agricultural development in
this state depends upon the way we can harness our water
power, to make possible this great modern servant — the
electrical pump.

There will be alluded to this afternoon the question
of the use of oil on our railroads, and we all look forward
to railroad electrification as a possibility in the future.

[Page Twenty-one]

Story* §f California

Fig. 16 shows one of the numerous electrically operated gold
dredges that are at work in the West, profitably recovering gold
from gravel beds that previously were allowed to lie untouched
because there was no other power available that could produce the
gold at a low enough rate. This is the largest gold dredger in the
world. It is electrically operated throughout.

Now, in mining. It was in mining that we found our-
selves, and yet if it were not for electricity today our
mining would not be in anything like as good condition
as it is. Fig. 16 illustrates to you the electrically op-
erated gold dredges which today still keep California in
the front rank of gold production in the United States,
making possible the utilization of the old gold fields of
California, scraping up the gravel, and washing out the
gold even though it is in very small quantities, very often
only six or seven cents a yard. They turn out the gold at
a cost of only three cents a yard, through the use of elec-
tricity, and as I stated, make possible California's main
taining her first position still in the production of gold.

Other branches of mining make equally important
demands upon electric power, over twenty per cent of the
power sold by western power companies being used in the,
mines.

[Page Twenty- two]

Electricity's Basic Role

Fig. 17 shows the sanitary sealing machines in a California fruit
cannery. Electricity plays a major part in preparing this great
output for the market. Individual motor drive with its attendant
freedom from shafting and its greater flexibility is the great
advantage of electricity in this field.

The gangs of rolls in steel mills, Fig. 18, driven by single motors,
require a large percentage of the power used in the mills. This
photo shows a 1500-hp. motor driving a 22-inch and 18-inch mill
table.

[Page Twenty-three]

t3fe Story §f California

Now, as to some of our other industries. We all
know that the fruit packing industry — the canning indus-
try is one of our great things here. Electricity makes

possible the canning of fruit in the best of ways. The
work is all done by machinery and a cleaner and more
economic production than formerly is now possible.

Fig 19 shows an interesting use of electricity in the steel indus-
try— an electric magnet for handling ingots. Electric current is
turned into the magnet and the ingots picked up. When they have
been shifted to the desired position the current is turned off and
the ingots are released by the magnet. Ingots weighing hundreds
of pounds are moved as easily and quickly by the magnetic crane
as you or I could move a box of apples.

In the steel industry, which though new on the
Pacific Coast is here to stay, a very heavy and extended
use is made of electric power. One mill alone, in San
Francisco, has a connected motor load of 16,000 hp., and
this power is used for every conceivable kind of work.
The operations in the furnace galleries, the moulding pit,
ingot storage yards, transportation, rolling, cooling, cut-
ting and fabricating shops and all other departments,

[Page Twenty-four]

Electricity's Basic Role

depend completely on electricity for their power. It is
interesting to know, also, that this mill will be greatly
dependent on electricity in the railroads, when electrifica-
tion comes, as it is the largest individual shipper on a
tonnage basis in the western states.

The question of refrigeration is a great problem in
California. We must ship our products to the East in
iced cars, and electricity plays a part in the making of ice.

The ice plant in Fig. 20 is one of dozens of such plants along the
railroad lines of the West. The tremendous problem of the trans-
portation of perishable fruit and vegetables has brought the refrig-
eration industry well to the front among the consumers of electric
power in the West. The consumption of electricity in this industry
is very large, so that the electric bill bears a greater relation to
the costs of manufacture than is the case in most fields. Electricity
has proved such an ideal motive power, however, that it is very
generally used.

Oil itself is a fuel and yet this great modern servant,
electricity, has gone into the oil fields to make it cheaper
to produce oil, and cleaner than oil can do it itself.

Many of our mountain lakes and the salt beds of the
desert regions have valuable chemical deposits. The pro-
duction of the salts and many other chemicals has been
made possible through electricity and the chemical indus-
try in these sections has shown a tremendous growth
during its five years of existence.

[Page Twenty-five]

California

Fig. 21 illustrates the economy of electricity in the oil fields.
Pumping jacks, driven by single electric motors, pump oil from
dozens of wells surrounding them and do the job at a low cost and
without fire hazard. The jack shown, driven by a 25-hp. motor,
is pumping twenty-seven wells.

The plants shown in Fig. 22 are the Borosolvay plants of the
Pacific Coast Borax Company and the Solvay Process Company
at Searles Lake, California. All of this region is rich in borax and
potash deposits, and electricity is used extensively in the recovery
process. Over 11,000,000 kw-hr. were used by the chemical plants
of this vicinity in 1920.

[Page Twenty-six]

Electricity's Basic Role

I will briefly show you in a statistical way some of
the ways electricity operates. In the western states 14%
of the electric power developed goes for lighting homes;
26% goes toward operating railroads; 28% toward manu-
facturing; 11% toward agriculture. In California the

PACIFIC CENTRAL

INTERMOUNTAIN
AND SOUTH -WEST

ALL WESTERN STATES

Fig. 23 gives the distribution of loa,d of the western power com-
panies. California and Nevada, represented in the Pacific Central
division, show particular activity along the lines of agriculture and
manufacturing, while Northwest development centers in manufac-
turing activities, and the Intermountain and Southwestern districts
are especially well represented in the mining field, with a sprinkling
of agriculture.

amount of electricity used for agriculture is much more,
being 17%.

Now, as to some of the general proportions, to show
you what proportion of electricity is used in the various
industries. You notice the metal trades is first ; food pro-
duction comes next, and so on down the line, which gives
you an idea as to the proportionate uses of electricity in
the various industries.

Now, as to what a single plant uses. The plants hav-
ing the largest installed capacity are the steel manufac-
turing plants, as I have said above. The average plant
reporting to us in this survey used almost ten thousand

[Page T wen ty- s even ]

Story* gf California

£_

\ 1 $

frv* § $

£ C: V *< 'C

> £

\ *&

1 i

Fig. 24. Distribution of Manufacturing Load — Seven Western
Power Companies

9.JOO

834

14DD

""j

322

_,2/5

/JJff

Me^al Trades .

7ft

(ofher thensteel)

IOT

Confectionery

tot*

f/9^

^59

rv;

CJ??

f^'l.tr. Fpprf

^/?

^r^

"^^

Grain Product

f}J

^ ^

__^

^ ^

_Z£

.^/o/y prinks

^ <^>

6*11

_/J2

1^3 c>

, ^/

™

i»s4her

£4

fr f na

Fig. 25. Installed Capacities of Motors in Average Plant

[Page Twenty-eight]

Electricity's Basic Role

horsepower. The next industry is the cement industry.
Then, along down the line is the chemical industry. I am
calling your attention to the chemical industry to show
you that in some instances, although there is a large
horsepower installed, the relationship varies when you
come to the actual power consumed.

Kilowatt

At**/ Mfy

/!•

Mine*

? '

,9,

Paotr

, (

Chemtca/.s

Metal frades
Re.fr/gervtoKs
Wood products
Grain products
frii-sc Food

7 Z

4 f,

if<

f?(

Js,

C/ayprcx/ucfe

f ;

/fit

7lQ

i».

Soft drinks

ft*

I umber

8fi

•s:

Confectionery
.te/+

7fl

i»\

(

<J7

Pd'rrie-z

<7,9

*-r>
•~^

Tcjcfi les

0.9

C<?/?r?er/'&s

Pr/n-f-iny

)

Laundry

farnjg

l(\

Leather

flfl

Fig. 26 gives the relative annual consumption of electric power by
the various classes of western industrial plants

Cement plants actually used more power, although
the steel plants have the largest installed capacity. That
is because they use it continuously and the other fellow
only on and off. The chemical industry, you notice, made
quite a step toward the front. The chemical industry can
probably get a much cheaper rate.

Another interesting way of regarding electric power
and its value to industry is to compare the value of out-
put of any industry and the kilowatt-hour consumption

[Page Twenty-nine]

Story §f California

required in its production. Or, expressing it another way,
how much the production is in dollars and cents for every
kilowatt-hour of electric power consumed. The meat
packing industry produces $12.46 worth of goods for
every kilowatt-hour consumed; fruit canning, $11.35;
dairy products, $8.90, and so on. This gives a conception
of how dollars and cents are made for industries of this
country by the utilization of electric power.

Meatpacking

Cdnnedaoods

Dairy

PaperproJuck

Grain

Textiles

Fig. 27 is the converse of Fig. 26, in that it indicates the value
of the output per kilowatt-hour used. The average charge made
for this kilowatt-hour at current western rates is about 1.3 cents —
a very small fraction of the total cost even in those industries
using the largest amount of power per unit of output.

Irrigation and pumping in the West shows a decided
reaction to electricity. Irrigation by the gravity system
has remained practically the same, but electrical pumping
from 1910 to 1920 took a decided jump and has been

[Page Thirty]

Electricity's Basic Role

too

MML iNDusmts

J7t*m

Percent increase in value

of output and K.YJ.hr. consu

iption.

13 10- ISIS- 1920

9437%

/64%

too-/.

IDOia

1/26%

v"ue d/lJl

' KW.hr. Consumption

1315

Fig. 28 indicates how the remarkable growth in the value of output
in the metal industries has been matched by the kilowatt-hour
consumption. When the difference in the value of the dollar
between two years is taken into consideration, it is apparent that
the use of electricity has increased intensively as well as extensively
in this period.

200

LUMBER INDUSTRY

TJI'lo

Percent increase in vslue

f out-put and HvJ.hr consur,

iption

ISO

ISIO- ISIS -1320

.100

/J2*A

100%

OO'lo

Value of output

If Whr Consumption 38%

97%

ISIS

IS20

The increased consumption of electric power in the lumber industry,
indicated by Fig. 29, is due to its more extensive use for operations
which were previously performed manually. The increased use of
electric power has obviated the necessity of taking on additional
employes, even in the face of increased production requirements.

going on at an increasing rate ever since. This shows
very conclusively that the future development of this
state in agriculture depends upon the development of
these hydroelectric resources.

[Page Thirty-one]

Story" §f California

IftlNflO INpfflffi

136%

Ptrctnt increase in i/y/t/e

f output and ff\v hr • no°/o

onsumption- lSiO-/$ts-/S20 H

143

100%

OO'lo

H 113 'Jo

Vdlutof output.

tfrthr. Consumption

1310

Fig. 30 indicates a more intensive electrification in the mining field.
Despite the slump in mining activities indicated by the 1920 output
figures, the use of electricity in the mines reporting had materially
increased. The fact that the number of men employed had de-
creased at a greater rate than the output is a confirmation of the
greater use of electrically operated machinery in the individual
mine.

Ft/MWAfc ///

ACRES IRRIGATED

I9ZO

IZ8,/*3//.f>

SOO.OOOHF

1-37,300,000 XM

Off
£17 KM tfffS. PER dcfiE.

Fig. 31 shows clearly that almost the entire increase in irrigated
acreage in California has been pumped irrigation. At the present
time more than one-third of all land irrigated in the state is served
with pumped water. 1920 figures on installed horsepower are
based on government estimates — and indicate the tremendous mar-
ket for small motors which has opened up in this field.

[Page Thirty-two]

Electricity's Basic

CHEMICA1 PLAHTS KtWVW

Percent increase m K\tf hr.

Consumption.

1910 • IS IS- 1320

14-00

_ow

270%

\IOO°/o

Fig. 32.

1910 Wil

Increased Use of Power in Chemical Plants Reporting

Charts which show how electricity started and devel-
oped in ten years in various industries are decidedly inter-
esting. In the metal industry in 1910 there was a
hundred per cent product and a hundred per cent use of
electricity ; in 1915 the use of electricity increased to 164
per cent and jumped up to 578 per cent in 1920.

Lumber

Wood.
Products

Food
Products

Leather

Gds Mfy

Fig. 33. Distribution of Isolated Plants

[Page Thirty-three]

Story* gf California

The same thing in the lumber industry. It seemed to
fall up to 1915 but from then on the increase was marked,
and we record the electrification of the lumber industry
as one of the great things which is going to take place in
the northwest in the next decade.

The mining industry; how does electricity help out
the mining industry, which we know is in a slump at the
present time? A steady increase took place through 1915
and even in 1920, when the output fell off, electricity
came to the aid and today is making possible the salvag-
ing of what we can in the mining industry.

The chemical industry, already mentioned, is
another one that has had a wonderful growth during the
past few years, because of the economies and efficiency
possible in the use of -electric power.

/eeo

i/,S

TO P£HC£NT

POPULATION

EL£Y£M

/9OO

/92O

U.S.

laao

1900

BANK CLEARINGS

U.S.

/900

1920

I9OO

1920

Fig. 34. Comparative Growth of Eleven Western States and
United States

[Page Thirty-four]

Electricity's Basic Role

This will give you an idea as to how we are growing
out West as compared with the East. The only thing we
have gone backward in is mining which has experienced
quite a slump at the present time.

U.S.

/88O I9OO I92.Q

1920

Fig. 35. Comparative Growth of Eleven Western States and
United States

[Page Thirty-five]

t3fe Storjr tf California

We sent out four thousand questionnaires to indus-
tries to find out who was serving them and we found out
that our great public servant in the West was serving
practically every one of those four thousand. Only about
fifty were being served by their own individual power
plants and most of those were in the lumber industry or
in the mining industry in some isolated place where public
service stations cannot get to them. Fig. 33, illustrating
this, will give you an idea how broadcast our great public
service industry is here in the West in serving our needs.

GROWTH OF Bis/c /NDusr#/ES
ELECTRIC/TY //v

MEASURED BY THE MLL/E
PRODUCTS, M4NUFACTU/?/NG.
AGRICULTURE wo MW/NG.
1880 TO

Fig. 36 clearly portrays the growth in industrial importance which
California, as typical of the western states in development, has
made. Mining was the major activity of early years, soon supple-
mented and outdistanced by agriculture. From 1880 to the present,
manufacturing activities have shown a growing importance, now
ranking first in the value of output. The past decade has shown
the greatest proportional increase in this field.

You can see by this chart that the development of
California industrially is certainly in a very excellent
shape, so far as government statistics are concerned.

The remarkable growth which the West has made,
in every line of endeavor, would seem to indicate that
electricity is a vitalizing force in our daily life. In popu-

[Page Thirty-six]

Electricity's Basic Role

lation, assessed valuation, bank clearings and business
transactions, farm and factory production and kindred
lines, the increase in the past few decades has been very
impressive. But it remains for the electrical industry
to run far ahead of any other and to pave the way for
the more rapid increases in the dependent industries.

^CREASE 'IN Mft/OVS ELEMENTS
/ND/CATE CALIfOffMA'S GROWTH.

Electric

ftyutetion

Assessed 'Hafoe offt-afterty

Banff C fear ings

Acres /rrtgjfecf

Mumber of factories

Number of Homes

Fig. 37 shows how closely the growth curves of population, assessed
values, manufactured products, acres irrigated and other features
of western development follow the same general curve as the
growth of electrical power output in this region, demonstrating the
close inter-relation of this advance. Figures of per cent increase
show an even more rapid growth in the electrical field, indicating
an even greater use of power per unit of other activities.

In closing, I want to take up one other vital phase of
our life, population, and in doing so to project a look into
the future to see what it holds for us. We very well
know that population and electric power are closely re-
lated, but that while electric power must depend on popu-
lation for an outlet, population is even more dependent
on electric power for growth. In other words, power
must be on the job or available before population can
increase to any great extent.

[Page Thirty-seven]

Story* §f California

California, as one of the largest states, showed the
fastest rate of growth of any in its class during the last
census decade. In view of the possibilities of individual
achievement and community growth in this great empire
in the making, through the benefit of unequalled hydro-
electric resources, this rate should be exceeded in the
next few years to come. But even holding its growth to
the rate at which it is now traveling, California will have,
by 1950, a population of 10,000,000 people.

10,000,000 -T-

TEN

POPULATION CURVE

CALIFORNIA.
J850 TO &5Q.

tfate of increase each fen

7,000.000

-S.000000

1850 I860 1870 #80 1810 1100 /I/O 1120 1130 /9W /ISO

The population curve of California, Fig. 38, shows that there has
been a steady increase in population during each decade. The
growth during the last two ten-year periods has been markedly
faster than for the previous years, and the present rate of increase
of forty-four per cent is not unlikely to be maintained for some
years to come. It is on this basis, therefore, that the above curve
has been computed.

This is a truly marvelous accomplishment, but it will
surely not be attained without the great, widespread
assistance of electricity as a motive power. I urge you to

[Page Thirty-eight]

Electricity's Basic Role

guard jealously the health of this industry. In view of
the possibility of the enactment of laws that would hinder
this wonderful development, I leave with you the same
message that St. Paul gave to the Thessalonians 1900
years ago, ' Therefore, my brothers, let us not sleep as do
others, but let us watch and be thoughtful."

Over 350,000 hp. are to be added to the capacity of western power
companies during 1922, according to schedules announced by the
companies themselves. This peaceful scene is on Hat Creek, Cal-
ifornia, just below the Hat Creek No. 2 power house, part of the
great Pit river development of the Pacific Gas and Electric Com-
pany, now under way. This development will eventually bring in
575,000 hp. which will be transmitted to San Francisco at the record
breaking voltage of 220,000 volts.

[Page Thirty-nine]

Story" §f California

The Future of California Power

BY H. G. BUTLER
Former Power Commissioner, State of California

THE safest — in fact the only way to forecast Califor-
nia conditions is to say that if the factors which have
thus far forced industry ahead remain unchanged, the
future can be foretold mathematically with tolerable
accuracy. The first thing needed is a knowledge of what
the facts are; then an examination of these facts, which
are few and readily analyzed.

From 1913 to 1920 the average horsepower used in
California grew from 301,000 to 549,000, as each year
during the last five years the demand has averaged more
than a 10 per cent increase over that of the previous year.

In 1920 the peak load on the plants of the California
power companies was some 893,000 horsepower, with the
plants in the northern portion of the state carrying a load
which left them no margin of safety whatever. The com-
panies in the south had a slight surplus, but taking the
two together the peak could be met only by using all
available equipment to a much higher degree than is nor-
mally safe in operation. This 893,000 horsepower of
1920, then, can be taken as the maximum peak capacity
of the plants in existence at that time, and the rate of
growth for the past five years — 10 per cent — as the
normal growth.

In the fall of 1920 there were under construction in
the state, plants which would increase the generating
capacity about 386,000 horsepower. By August of this
year, when the peak load period for 1921 is reached, some
190,000 horsepower will have been added to the capacity
available in 1920, and the peak capacity of the intercon-
nected companies will be approximately 1,083,000 horse-
power. Estimating the peak load for this year from the
average increase for the past five years, it will be about
980,000 horsepower. The reserve for the year will be
103,000 horsepower, which means that after all the hydro-
electric power is utilized 356,000 horsepower of steam,
78 per cent of the total steam capacity, will have to be
pressed into service.

[Page Forty]

California Power's Future

Before the peak load of 1922 is reached an additional
capacity of 127,000 horsepower now under construction
will have been added, so a peak load of 1,210,000 horse-
power could be carried, while the estimated peak load will
be 1,084,000 horsepower, a reserve for that year of 126,-
000 horsepower, or 31 per cent of the steam.

GROWTH OF ELECTRIC

STATIONS

IN // WESTERN STXTES.

PR 'i MARY HORSE POWER

INSTALLED //V

CENTRAL

,00,000

Ij800,000

1902

1907

I9IZ

1917 I9ZO

Steady and substantial as has been the development of electric
power generating plants, and particularly those of hydroelectric
power, it has not been fast enough to keep up with the demands
of industry. Notice how great has been the demand on the steam
stations, Fig. 39, during the last few years. With a diminishing
supply of oil available, water power must take over an even
greater share of this rapidly growing load.

By the summer of 1923 one more plant will have
been completed and the figures stand: peak capacity
1,223,000 horsepower; probable peak load 1,200,000 horse-
power; reserve 22,600 horsepower, too small to speak
about.

[Page Forty-one]

Story" §f California

Late in 1923 the Hetch Hetchy plant of 66,000 horse-
power should be completed. The peak capacity of the
state in 1924 will then be 1,289,000 horsepower, while the
peak load will be 1,325,000 horsepower. The generating
capacity will lack 37,000 horsepower of carrying the load.

If the estimate is extended one year further, the peak
will have grown to 1,464,000 horsepower, while the capac-
ity has not increased, and the power plants of the state
will fall 175,000 horsepower short of meeting the demand.

*w —

-tw

fuL

_Lood

#*•

9/iiirt

-U6&

AcVu«.l

A C

«i

MPANllES

lUM
t

-M

•m

m-\

-w

1w n.

isif iaf iw m

Fig. 40 gives in more detail the relative situation of load and cap-
acity, besides projecting the probable requirements a number of
years into the future. The related curves for installed capacity and
maximum possible output are based accurately on the data given
by the fifteen California companies interviewed, and the curve is
carried into the future in line with the announced plans of these
companies. The load curve is made in accordance with what has
been found to be the present situation, namely, a consistent load
increase of 10% yearly. While this increase is very likely to be
greater in the coming years, the 10% increase curve shows what
the power developments will have to be to keep up with it.

[Page Forty-two]

California Power 's Future

These statistics can be summarized thus: In 1925
the 386,000 horsepower which was under construction in
the fall of last year will have been entirely absorbed, and
the resources will be 175,000 horsepower short of require-

ES BASED
GENERATED w /32Q.

An effective way of emphasizing the growth of the hydroelectric
power industry of the West is to graphically compare it with that
of the entire nation, state by state. Fig. 41 shows how the United
States would look if the area of the states were proportioned to
the number of kilowatt-hours generated by water power during
1920. New York, with its nearly completed Niagra Falls develop-
ment is first, but California, just getting well under way in hydro-
electric development, is second and is followed closely by Wash-
ington and Montana. Of the nation as a whole, the section west
from the Eocky Mountains generated nearly 40 per cent of the
total amount.

ments, even if all the steam plants are used to the limit.
In other words, in four years the power companies of the
state, if they are to meet needs in the future as great in
proportion as those they have met in the past, must plan

[Page Forty-three]

Story gf California

for, finance, construct, and place in operation three and
one-third such plants as Caribou, or two and two-thirds
plants of the capacity of Hetch Hetchy.

These figures presuppose perfect interconnections
and a complete utilization of the power available to every
company. If at any time there is to be a local surplus
which is not used, the figures must be correspondingly
increased. Bear in mind that only power plants that are
now actually under construction have been considered,

CAL/FOffNM'5 ELECT ff/CJL

1920.

/NS7XLLA77OMS.

1902

* - <

1=1

<f 08,000,000

ASSESSED faw£

IWZ

Fig. 42 shows that t/ie electrical industry ranks high among the
industries of the West, even when considered solely from the stand-
point of the actual investment involved. Progress figures indicate
a growth which has been more rapid than that of other western
development as reflected in the figures of assessed property values.

and all the larger companies have programs calling for
additional construction in the near future.

Several estimates have been made of the limits to
which California's water power can be economically de-
veloped. Although these estimates have all been based
on the same data, the modifying factors which have been
introduced have resulted in what are practically independ-
ent estimates. The most conservative and reliable esti-

[Page Forty-four]

California Power's Future

mates range from 5,000,000 to 7,000,000 horsepower. It
is probably safe to say that when the state has developed
to the extent of 6,000,000 horsepower, the economic limit
will have been reached.

If the present rate of increase is continued, in 1941,
twenty years from now, this 6,000,000 horsepower will
have been entirely absorbed. Is it any wonder that far-

GROWTH GOES HAND ,« HAND

W/TH /NWSTftML GROWTH, NCAL/FOf?NM.

SOLD

1102

Or /MXtSTffML PRODUCTS' SOLD /?00 (8 /%V.

fMa*u/*ctar,ng, S/ncuffure £ Mmivf)

IWO

Comparison in the growth of sales of the electrical industry com-
pared with all industry in the West, Fig. 43, shows the healthy
condition in this field, which is increasing at a faster rate then
almost any other line of business.

seeing men — men who are familiar with the power situa-
tion and are entirely practical — are already looking
beyond the boundaries of the state for power which can
be developed for use in California as well as in adjacent
states ?

Bearing in mind that if the present rate of growth
continues, there is no use in projecting the power load
beyond the year 1941 without looking to the Colorado
River to the east, the Columbia and the other streams in
Washington and in Oregon to the north, — which means
that we are considering not California but the

«.;. •'-'•' !-> ; !. i -,' >J ,'

[ Page Forty-five]

Story* gf California

West, — it is necessary to analyze the factors which are
now making for growth to see what the prospects are of
maintaining the present rate until the limit of economical
development has been reached.

The main uses of electricity can be roughly classified
as mining, agricultural, manufacturing, transportation,
and domestic. All of these five classes are more or less
interdependent, but all of them are not capable of indefi-
nite expansion.

It is entirely possible that with the working out of
the fields available for gold dredging, the mining load will
be no greater ten years from now than it is today, and it
may even decrease. The use of power in agriculture will
some day reach a limit because neither the new acreage
capable of cultivation nor the water to apply to it is inex-
haustible. But that limit will not be reached in twenty
years, although the rate of increase may be lessened.
With manufacturing, however, there may be said to be no
limit, or if there is a limit, that it is measured by the
power supply. Transportation depends directly upon
population and the product of mines, farms, and manufac-
turing plants. Its use of electricity will grow as they

Year Hydroelectric Steam Total

1910 800,000 277,300 1,077,300

1911 886,910 324,690 1,211,600

1912 943,010 412,220 1,355,230

1S13 1,051,540 467,251 1,618,791

1914 1,175,800 512,870 1,688,670

1915 1,332,430 542,580 1,875,010

1916 1,433,050 545,200 1,978,250

1917 1,566,390 554,680 2,121,070

1918 1,673,350 558,800 2,232,150

1919 1,701,546 619,344 2,320,890

1920 1,826,164 671,586 2,497,750

1921 2,116,500 742,350 2,858,860

1922 2,366,650 823,740 3,190,390

1923

1924

1925

1926

1927

2,728,670 861,330 3,590,000

2,957,900 911,590 3,869,490

3,210,040 943,760 4,153,800

3,352,530 970,570 4,323,100

3,630,280 973,260 4,603,540

1928 3,978,000 978,620 4,956,620

1929 4,177,740 978,620 5,156,360

1930 4,370,770 981,305 5,352,075

Fig. 44 given in tabular form information similar to that given
in chart form in Fig. 39. In addition however, it gives the estim-
ated tables of steam and hydroelectric capacity for each year up
to 1930, based on the proposed developments of the privately
owned public utilities.

[Page Forty-six]

California Power's Future

grow, after it takes the first leap and substitutes the elec-
tric motor for the steam engine — a thing that will cer-
tainly be done within the next few years. Domestic
consumption, which is a function of population, will keep
a step or two in advance of the growth of all industry as

4250,000.000

REAL ESTATE ,ETC.

THE BILLION DOLLAR PROGRAM

$132,500,000

OVERHEAD

SYSTEM

POLES AND

HXTURES

$71,750,000
POWCR'EQUIPMCNT

$56,25O,OOO

LINE TRANSFORMERS
AND DCVICCS

1 5 1,75O,OOO

SUBSTATION EQUIPMENT

441.100,000
STRUCTURES

132,250,000
METERS

$28, 400,OOO
MISCELLANEOUS

What this great construction means to various other industries
is portrayed in Fig. 45. The work which is contemplated during
the present decade will amount in total figures to close to one
billion dollars. To whom this huge sum will go is shown in this
chart.

long as new appliances continue to make power more and
more a necessity in the home.

The ever-increasing cost of the fuels and the uncer-
tainty as to where these mounting costs will stop is strong
enough to compel manufacturers to locate where hydro-
electric power is available.

If this brief analysis is correct, the sequence of
events in the process of building up and growing is, first
the power, then more factories, more transportation, and

[Page Forty-seven]

Story* §f California

more domestic consumers to use it. But the power must
be first. A slump in development — a cessation in the
building of power plants for even one year — will be at
once reflected in a slowing down of the industrial growth

COMPAf?AT/V£ GftOWTH rtGUffES

FOff

MfcsTEftA/ STXTES.

THESE S//OHS HS//JT /9/0 ro /9*O /MS MEANT.

/TE/*f

TOTAL /*/c/re*sE

Investment m£7ectrtcfbwer/nsfa//af/ons

$509,000,000

/8/Z

Installed //.fm Centra! Stations

tf?0,000 //.f

/33Z

Electr/atfgenfrjfed Jy/fyfi/tc (/fi/tf/es

5,100,000,000 KWk

Z357.

Total number of ftowes (fst.)

i20,000 homes

?8Z

Number of //owes £/ecfrifiecf

700, 000 homes

Ftybufaf/on served

£075,000

30Z

fares /rr/feted (&fi forty)

/,330,000 Acres

3?Z

Acres /rrifafetf fy FfrffTfi/ntf (Gfif.wfy)

/ ,050,000 Acres

310Z

Number of fee f ones ojberj//n#

/5JOO

S6Z

f%rjor?s e/nfi/ofetfin factories

335,000

17Z

AnnusI far/?? Crofo Cfst)

-$700.000,000

£007*

Annual ftwfocf ion- jfowfac fanes

*Z,Z50, 000,000

I87Z

Annual M/nersf ftvd/c fro/? fatf&fJ

* 'j7J,000,000

/42%

Totif^nk C/ejr/xfr

*KJS3,000.000

£70 Z

/tssesserf tefae eS/Jtf /=rv/>erf/

?5,8f/, 000,000

NOTE THE INCREASE M/&TE ^LECT^/C/TY HELPS /

The cross section of any community remains practically constant,
changing only with the slow modifications of custom which are
perceptible only from decade to decade. In other words, to meet
the needs of every additional 100 inhabitants in the West, about
the same investment in factories, agricultural development, mining
activity, etc., must be maintained. These factories, farms and
mines must have the electrical power available for their require-
ments— or they cannot be developed. The story of the basic rela-
tionship of electricity to western growth is illustrated by Fig. 46.

[Page Forty-eight]

California Power's Future

of the state. Let there be a failure to develop for several
years, let a power shortage during the summer become
the normal thing rather than the unusual thing, and in-
dustry and agriculture will stand still. If the use of
electric energy has grown at the rate of 10 per cent a year
on a sellers' market, and it has for the past four years,
can any one doubt that it would make even a better show-
ing if there were to be a buyers' market?

1O 50

975

900

300

A2&.

275

600

/so

3JS

/ftO 1912 /9/V 1916 lilt

The population of California as shown in Fig. 47, compared to the
number of consumers in that state over a twenty-year period,
shows that the demand for electricity will not increase in direct
ratio to the population, but at a somewhat greater rate, owing to
the fact that fewer homes will remain unelectrified and a greater
proportion of the farms and factories will use electricity as the
electrical idea continues to spread.

The whole matter can be boiled down to this. The
market will be here. How about the power ? The answer
is that the power will be developed if money can be bor-
rowed to build with. The amount needed at the present
time is something like $32,000,000 per annum. If costs
remain the same it will be larger each year because the
growth is compounding and the more expensive plants
remain to be built.

[Page Forty-nine]

StorjT §f California

Obviously these sums cannot be secured in California
alone. It is essential that money from the East be avail-
able to supplement what can be raised at home. During
the last two years the stocks and bonds of California
power companies have found a market sufficient to permit
the construction of 400,000 horsepower of new capacity,
and they have never been in better standing than they
are today — an indication that investors here and else-
where have confidence that their security is ample and a
fair rate of return will be permitted them.

Recreation sites are one of the beneficial by-products of hydro-
electric development. A delightful summer resort on Huntington
Lake, one of the Southern California Edison Company's projects.

[Page Fifty]

Necessity of Financing

Power Development Requires
Adequate Financing

BY WIGGINTON E. CREED
President, Pacific Gas & Electric Company

IN hearing of the industrial future of this state,
I am reminded of the great shock I experi-
enced in 1900 on returning from the East. It
came from the fact that I had seen the east-
ern skyline dotted with smoke-stacks, the evidence
of industry, and when I reached California I missed
those lofty stacks. But when I came back from the
East last may I could then with satisfaction compare
our skyline with the eastern skyline; I could compare
those smoke-stacks in Indiana Harbor, Gary and the
other great industrial centers which one can see from the
train windows with our great transmission lines which
I saw from one end to the other of the state of California.
There was brought home to me the great progress that
has been made in California as the result of our skyline
being filled with steel towers, transmission lines and our
great network of distribution lines.

The electrical industry has been working a revolu-
tion in California and in the world, a revolution improving
our social and our economic position. This general state-
ment will be full of meaning to you when you reflect that
here in California the electric energy generated last year,
over three billion kilowatt-hours, was the equivalent of
the labor of ten million men for one year, and that the
cost of that energy was less than one-half of one per cent
of a three-dollar-a-day wage. This general statement
will mean more to you when you reflect that in the
country as a whole electric energy saved the consumption
of twenty-five million tons of coal which it would have
required seventy thousand men to mine; it will mean
more to you when you reflect that we are merely on the
threshold of the use of electrical energy in our social life,
and in the home.

Electricity is the most efficient power in the world.
It is bound not only to strengthen and improve our eco-
nomic position, but above all to work wonders for the

[Page Fifty- one]

StoryT §f California

comfort and convenience and safety of mankind. It seems
to me that the electrical industry deserves your confi-
dence as to its ability to carry forward the great work
facing us when you consider its accomplishments. The
electrical industry from 1902 to the end of 1917 reduced

ELECTRICAL US

RELATIVE SIZE OF II -WESTERN STATE*

AND /ILL OTHER STATES, based on Me

P£R CJP/TA PffODUCr/0/V or

§TP?N SlTATES

Fig. 48 tells what shape the state divisions of our nation would
assume if the respective areas were based on the production of
electrical energy per capita. As production is a direct indication
of consumption, we quickly see how much more extensively the
Westerner uses electric power.

the average cost of electric energy more than one-half
what the average cost was in 1902. There was a slight
increase in average cost from 1917 to 1920, but the aver-
age cost at the end of 1920 was one-half of what the
average cost of electric energy was in 1902. There is
today generated about four times as much electric energy
per single employe in the power plant as there was gen-
erated in 1902 — a great tribute to the ability of our
American scientific men and our American engineers.

[Page Fifty-two]

Necessity of Financing

The position of the electrical industry in the West
and the progress which has been made in its development
is best shown by pertinent charts.

The first chart, Fig. 48, is that showing the relative
size of the eleven Western States and the rest of the
country in point of per capita production of electric power.
You will notice how far eastward the boundary line of the
eleven Western States moves in that comparison.

The next chart, Fig. 49, shows the relative size of
the eleven Western States on the basis of the per capita

RELA TIVE S/ZE OF // WEST/ERN STATES
^D ALL gn£8£MIES. ******* a*

Per Cajbit* Production of HrPXO-jELECTR/C POWER

How much greater the Western production of electricity by water
power is than that of the rest of the nation, is shown in Fig. 49.
Nothing more clearly indicates the progressiveness of the public
utilities in utilizing Western power resources.

consumption of hydroelectric power only, eliminating
steam power, and again you will see how far eastward the
line has moved.

The chart following, Fig. 50, is a most interesting
one. It shows the relative size of the eleven Western

[Page Fifty-three]

Story* gf California

States and all other states based on the per capita water
power resources and, you will notice, the line moves even
farther East. The chart illustrates in a graphic way the
point made by Mr. Sibley with his blocks.

ASTERN sr/trss

^.basedon ffie
<RCES.

COLORADO

It has already been said that in the development of a country,
power must come first. Fig. 50 gives us clearly the tremendous
advantage the West has in its March for greater development and
greater industrial importance, based on the undeveloped water
power resources that are now available for utilization.

To some the cost of electricity here in the West looks
large because in 1920 the average cost of electricity to
each inhabitant in the Western States was three and
thirty-four hundredths cents and in all of the other states
it was one and eighty-one hundredths cents. You will
note, by referring to Fig. 51, the significant fact that in
the Western States the number of kilowatt-hours used
per capita was eight hundred ninety-five, and in all the
other states the number of kilowatt-hours used per capita
was only three hundred seventy-two. The difference in
cost per capita is due to volume of use.

[Page Fifty-four]

Necessity of Financing

WHY

ELEC7ft/C B/LL L0O/CED

&/TM.

useo /&? CAPITA.

STATES.

3.3+*

ALL 0THert

STATES.

TOTAL COST /# HfcsT /s /.f T-/#?S AS #uc# AS *v EAST,

SUT £4 77#£S AS MUCH £LECTff/CAL £HERGr IS Uf£D.

Fig. 51 and 52 forcibly refute any claim that Western power com-
panies are making unjustly large profits. The cost to the average
power company consumer of the West per kilowatt-hour is some-
thing like ten per cent less than that prevailing in the next lowest
district and just about half what the inhabitant of New England
must pay for his service.

WHY YOUR ELECT/MC B/LL /§

COMfi4fMT/VELY LOW

COMPANIES

ATLAMT/C MO&TH SOI/TH

SLAND STATES. CCMTKAL Ce^r

STATCS. STATES Sr

[Page Fifty-five]

Story" §f California

The average revenue of the power companies for each
kilowatt-hour produced in the eleven Western States —
these figures being taken from the census report — was
one and thirty-six hundredths cents ; in the New England
States it was two and seven-tenths cents. You will note
that, by Fig. 52, the Western States have the lowest cost
.of any of the groups of states.

The chart following shows that the kilowatt-hours
generated from 1900 to 1920 increased at a much more
rapid rate than our population and is another graphic
illustration of the greater per capita use of electricity in
California and the Western States than in other sections
of the country.

\$
"

7lf

I**

wtmn

»JMI9

n H

2 19

V If

6 ia

8 1*

Fig. 53 gives another set of curves that testify as to the increas-
ingly greater use being made of electric power by the average
Westerner. Such an increase comes because of the fact that elec-
tricity has been found to be an asset in business, a profit maker
in industry and a comfort in the home.

The chart in Fig. 54 shows the growth of kilowatt-
hours generated in relation to the growth of population
in the eleven Western States. I assume some of you will
be interested not only in the prediction as to the kilowatt-
hours generated in 1930 but the prediction on that chart
as to the costume to be worn by women in 1930.

[Page Fifty- six]

Necessity of Financing

GROWTH or/flK/faS. GENEftJTED

w/m GROWTH OF

THE // WESTEffN <S7ZTES.

so.ooo.ooo.ooo

|«

7SKtM*tfti> ISOKH'rtB'r*

/NH4B/T4Nr. /NHtB/rANT.

II OZ

1930.

Fig. 54 carries the story of Fig. 53 pictorially into the next ten
year period. The size of the woman's figure represents the load
of population in the West at the dates specified; the size of the
electric lamp represents the total amounts of electric power pro-
duced in the West in corresponding years. It is easy to see how
much more rapidly the lamp has grown in size than the woman.

The next chart is one of the most significant and
interesting charts that I have seen. It gives the per-
centage of homes electrified in the territory served by
the power companies in the eleven Western States. In
1910, 75% of the homes were electrified; in 1920, 83%
of the homes were electrified. The figures for the rest
of the country are somewhere between 35 and 40% and
the consumption of kilowatt-hours used per home served
has increased in the West from 1910 to 1920 by almost
one hundred kilowatt-hours.

The chart shown in Fig. 56 indicates the certainty of
the growth of the electrical industry in the West. The
white space from the base line to the dark space repre-
sents the amount of hydroelectric power generated and
the black space represents steam generated power. You
will notice what a steady growth there has been despite
earthquakes and fires, financial depressions and other
economic adversities. The black spaces in 1917, '18 and

[Page Fifty-seven]

Story* gf California

-MfcSTERN S&TES.

wo* TZ/f/t/ro/fy or Sewr/tiL TbMs&f G>M/*I///ES
£93,740 HOMES //v /92O.

KW.Hrts. USED

1910

1920

1915

Fig. 55 gives concrete evidence of the previous statements that a
greater use is being made of electricity in the home. Notice that
the use per home has increased close to forty per cent in the ten
years just past. During the same period the number of homes
which were not served by electricity has decreased.

STEAM -ELECTRIC
-POWER

HYDRO-ELECTRIC POWER

1907 1908 1309 1910 1911 1912 1913 1914 1915 1916 1917 1918 1319 1920

The curve shown in Fig. 56 has deep significance to us all in several
ways. In the first place it shows how certainly and steadily the
demand for electric power has grown in California since the public
utilities launched their campaign of greater service to the people.
Most important, however, is the necessity which is shown for
adequate hydroelectric capacity and definite annual increases.
With the supply of fuel oil in more or less uncertainty,
it is obvious that an adequate program of hydroelectric power
development must be encouraged and safeguarded in every way
possible.

[Page Fifty-eight]

Necessity of Financing

'19 are significant. They indicate the effect of our dry
years, and, of course, they indicate also the results of
under-development of the hydroelectric industry.

A prediction as to the per capita production of elec-
tric energy in the West has been made by the chart in
Fig. 57. Two factors are used in plotting these lines;

PRODUCT/OH OF £LEC7ff/C ENERGY

O/WfS CO#rWt/£0 l/P 70 /930 Off B4S/S Of rt?£V/OVS GftOW

QlL/FV/tAfM -WESTERN SBIfiES /HUUDHIC CALIF..

AND ALL Omm STXTZS.

trod

I10Z 1105

nzo

1130

From 1880 to 1920, the Westerner learned to use more electricity
in the home and on his city streets, he demanded more goods made
in factories electrically operated, he consumed more food from
acres electrically irrigated. This increase has been a steady ad-
vance, irrespective of hard times or war depressions. Fig. 57
shows how much the per capita production of electric power will
be in 1930, if only the present rate of increase is maintained. It
is very likely, however, that an even greater increase will be
noticed.

first, the growth of population and, second, the growth
of the per capita consumption. The growth of the popu-
lation in the past has been taken and projected. The
actual growth in the use per capita of electric energy has
been taken and projected. The combination of those two
factors shows that from 1920 to 1930 the per capita
production of electric energy, based upon the record of
the past, will increase from 1085 kw-hr. per capita to
1700 kw-hr. per capita in 1930.

[Page Fifty-nine]

Story" §f California

* 1 1 1 1

CLEAR COLUMN shows H. P. Capacity of Water Power 5000000
SHADED COLUMN shows H. P. Capacity of Steam Installations 1

FUTURE INSTALLATIONS up to and including 1930, are based on
Power Companies' Estimates

*nnn noo f

(Y\* lrr

[Page Sixty 1

Necessity of Financing

The large chart on page 60 shows the installed
capacity of the power companies and the capacity which
they will have in 1930. These capacities are based upon
a projection of past growth and check in horsepower with
the kilowatt-hour chart previously shown.

The chart following that carries forward the power
companies' figures and estimates, based upon the record
from 1910 to 1920, to show the situation from 1920 to
1930. Taking the period from 1910 to 1920, which is
known, as the measure for the next period, 1920 to 1930,
you will note that California, Nevada and western Ari-
zona will more than double in the generation of electric
power. Nevada and western Arizona are not very impor-
tant in this computation because in California alone about
three billion four hundred million kilowatt-hours were
generated. Thus the line for group one may be taken as
representing substantially California, and you will note
similarity of progress in the eleven Western States.

ELECTfflC/TY

WESTERN STATES.

IN.

usfo f*t>t* ft/Or* /V?O

Fig. 59 gives a set of curves supplementary to Fig. 58, in that it
shows the actual amount of power generated and the estimated
total that will be generated by the capacity shown in Fig. 58.

[Page Sixty-one]

Storjr §f California

BV/LD/NG PROGRAM !

/WESTAfENrS /Af ELECTff/C POWER STSTEMS.

// M/£S T£/?M J7XT£S -*/,00/, 000, 000 TO B£ SPENT M A/£XT /O YEARS.

/V/O -

281,200,000
OIL/FORM* A/FM04 & W£5T£/PM 4fi/ZOSM -*S80,SMtOOO //V

/Z5/r00,000 ^08,000,000

/WESTMENT /N GENEMT/NG PUNTS.

//W£ST£ftH STATES.

//?, 082, 000

CJLIFOffMM

HMooo

272, OSO, OOO

Fig. 60 shows that in order to carry out the electric construction
program outlined by the public service industry of the western
states for the next ten years, over one billion dollars will be needed.
This must come in large or small amounts from the investors of
the country if the work is to be carried out.

The chart shown above I hesitate to use because I
don't agree with the figures. They are based upon in-
vestment at pre-war prices, under conditions as they ex-
isted in 1914. Taking them as a basis for this chart, we
have in 1910 an investment in the electric power systems
in the eleven Western States of two hundred and eighty-
one million; in 1820 the investment is seven hundred and
ninety million dollars, and by 1930 that investment will
be increased to one billion, seven hundred and ninety-one
million dollars. For California, Nevada and Western Ari-
zona the increase from 1920 to 1930 shown is nearly six
hundred million dollars. My own view is that this figure
is too low for those three states and is an exceedingly
conservative for California alone.

Chart No. 61 supports what Mr. Butler and Mr.
Sibley have said. It indicates the amount of power which
has come from the coal and coke up to 1920 ; the amount
of power which has come from petroleum up to 1920, and
the amount of power which has come from hydroelectric

[Page Sixty-two]

Necessity of Financing

4,000.000

3,000.000

2.00O.OOO

1.000, 0 00

SOURCE OF POWER LIGHT &HEAT IN
CALIFORNIA — WASHINGTON

The U. S. Fuel Administration prepared the chart shown in Fig. 61
to show how small a part of the burden of power, light, and heat
for the Pacific Coast states is borne by coal and that oil must be
expected to fall off during the next few years, leaving hydroelectric
power to bear the burden.

sources up to 1920. The demand in 1930, which is esti-
mated to be thirteen million five hundred thousand horse-
power years, is to be met by allowing petroleum a slight
increase in the development of power in the next ten
years and a slight increase for coal and coke in the next
ten years. But even with these slight increases for
petroleum, coal and coke, the construction programs of
the power companies as now announced are not large
enough to meet the estimated demand in 1930. On the
basis of this computation, there will be a shortage of one
million five hundred thousand horsepower years in 1930
unless a greater burden is thrown upon petroleum, coal
and coke, or unless the programs of the power companies
are increased. These programs of course are not final.
They naturally will synchronize with conditions as they
arise, but the chart does significantly call to your atten-
tion the conservatism of the programs of these companies
and the possibility that there will be even greater de-
mands upon the companies than those that have been
outlined. In that connection I cannot refrain from say-

[Page Sixty-three]

Igfe Story §f California

ing that the programs of the power companies are based
upon a continuation in the next ten years of the rate of
growth of the. past ten years. I think conditions here
are such that that growth is going to be much greater
than that. I believe that before ten years are over the
steam railroads of this state will no longer be using oil
because I believe the oil industry cannot permanently

1920 CdNSUMPT/OM

1920 CONSUMPTION.

CALIFORNIA
PfiOD(/Cr
/OSJ00.0003U,

CALIFORNIA USES MER OWN Q/L
AND A LITTLE B/r MORE.

By electrificstiox Me life of oar

can

References have been already made to the part which oil plays
in the generation of electric power in California. Fig. 62 gives
graphically the situation regarding oil and its use by various parts
of our complex industrial system.

carry the burden of the railroads and all the other bur-
dens which it must carry. Whether it will be electrifica-
tion or something else I don't know, but I do feel that oil
will not be used as the means of power for railroad trans-
portation in another ten years in California. If the bur-
den of railroad transportation is thrown upon the power
companies, it means of course that even greater programs
must be carried out than are now contemplated.

[Page Sixty-four]

Necessity of Financing

Over and above the future power for railroads, there
are many new uses for electricity which are not factors
in the past increase. There are in the state of California
today, without any doubt, a billion tons of high grade
iron ore. I know that ore will not remain unused in the
ground for a great many years longer and I do believe
that with the developments that are going on in the steel
industry and in the electrical industry, there will event-

U.5. OIL INDUSTRY

PETROLEUM CONSUMED
IN US. . IN MO.
53 1, 186, 000

OIL REMAINING IN THE GROUND
U.S. PROVEN TtESEftVE = 5,000,000,000

CAL. PROVEN RESERVE = 2,400,000,000 &>/*.

Nor can any hope be held out for assistance in supplying oil from
points outside of California, as shown by Fig. 63. The shortage
throughout the nation is as serious, in relation to the general
situation, as is the shortage in California.

ually be built up in California a great steel industry sup-
ported by our iron ore and our electric power. If this
development comes about, then the programs which we
have before us will prove inadequate. This situation does
give a justification for the vision of those men who have
conceived the Colorado River Project; it does justify the
most serious consideration being given to that project
and I personally regard the work of those men who have

[ Page Sixty-five]

StorjT §f California

gone forward to study that project as a great contribu-
tion to the future of this state.

You will notice that California is today consuming
more oil than it produces; that of the oil produced by
California, the railroads are consuming a greater propor-
tion than any other class of consumers.

If we turn to the petroleum consumed in the whole
country, we find that the country is consuming more oil

L/TTLE MLOM4TT OUTGROWS MS BOTTLE.

M KWfa. OarrvTM CALIFORNIA is INDEPENDENT or
O/L CONSUMED IN GENERATION . MITER Form /s

ft£Sf>ONS/BLE FOff THE GftOHTH- A/OT /*/<T/.

mo.

150.000.000 IJSO.OOO.OO&KWhr JS/tOOO

Fig. 64 shows how the public utilities are becoming less and less
dependent upon oil in the generation of electric power. The rela-
tion of the annual consumption of electric power in California to
the amount of oil consumed by the electrical industry in that state
is here graphically presented, the area of the child and that of the
bottle corresponding relatively to these factors. "Little Kilowatt"
has already begun to take to a more concentrated water diet — and
is likely to use less and less oil for the future. It is upon water
power development that he must depend for his future growth.

than it is producing. The outstanding feature in the oil
industry today is that it has assumed or has had thrust
upon it, burdens beyond its capacity to carry perma-
nently.

The chart of Fig. 64 shows the growth of the elec-
trical industry in its relation to oil consumed for power.
You will notice how much more rapidly the kilowatt-hour

[Page Sixty-six]

Necessity of Financing

PRIMARY POWER R

Fig. 65 gives the surest evidence of the growth of the West as an
industrial section, as it is here only that inexhaustible power
resources are available. Water power will not diminish as the
years go by, but will be able to produce more and more electricity
because of greater efficiencies which the machinery manufacturers
will be able to attain.

output has grown than the consumption of oil. Our
dependence on oil must continue to decrease in the future,
if we are to have here the adequate supply of power
which our civilization demands.

The chart given here shows the primary sources of
the United States. The significant feature about it is
the depiction of petroleum and coal as power sources for
the East, and the unending flow of water for the West.
As the sources of power in the East are used up, they
will become more and more expensive. The industrial
movement, of necessity, therefore, must be westward to
the supply of water power.

Now I want to say a few words about financing these
construction programs. I am by no means satisfied that
the programs outlined are adequate for the next ten
years. I am very deeply sensible of the fact that there
may come and probably will come new uses for power
which will cause the men in the power industry to create
new programs of construction. The industry as a whole

[Page Sixty-seven]

Story gf California

represents today a very considerable investment, some-
thing like two billion dollars in bonds and nearly two bil-
lion dollars in stocks. That investment has grown up
since 1902 from a very few millions of dollars investment
in bonds to the enormous investment of nearly four bil-
lions of dollars in bonds and stocks. The Electrical World
has estimated that in the next five years the industry as
a whole will need some three billions of dollars to meet
the demands for new generating plants, transmission
lines and distribution systems. In California a most
conservative estimate of our needs in the next ten years
is from six to eight hundred millions of dollars to meet
what may be regarded as the normal growth in the de-
mand for electric energy. These figures will indicate to
you the importance of the job of financing the needs of
the industry.

By financing we mean securing new money to build
new generating plants, new transmission lines and new
substations and new distribution systems. That money
cannot come out of the revenues of these companies. It is
impossible for it to come out of their revenues. I am
astounded every little while to find the notion in men's
minds that the companies are financing out of revenues
and that they can finance out of revenues. It is an utterly
impossible thing. In the first place, the wages of capital
must be distributed. Under our system of regulation we
are allowed to earn our actual out of pocket costs, depre-
ciation, and, in addition, an interest return upon the
capital in the business. Now, the amount allowed for
capital must be distributed to capital, just as the wages
of labor must be distributed to labor.

It may interest you to know that the Pacific Gas &
Electric Company for the year 1920 distributed in wages
in round figures, eleven million dollars, and distributed for
interest, as the wages of capital, five million dollars in
round figures, so that we distributed as the wages of
labor, more than twice the amount we distributed as the
wages of capital. The wages of capital must be paid or
capital will not perform any more than labor will perform
if its wages are not paid. As regulation limits our return
to the wages of capital, we can not finance out of reve-
nues, and, even if there were no regulations, it would still
be impossible to finance out of revenues because it would

[Page Sixty-eight]

Necessity of Financing

be necessary to increase rates very materially in order to
secure revenue enough to finance these companies. That
is, for every dollar of increased gross revenues which we
receive, we must invest in the industry from four to five
dollars of new capital. To put it another way: if our
gross revenue increases a hundred thousand dollars, it
means that we have invested a half a million dollars in

/9/3

TTH

1914 19/5 19/6

Fig. 66 shows the effect of a shortage on the price of oil. Up until
1915, the possibility of California oil giving out was not given
serious consideration. With the rapidly increasing demand of the
past few years, however, the oil industry has begun to take count
of stock. The result has been a price increase which brought 1920
prices to three times their pre-war level. The improvement in the
purchasing value of the dollar over post-war conditions has brought
this figure down somewhat, but the slight reduction only serves
to show that the increase is an actual one and not a mere feature
of the currency inflation.

[Page Sixty-nine]

Story" §f California

new plants, extensions or what not, in order to get that
hundred thousand dollars of revenue. So that to attempt
financing out of revenues would throw an economic bur-
den upon consumers which they could not carry.

One of the important factors in the increased con-
sumption of electricity in the West over the eastern sec-
tions of the country has been its low cost. The men in
this industry recognize the necessity for keeping costs
down in this state as low as safety will permit. We are
faced in this financing, not with the problem of increas-
ing rates, but with the problem of securing new money,
persuading new money to come into the industry. I want
to make this thought very plain to you, that no matter
how eloquently Mr. Sibley or Mr. Miller may paint the
necessities of the future, no matter how movingly the
people of California and the world may be shown what
electrical development means to the West, such argu-
ments will not bring the money. The investor is not
moved at all by sentiment.

The investor insists upon certain definite things. He
insists upon the safety of his investment and that is the
controlling factor. When you go to secure money you
must be able to show that the investment is intrinsically
sound; that the interest will be paid regularly and con-
tinuously; and that the investment in whatever form it
be, has reasonable convertibility.

We must, in our power industry and in every other
industry in California which needs financing, be able to
meet those requirements. How are we going to meet
them? Well, in the public service industry in California
we are in a most advantageous situation. We have, as I
believe, definitely established here the principle of state
regulation. The recent legislative investigation which
grew out of an attack upon state regulation seems to me
to have resulted in permanently establishing the principle
of state regulation in the state of California. If the state
of California had run amuck and had gone back to local
regulation, the power programs which are now before you
would never have been undertaken. They would not have
moved forward one minute because local regulation would
have destroyed the credit of the companies so far as
future developments were concerned. It is a gratifying
thing to those of us who have this burden of financing

[Page Seventy]

Necessity of Financing

to know that California seems to be permanently com-
mitted to the principle of state-wide regulation by com-
petent experts. We have a greater fortune or as great
a fortune in this, that our State Railroad Commission
has thought soundly upon this question of regulation.
It has not had the conception that it represented solely

POWER L/GHTw MEAT* WESTERN SfflES.

ELECTRICITY, O/L /tw CML £Xf>/?£5S£D /N///?)fai/?s.

Tomake /3,500,OOOH PYrs ^

4,700,000 H friars of f/ecfrictf/- arus
TM3 trtfl rffuire 7,e5O.OOOHP znstet/ecf c

tf fitgn/s tn /93O,assumi"* f>? r*.*^,
The fbver Co>ry!&n1es ffa

S.3SO.OOO XF

15,000,000

I1ZO

The shortage of power which can be expected unless the complete
program of hydroelectric development is put through is shown by
Fig. 67. By converting annual coal and oil consumption figures
of the West into horsepower-years, on the basis of 5 tons of coal
or 20 barrels of oil per installed hp., and projecting these curves
into the future, it is obvious that even the billion-dollar program
of the public service industry for the next ten years is likely to
fall short. A sixty per cent load factor is assumed for electric
power.

the consumer who wanted a reduction in his bills; nor
that it represented solely the company that wanted an
increase in its rates. It has seemed to me to have been
moved by a sense of its responsibility to the state and
the people as a whole, by a consideration and knowledge
of the public interest.

The investor to whom we appeal wants to know what
the state policy of regulation is; he wants to know
whether his investment is to be permanently protected;

[Page Seventy-one]

Story* §f California

he wants to know whether or not, after he is invited and
encouraged to come into the public service industry of
California, the policy of protecting his investment will
continue. The result of the legislative investigation has
great significance in financing the power companies. The
investor is not going to come in unless he believes our
past policy is permanent, — that the state will be fair and
square with him when he comes into the industries of
this state and furnishes the capital to build up the state.
The conclusions of the legislative committee regarding
state regulation are assuring and satisfactory.

And one other thing the investor is interested in,
and that is the attitude of government toward industry.
This is a national issue as well as a state issue. The
national government is - proceeding intelligently, but I
want to say here just as I said in Sacramento, that the
greatest economic crime any state government can com-
mit is to indulge in the kind of economic thinking our
state government has been following. The total appro-
priations for the next two years which have been checked
by the Comptroller to date, — they are not all in — amount
to $91,120,000. Two years ago the state budget was
forty-seven million, the appropriations five million, a
total tax bill of $52,000,000. Our state government in
times like these when the very economic heavens cry out
not to do it, has sanctioned total appropriations of more
than ninety-one million dollars for the next two years.
The estimated revenue available for the same period is
eighty-three million dollars plus an accumulated surplus
of six million dollars, so that there is a constructive
deficit of a little over two million dollars today. This
thing has been done, ladies and gentlemen, at a time when
economy is being practiced by every sound, sane thinking
man in the state of California. I make no apology for
criticising. I am not in politics and no company I am
connected with ever will be in politics, but I will continue
to assert and exercise my right to say what I think of
that sort of public policy and to tell the people of this
state the economic crime committed against them by that
sort of governmental action.

Finally, I want to leave with you just this thought:
that we must realize here in California how inter-related
we are in all our pursuits ; we must realize that whatever
helps agriculture, is helping industry; that whatever

[Page Seventy-two]

Necessity of Financing1

helps industry is helping banking, etc. We must above
all realize that in the vanguard of our development must
go not only the power companies, but all the public serv-
ice companies, because it is an economic fact that our
general development cannot exceed the development of

POWER

SOURCE & £JLECT/?/c/rr.

Cos r or

100%

COST OFltfrrEf? PbivE/f £L£CT7f/cjry.

The natural result of an increasing price of crude oil for fuel is an
increase in the cost of electric power generated by steam driven
machines. With water power, however, little increase will take
place in the cost of electricity generated by hydraulically driven
machines. In the old days of cheap oil, the initial cost of a water
power plant was so much greater than that of a steam plant that
it was often found more economical to pay for fuel than to pay
the interest on the larger investment. That day has passed, as is
clearly shown by the estimates of comparative cost submitted by
California companies. Water power is the fuel of the future, as
Fig. 68 shows.

the public service industry. You can have in the banks
all the money that you can conceive of, you can have all
the credit facilities that you can conceive of, but if your
public service industry is under-developed and unprepared
to meet the public need, growth will be stifled. This con-
ception of the public service industry as the vanguard of
growth and development must be brought home to our
people. They must see that great economic truth; they

[Page Seventy-three]

Story gf California

must understand it and they must feel it, and we on our
part in the business must deserve the cooperation which
we ask. We must be like a university president; we
must have a great deal of faith and we must have a great
deal of patience— faith that our educational work will
bear results, patience to await those results.

THE ELECTRIC PUBLIC SERVICE INDUSTRY OF THE WEST IN 1920

Total investment
Employes _
Annual payroll

Calif.

$567,102,093
21,178
$ 28,293,964

Northwest 1

1
$248,525,642
5,909
$ 10,005,740

^ntermountain
md Southwest

$360,842,453
3,840
$ 5,680,3%

* Estimate 11
Western States

$1,318,000,000
34,200
$ 48,300,000

Annual taxes
No. consumers

$ 5,035,631
780,691

$ 2,155,595
323,895

$ 2,242,771
255,366

$ 10,200,000
1,485,000

Connected load, hp.

2,603,682

986,847

1,217,244

5,330,000

Installed capacity, hp.

Wate

Stear

Total
Kw-hr.
Miles o
Fuels used:

Coal — tons

Oil— bbl.

Gas — cu. ft. .

power plants-
plants

783,727
422,683

449,000
138,000

591,000
111,000

1,861,000
759,900

1,206,410

585,000

702,000

2,515,000

generated
wire

3,648,955,316
116,585

1,450,463,882
39,769

2,194,680,082
50,300

7,970,862,000
226,000

4,991,599
2,800,000

43,472
166,779

224,299
0

706,419
6,339,574
3,042,007

*Based on U. S. Geological .Survey Figures for 1920.

[Page Seventy-four]

Outstanding National Features

Outstanding Features of the
National Situation

BY R. H. BALLARD

Vice-President and General Manager, Southern California Edison Company

BEFORE reviewing the story of western development,
I thought it would be easy to speak on the subject
assigned to me on this program, but as I sat here
through such a wonderful program I heard my National
features all explained by the preceding speakers. I am
forced, therefore, to the conclusion that there isn't much
nationally by way of principle that is not already under
way here in California.

One of the features of the recent N. E. L. A. Conven-
tion was presented by Mr. Samuel Insull of Chicago, and it
was the subject of building large central generating sta-
tions and inter-connecting transmission lines. There was
shown a very considerable inter-connected system all
through the Mississippi Valley, but reference was made
in very flattering terms to the inter-connections on the
Pacific Coast.

Then was taken up the question of the proposed
superpower system on the Atlantic Coast. During the
discussion it developed that the only thing new concern-
ing this superpower system was its name. It developed
that morning when the general subject of large gener-
ating stations and inter-connected systems was under
discussion, that the business that we are now engaged in
has grown to such a point and advanced in an engineering
way to such a degree, that we are forced way beyond the
boundaries of municipalities, of companies and of states
themselves; that the economic situation demands that
these systems traverse the country just in the same man-
ner as the transcontinental railroads do. With the ad-
vance in electrical transmission at higher and higher
voltages and at longer and longer distances, we can
visualize transmission systems several times the length
and size of those now existent in California. There was
also developed the point that in some of the Eastern sec-
tions of the country the laws are so inadequate as to pro-
hibit the transmission of electric energy from one state

[Page Seventy-five]

Story* §f California

Fig. 69. — Marble Canyon Damsite on the Colorado River
where the Southern California Edison Comany proposes to build
a 500-foot dam which will impound forty million acre-feet of water
in an artificial lake over two hundred miles in length, with a pos-
sible development of two and one-half million horsepower. The
project outlined by the Southern California Edison Company in
its application now before the Federal Water Power Board, sug-
gests the carrying out of this great undertaking as a cooperative
enterprise, together with such other power companies as may wish
to participate, construction work to be done at cost under supervis-
ion of the government, with the interests of flood control, irrigation
and power needs alike conserved.

[Page Seventy-six]

Outstanding National Features

to another and it is for that reason more than any other
that the great superpower scheme has been evolved. One
of the first things they must do is to have some changes
in those laws. We were told there that that is the only
reason why any governmental assistance has been asked
for the superpower plan, which was definitely outlined
as a plan for private ownership under state and public
regulation.

We have a lot of power yet to develop in California
if we are going to keep pace with even the normal de-
mand which has been outlined here today. The plan for
the development of the Colorado River in addition to and
supplementing the development within the state of Cal-
ifornia, seems to me to be directly in line with that fun-
damental principle or outstanding feature to which I have
referred and which was discussed at Chicago. The Col-
orado River power will create a reservoir holding some
forty million acre feet of water. Mr. Sibley referred to
the largest reservoir in the world in one of his charts at
present existent, some three and a half million acre feet.
The Colorado River storage reservoir, therefore, will be
ten times as great as that largest reservoir referred to,
which was to take a million men drinking a quart of water
a day the time since Noah to consume. It would take ten
million people performing the same service over the same
length of time to drain the Colorado reservoir.

In the matter of oil consumption the power which
may be developed from the Colorado River will substitute
for ninety million barrels annually and that very closely
approximates the total oil production of the entire state
of California. Incident to the development, water may be
placed upon some two and a half million additional acres
of land which now are practically desert and non-produc-
tive and some three hundred miles of river will be made
navigable. We could go on counting up and up the in-
creased values and economic wealth, but the more we say
about it the more we all realize that it is a project which
will require the most earnest cooperation, support and
enthusiasm of every company in California and in the six
other states involved, as well as that of every man and
woman in our industry and the people at large.

Another feature touched on at Chicago was the mat-
ter of finance and the question of selling stock. It was re-

[Page Seventy-seven]

Story" §f California

ported there that a canvass of some forty companies in
the United States showed a little over a billion shares
of stock to have been sold to the public so far. The num-
ber of stockholder consumers now reported by those forty
companies in the United States was about one and a half
per cent as compared with population served. I know you
will all be glad to learn that the credit for the starting
of this stock selling plan of interesting the public in the
territories served directly as partners, was credited to the
Pacific Gas & Electric of San Francisco, as they were the

30000

25000

30,500

£. lecfric Service Companies

Electric Railways

Electrified Heavy Traction Railroad

lopoo

5000

1910 1911 191Z 1913 1914 1915 1916 1917 1918 1919 1925 1930

Fig. 70. — Past and Future Estimated Growth of Energy in the
Atlantic Super-power Zone.

first Company in the United States, or for that matter
in the world, to start the plan.

Another feature brought out was that of cooperation
within the industry and cooperation of the industry as
a collective unit and as individuals with the general public.

I predict, because of the work that has been done in
California along this line, that within a very few years
no one connected with the electrical industry anywhere
in the United States will feel that he is really in the in-
dustry unless he is honestly and earnestly cooperating
with every other member or branch of it.

[Page Seventy-eight]

Interest to Every Citizen

Why Every Citizen is Interested

BY A. EMORY WISHON
General Manager, San Joaquin Light and Power Corporation

WE electrical men are in the electrical industry
because it is our industry and we are proud of it,
because it is probably the greatest industry in the
world today and it is the basic industry upon which every
other industry and development depends.

Let me mention a few figures at the start. There is
64,800,000 horsepower of developed and undeveloped
water power in the United States. Of that amount, the
estimate for California varies from six million horsepower
to nine million horsepower and I am optimistic enough to
call it nine million. There has been approximately one
million horsepower developed in this state so that we have
nine times the possibilities that we have already accom-
plished for all lands, minerals, timber and in fact every-
hting that goes to make a great industrial West.

Now, the electrical industry in California anticipates
a development in that state of seven million horsepower,
and development requires financing. In order to finance
we must have a protected investment and a fair rate of
return. In order that we may have these we must have
fearless legislation. Legislation represents the opinion
of the voter, and properly should. Therefore I say to you
that the greatest problem that faces the electrical indus-
try today is the problem of having the public understand
what the electrical industry is doing for the individual
and for the public in general.

What part does electricity play in our everyday life?
Picture the world of today and then take from that world
the electrical development of the last thirty years — what
have you left ? A world without adequate communication,
without adequate transportation, without electric light or
power — a world without possibilities. Our industry is
that great electrical industry which has made the world
of today possible and upon which communication, trans-
portation, light, heat, and power depend. The trouble is
that the average citizen does not appreciate or understand
these facts. He does not understand the language we

[Page Seventy-nine]

Story* §f California

speak, the electrical terms, or the details of our business,
and the fact that ours is the basic industry must be
driven home to him, as we have tried to drive it home
here today, in the terms of what our development means
to him in dollars and cents. We must show him that
when our business suffers his business suffers and when
we fail to develop he will fail to develop. When he under-
stands that he is affected we will have legislation that
will make the necessary development possible.

$1200,000000 YErY WESTERN MARKETS

Sf'ENT BY TMC ADDITIONAL POPULATION TOBE5EWEDBY TMC EILEXTRICAL CONSTRUCTION PROGRAM

J*t COMPANY. 3. 7, 00 Q 000

CLtCTRICITY 15,000,000

>/ATtR COMPANY J*!oOqOOO

JTRtET CAR COMPANY 2 7. OOO.OOO

RAILROAD COMPANY 2 9, OOO.OO O

#1,200.000000

It is estimated that over two and a half million people will be added
to the population of the West by 1930. This means that western
industries and western agriculture must have grown sufficiently to
support this number of additional people by that time. It is
obvious that the plans for electrical development must go forward
at the same time to make this growth possible. What the money
spent by these 2,600,000 inhabitants will mean to western mer-
chants is presented in Fig. 71, counting $1500 as the average in-
come for a family of three persons.

We who study the problems affecting the develop-
ment of the West know that the West can not develop
ahead of her hydroelectric resources. If more factories
are to be built in the West more power must be available ;
if farm lands are to be developed and agriculture ex-
tended, there must be more power; and any individual
or political party that delays such development delays the

[Page Eighty]

Interest to Every Citizen

development of the state of California. This means a
delay in the different lines of industry, a loss in payrolls
and a loss in income to every business in the state of
California. To get that story over is the biggest problem
before the electrical industry today.

California contemplates a program of hydroelectric
construction which will amount to one billion dollars in

Though the billion dollars which will be required for the present
building program of the public utilities selling electrical service
will largely come from outside the state, much of it will be spent
in the state. Fig. 72 shows pictorially the percentages of this
huge sum which the various elements of our commercial life will
receive.

[Page Eighty-one]

Story* §f California

the next ten years. Let's see where that billion dollars
goes to. One billion dollars in actual power equipment!
I can not quote figures offhand but I do remember that
7 per cent of that total one billion dollars will be expended
for transformers, and, I ask you, how can we enlist the
help of the man who makes transformers ? How can we
enlist the help of the man who handles the materials that

2 BILLION DOLLARS™ HOMES BY 1930

ONE FEATURE: OF THE: DEVELOPMENT MADE POSSIBLE BY THE ELECTRICAL CONSTRUCTION PROGRAM

r* 1 1,0 00,000,000

Fig. 73 shows the amounts of money the various elements of our
social organization will receive from the two billion which will be
spent for homes. Two homes are built in the city to support the
needs of one farm made possible in the country by electric irriga-
tion. Similarly 20 men must find housing on the average for every
factory which is placed upon the power company lines. These
homes will each need about 400 kw-hr. yearly in electric service,
and the people who live in them will need employment in industries
using electric power.

go to make up transformers, the man who supplies the
copper, the fabrics, and the men who work on the payrolls
of those companies?

I have spoken of the program for the expenditure
of a billion dollars for hydroelectric development to be
spent largely in the state of California, but the greatest
thing of interest is what that billion dollars does in other
lines of development. For instance, figuring on the basis
of our actual census, that is the homes on the basis of

[Page Eighty-two]

Interest to Every Citizen

population, we find that by extending the present curve
to 1930 the West will need two billion dollars to be spent
in homes. We find upon further analysis that in the
average home 47% of the cost goes to labor, and 53% for
material. The lumber interests alone will receive 14% of
this two billion dollars. Is the lumberman interested in
electrical development — in legislation that will make pos-
sible electrical development? Is the carpenter trade that

60,000 customers served;

the employment of 1,300 people in the electrical indus-
try with salaries paid to them of $2,000,000 annually;

the use of 9,000 miles of wire,

and the investment of $37,500,000 in generating plants,

transmission and distribution equipment.

The furnishing of electricity:

for the electrification of 25,000 new homes,
thus serving 100,000 persons;

the operation of 240 miles of electric railways,

representing $27,600,000 of investment,

employing 1,200 persons,

carrying 45,000,000 passengers,

and spending $1,375,000 annually as operating expenses;

and for

the operation of mines and reduction plants,
producing $18,000,000 of minerals annually,
employing 4,000 miners;

the operation of 1,300 factories,

representing $100,000,000 of investment,

employing 27,000 persons,

and producing $140,000,000 worth of goods annually;

the irrigation of 125,000 acres of land,
resulting in the expenditure of $6,250,000 for improve-
ments,

producing annually $9,500,000 worth of crops,
and employing 5,000 farmers and laborers.

Fig. 74.— What 100,000 hp. installed in hydroelectric power plants

means.

[Page Eighty- three]

Story* §f California

receives 15.5% of two billion dollars interested in elec-
trical development? Is electrical development then en-
tirely the problem of the electrical industry, or is it a
problem that affects every individual?

Fig. 74 shows exactly what one hundred thousand
horsepower installed in hydroelectric plants, or one-tenth

1 HP IN THE:

POWER PLANT

I:1S

APPLIED TO

12 ACRES WORTH *30O

4 HP IN MOTORS
ON THE: FARM

PRODUCES

1000 IN CROPS

EVERY YEAR

MAKES

THE LAND WORTH *24OO

Fig. 75 gives figures that were obtained from government reports.
Think what it will mean in increased land value, crop returns and
additional employment, when electric power makes possible the
cultivation of these thousands of additional acres of land — land
that is now lying idle and unproductive.

of our proposed development, will mean in other lines of
industrial development. This is the same hundred thou-
sand horsepower working all the way through. It does
not mean a hundred thousand horsepower for each segre-
gation of this chart, but the same hundred thousand
horsepower which accomplishes all of these things.

The chart on page 84 will give you some idea of what
one horsepower installed in generating capacity in the

[Page Eighty-four]

Interest to Every Citizen

mountains means to the farmer. That one horsepower
will take care of four horsepower in motors on the farm.
This may be considered as an average for the West taken
over a length of time and is possible because the motors
do not all work at the same time. This one horsepower
applied to twelve acres worth $300, makes that land worth
$2400, and enables it to produce $1000 in crops each year.

25 HP INTHE
POWER PLANT

100 HRIN MOTORS

1.57

SUPPLIES

EMPLOYING

33.5 EMPLOYES

PRODUCING

1206,000 ' "COMMODITIES

Fig. 76 is a complementary one to Fig. 75, in that it shows the
results of added industrial activity as more electric power becomes
available.

The next chart will show you what one horsepower
of generating capacity installed in the mountains means
to the industrial phase of our life. Twenty-five horse-
power at the plant in the mountains supplies one hundred
horsepower in motors installed in 1.57 factories. With a
capital investment of $147,000 these factories supply
work for 33.5 employes and produce $206,000 in com-
modities annually.

[Page Eighty-five]

StorjT §f California

Carry this thought home with you — our problem is
your problem. Our development means your develop-
ment and the development of your business. It means
increased payrolls; it means more work for the laboring
man of all classes and trades in the state of California.
Remember also that the politician or political party that
stops hydroelectric development for one year penalizes
the people of the state of California to the extent of
approximately three hundred million dollars annually, and
this figure is based upon actual statistics. We want you
to understand our problem and believe it, because we have
the facts and invite analysis. We want you to come to
our conventions and meetings and study our problems
because they are your problems, and every time you have
the opportunity we want you to tell the electrical story to
your employes all the way down the line; tell them just
what it means to them in dollars and cents. We want you
to help put this story over so that we may be allowed to
continue to play our part in the upbuilding of this great
state of ours; to make it a great leader in all of the
branches of agriculture and industry.

[Page Eighty-six]

Public Policies Outlined

Report of Public Policy Committee,
Pacific Coast Electrical Association

Del Monte, June 10, 1921

BY JOHN A. BRITTON

Vice-President and General Manager,
Pacific Gas and Electric Company, Chairman

WITH the close of the war and normal conditions,
confidence was established for the Pacific Coast
States, and with a certainty of their future, capital
has been obtainable for the construction and development
of the water powers of these states, and it is worthy of
notice that during the past year a total of upwards of
100,000 hp. has been added to the plants theretofore in
existence. With the program of development announced
by the several power companies, it would appear as if in
the next decade at lest 100,000 hp. per annum, or a total
of 100,000 hp., will be added to the hydroelectric power
resources of this state, at a cost for generating plants and
distribution systems in excess of $500,000,000.

Great strides are being made, as have been made in
the past, in overcoming the difficulties of long distance
transmission. Pioneering always in the field of electric
endeavor, Pacific Coast States again promise to set the
unusual mark of transmission lines operating at a poten-
tial of 220,000 volts, making it possible eventually for an
interconnecting bus bar to be maintained from north to
south, so that a chain of power houses, finding their
energy from the eternal snows of the Sierras, may equal-
ize the matter of demand as well as the matter of shifting
the load as between the different parts of the state.

Already the interconnected systems of this Pacific
Coast permit of the transmission of energy from the Ore-
gon line to the Imperial Valley, returning in a northerly
direction from the Imperial Valley to the state of Nevada,
and while not in a position to take care of or insure
supply to meet conditions in all parts of the state, is in
fact a reality that paves the way for a more perfect inter-
connection that is certain to result in the future.

[Page Ei ghty- seven]

Story" §f California

Perhaps the most important thing that has happened
since the war period, has been the recognition by the
public utilities of the necessity for better public relations.
That note is sounded wherever men in the public utility
industry gather for conference; the necessity for it is
urged by all regulatory bodies ; it is now the slogan of the
press, and the far-seeing and wise executive takes public
relations as his text and preaches that gospel not only to
his employes but to the public whenever opportunity
affords. As a matter of fact, executives of all companies,
leaders in public thought, and newspapers of reputation
and prominence are speaking and writing daily Public
Policy Committee reports to the people of the whole
United States. The Public Policy Committee report of
this Section is therefore largely made up of excerpts from
those executives who, having in mind the welfare of their
companies and of their consumers as well, have from time
to time given utterance to their views on this subject.

Mr. A. B. West, vice-president and general manager
of the Southern Sierras Power Company, says:

'"I feel that in a large part our principal problem can
be stated in three words — better public relations. In every
community there exists, and probably always will exist,
some two or three elements which are seeking to drive
out of business — yes, to destroy — the public service cor-
poration.

"On the whole, however, this section is made up of
honest men, and our problem is to get before these people
the facts."

Mr. John D. McKee, president of the California
Oregon Power Company, expresses himself as follows:

"No opportunity should be overlooked of presenting
to the public the truth regarding the utility, emphasizing
especially the financial, physical and engineering prob-
lems, which have to be met and overcome. The company
can give the most efficient service only if it receives the
right kind of support from the community of its users.
Conversely, business activities of the community cannot
develop and prosper to the best advantage unless they
enjoy the benefits of good service. It is to the mutual
interest of the company and the public that the company
give the best possible service and that the public help it
to do so."

[Page Eighty-eight]

Public Policies Outlined

Mr. W. E. Creed, president of the Pacific Gas and
Electric Company, says:

'The public service industry as a whole should adopt
the policy of frankness. Many companies have done so,
but the others should follow. Suspicion feeds upon con-
cealment. Most of the distrust of the industries arises
from things imagined and not from things known. To
the extent that an industry follows these policies it will
find an improvement in its public relations and increasing
cooperation from the public."

In this matter of public relation there can be no suc-
cessful issue or no consummation of the heartiest desire
of those who have the direct interest of the companies
at heart, unless the mass of employes of an organization
becomes imbued with the thoughts and ideas of public
relation and public service so thoroughly, that they are
directly the mouth-pieces of the management in all their
relations with the public. The aim of all departmental
heads should be to bring about the initiative and thought
of a man, and to encourage him, not alone with promises
but with an actual demonstration by recognition in better
position or compensation of his worth to the public utility
and the public which he thereby serves.

The following editorial from Collier's of March 12th,
1921, bears directly on the point:

"Of all the bills that come to you on the first of the
month, which do you pay least willingly? Are not the
two that excite the most distrust the gas bill and the
electric light bill?

"There is an explanation, somewhere, of the lack of
good will shown by the average community toward the
public utility company that serves it with light, heat and
power. One reason, we think, has never been fully stated:
If the power and light companies were owned and con-
trolled by one or two men, and named after people, as
the majority of our big enterprises are, we would be apt
to have a more friendly feeling toward them.

"If you received your electric-light statement from
the 'Smith & Jones Electric Light Company,' and you
thought it too big, you could go down to see Mr. Smith or
Mr. Jones and feel that you had talked to headquarters.
Perhaps Mr. Smith or Mr. Jones would be neighbors of
yours. Perhaps their wives would know yours, or their

[Page Eighty-nine]

Story" §f California

children would go to school with yours. They might
belong to your club, or fish in the same lake, or shoot
over the same marsh, or drive the same kind of automo-
bile that you do. You would have no trouble understand-
ing^ each other."

The consumers of utilities are gradually becoming
more and more an integral part of the development of
electric light and power industry which serves them,
by ownership in the companies through the purchase of
its bonds and stock. The consumer's stock ownership
plan, which found its initiative on the Pacific Coast not
over seven years ago, has extended all over the United
States, and today the effort of the financial men of large
and small organizations has been to place as much of their
securities directly in the. hands of their employes and con-
sumers as it is possible for them to absorb.

The attitude of the public service corporation should
be to not only enlist the investments of consumers, but to
make it their business to see that these investing con-
sumers are given full facts in connection with the opera-
tion and maintenance of the utility of which they are a
part, so that they may be agencies in their communities
to help in establishing a true relation as between the
utility and the public. With that interest fully centered,
it is certain that much of the agitation for municipal
ownership or state control would rapidly disappear.

In this connection it is interesting to quote from that
dean of the electrical industry, Mr. Samuel Insull, who in
an address before the Association of Commerce of Peoria,
111., on March llth, 1921, had this to say:

"Efforts to cripple the public utilities under cover of
the seductive term 'home rule' are self condemned. The
arguments most employed are of no merit and are of
questionable sincerity. We are told the utilities should
be regulated by local municipal authority instead of by a
body of state-wide authority, because under state regu-
lation many of them have been permitted to advance
their rates.

"Who has not advanced his selling prices since the
war period began in 1914 ? Who has not had to do it or
go broke? As a matter of fact utility service rates have
advanced less than any other class of prices, although the
utility companies have had to pay two or three times pre-

[Page Ninety]

Public Policies Outlined

prices for their labor and materials, just like the rest
of you, and today public utility service is relatively
cheaper than anything else we buy — whether for our
business, our amusements, our tables or our backs.

"Add up for yourself the groups of people interested
directly or indirectly in the utility business; consider,
too, that every insurance company, trust company and
bank owns public utility securities ; and that every owner
of an insurance policy or a bank account thus becomes
indirectly interested in utilities. Then you will agree
that Chairman Jackson of the Wisconsin Commission was
right when he said that 49 out of 50 persons picked at
random are financially interested, directly or indirectly,
in 'the growth and stability of this great industry."

The long battle for a Federal Water Power Bill has
at last ended, and the rules and regulations governing the
same have been approved. While not quite up to the
expectations of those who have been fighting for a proper
recognition of the necessity of water power develop-
ments, the clauses of the act are at least sufficiently lib-
eral to permit a trial. The Water Power Act must be
given a fair trial to determine whether the public utilities
can work under it to the advantage of the public as well
as themselves, and your Committee looks for an era of
development such as has not occurred in California for
many years, and it has come at an opportune time — when
the price of oil has made, for economic reasons, a greater
necessity for the development of water power.

It was suggested at the Chicago Convention that to
avoid the necessary delays in regulation caused by the
opposition, usually, of representatives of cities and some
particular class of 'consumers, to applications for in-
creased rates where such increase of rates was warranted
by acute increased costs of labor and material, that Com-
missions in the public interest should consent to a cor-
rection factor schedule, applicable to costs of fuel, and
perhaps also other important cost items. In California
particularly, where within a period of 21/2 years oil has
increased more than 300% in cost, and where the drouth
necessitated great operation of steam units, such a move
would do away with the delays which have occasioned, at
times, losses of very considerable amount to the public
utilities which were not overcome by the adjustment of
rates.

[Page Ninety-one]

Story~ §f California

Generally speaking, Commission regulation during
the past few years has been very thorough and judicial,
and we believe has given greater satisfaction to the pub-
lic and the companies. The decisions of commissions,
like the decisions of the courts, are now being regularly
published and form a part of the Law Library. The de-
cisions of the courts and the decisions of the commissions
are gradually becoming more uniform and judicial as the
subject of regulation is better understood generally.

The Investment Bankers Association of America has
taken an active part, in its annual meetings, in the discus-
sion of affairs of public utilities, and has cooperated with
representatives of the National Electric Light Association
in the needs and requirements of all public utilities. In
common with the public utilities themselves, they recog-
nize the necessity for frankness in public expression and
for the cultivation of public relation and the upbuilding
of the integrity of the investment for service to the
public, and at its recent convention adopted the following
resolution :

'Therefore Be It Resolved, That it is the sense of
the Board of Governors of the Investment Bankers Asso-
ciation of America, that there should be cooperation be-
tween the Investment Bankers and the owners and opera-
tors of public utilities and the regulating officials in laying
before the public full information respecting the vital
importance of permitting and continuing expansion
of all kinds of utility service and encouraging such utility
regulation as will provide sound credit as a basis for
financing to the end that the investing public may provide
the necessary funds by investment in sound public utility
securities."

It would appear to your Committee that the member
companies have a duty to perform, and that is the dis-
semination of proper information among the young men
and women attending public schools and universities.

Technical journals devoted to the cause have, unfor-
tunately, a limited circulation, and the great daily press
only publishes that which is regarded as news and which
will attract subscribers, which in turn moves to the ex-
pansion of its advertising column. Fortunately, there are
some popular journals, such as Collier's Weekly and the
Saturday Evening Post, that are now taking up the public

[Page Ninety-two]

Public Policies Outlined

utility side for the purpose of informing the public gen-
erally of the truth concerning the great service rendered
humanity by the power companies, and on the Pacific
Coast the Journal of Electricity and Western Industry
is doing heroic work.

We believe it to be true that every man interested
in the public utility industry of this country looks for-
ward to the day when his motives will not be misunder-
stood and maligned, and when the great public will have
the same confidence in his expressions as it has in the ex-
pressions of any other merchant with whom it deals for
the necessary commodities of life.

We of the industry realize that the days of profiteer-
ing in public utilities have gone down to the dim and
distant past, and that of all of the businesses of this
great nation, there is none in existence today that serves
the public with a less margin of profit than does the
public utility; it is practically doing business on an eco-
nomical cost basis, earning only sufficient to pay the inter-
est on the money which it must borrow to develop and
carry on its work of service, and laying a sufficient margin
aside to provide for the depreciation on its property
through devotion to public use.

It has been estimated that one horsepower developed
in the state of California enriches the state to the extent
of approximately $50,000, in the creation of new indus-
tries, in additional population, in the building of homes,
and the distribution of wealth among those who help to
build up this great commonwealth. Assuming the devel-
opment of 100,000 horsepower annually by the companies
of this section, it would mean that the material wealth
of this Pacific Coast section would be added to by the
sum of $5,000,000,000 annually, contributed in connection
with the stable increase of power, not for today but for
all time.

To sum up, therefore, let us emphasize the neces-
sity—

for better public relations;

for better care and concern in the welfare of their
employes ;

for better service to their consumers, and for

better interpretation through the public mind of
what their industry means to those immediately served.

[Page Ninety-three]

OT to •*"

O O

CS tN
tN CN

g Sf

OWER CO. Present Ultimate
January, 1920. Date of Capacity Head Capacity
as Co. on No. Fork Feather Type of Prime Mover Completion H. P. Ft. H. P.
irer, 195 miles from San
incisco... ....2-30,000 h. p. Dbl. Overhung
Allis-Chalmers Imp. Wheels.. 5/ 7/21 60,000 1,108 180,000

:LECTRIC co.

January, 1020.
uba Riv., Placer Co., Cal.. 1-1335 h. p. Allis-Chalmers
Turbine 11/1/20 1,340 145 1,340
"reek, Shasta Co., Cal.... 1-15,000 h. p. W-S-M Turbine.. 8/1/21 16,750 216.8 16,750
:reek, Shasta Co., Cal 1-15,000 h. p. W-S-M Turbine. . 10/1/21 16,750 201.3 16,750
le Fork Stanislaus, Tuo-
ine Co 1-9,500 h. p. Single Overhung
Pelton Impulse Wheel 10/1/21 10,050 1,865 10,050

'iver, Shasta Co 2-40,000 h. p. Allis-Chalmers
Single Runner Reaction Tur-
bines 7/1/22 93,800 454 93,800
ne, 1022.
iver, Shasta Co 7 / 1/23 26,800 1 15 26,800
T AND POWER CORPORATION.
January, 1920.
Joaquin River, 40 miles
m Fresno 3-14,200 Kva. Allis-Chalmers
Generators, Francis Vertical
Single Runner Type Turbines 8 /IS /21 54,000 335
iles southeast of Bakers-
d on Kern River 1 Allis-Chalmers Generator,
Francis Type Turbine with
White Hydrocone 8/17/21 12,000 260
les from Fresno on North
1 Middle Forks of Kings
fer:
t« 2 385 162 615

oooooooo ooo o

O\ CO r- 10 O f*5 ^ t- OOO O
iO Tji — CN 10 00 f) CS O 00 tr> O

O O tr> 'O O O >O •* i/j <s r- i/5

OIOPOCS — oo •* \o oo

"•> ID O >O »/> CN IO «*3 00 vO O "-i

•^ oo *o oo ic cs Ov CN 10 o cs ro

f*> W> TJI ro TH — PO CS 00 00 t^ —

'cs'^-TT-T »•<" ^H" —" CN"

<rT cs" o" <rT

CN ^t r*5 CS

tS^ tS CN CN^

-~ ^ ~-~ -^

-"rt • C

:-^ :-5 :

• ii • y

>;! i

*oJ o -"3 "S
53 15 ^

S*|J £••

fcds> fc.

: l^-^-S |
j^*1 co § w a

: sglsl s.

Peart 1 Unit
SOUTHERN CALIFORNIA EDISON COMPANY.
Plants Completed Since January, 1920.
Big Creek No. 2, 3d
Unit 240 miles north of Los Angeles . . Impul
Kern River No. 3 .... 130 miles north of Los Angeles . . 2-22,5
Fra
Big Creek No. 8 240 miles north of Los Angeles . . I. P.
Tur
Work Now Under Way.
Big Creek No. 1, 3d
Unit 240 miles north of Los Angeles . . Impul

: :

t/) CO 73 0

£ •£> Zi •£> 4.

s«n iti ill1 5 IPiJ1 -1 i!3§gg-

ti^ Z^cfi SCKS ^OH ^eu «^ai S ¥55 oow>^

1 iJJJJ * lifli I

y E?i^a i $]»] i it

Hi ill SI li fillj 1 R iii

s issi g 1 ,i I I msi

C3 C C G C

^^D^t:

cs cs cs cs *-

ii
Illlj

Sclis
^alls

§ >

ESS H :

EH :

§H

I 3. :

: S

^ CN

\OfO •

^ 12

' 12 '.

\O Ov O CS

»* :

1000

H ^ :

• «o

: :«i

. ' c

•43

• -H

•

: i

<U • M

i 1

;

S ' "^

: &

2 ! o,

o_ :

a*-]

In •

S * B

oj a;

H |^

: -|

: t! "

£ |

1 if

;'- a

i l!

3 =

oJ ;>

CH !>

i ft

g| j

| £o

2*5

r-i r^

f-H ** ^
§ ^

: gg|

II i

> 1 ^l'-2

§ a -5-5 : :

|J 1

: j|§

IT)

^ OH I-H I-H

P^ P^

<2J cu

! UTH t5

•1—

£"

!>< " £

o :

1 i

<u :|

1 i

c
2

o :
o

o :

Ili i^:

I : :

.g $

r \ t*i O

PQ
J

y :
2 •

Big Creek No. 3, 1st
Unit 240 miles nortl

2d Unit...

Id TTnit

THE SOUTHERN SIERRAS P
Plants Completed Since January,
Adams Auxiliary Owens River . .
Work to Be Begun by June, 1022.
Forest Home Mill Creek
Leevining No. 1 Leevining Crei

CITY OF LOS ANGELES.
Plants Completed Since January,
San Francisquito:
No. 2 50 miles from ]

Franklin Canyon Owens River. .
San Fernando Owens River. .

CITY OF SAN FRANCISCO.
Work Now Under Way.
Moccasin Creek 140 miles from S

IDAHO POWER COMPANY.

Plants Completed Since January,
Thousand Springs
Shoshone Falls

UTAH POWER AND LIGHT C

Plants Completed Since January, .
Oneida Plant Bear River
Work Now Under Way.
Olmsted Plant 50 miles south

WASHINGTON WATER POW
Work Now Under Way.
Spokane Upper Falls

CITY OF SEATTLE.

Plants Completed Since January,

Cedar Riv. Unit No. 5

Worfe TVow f/nder P^oy.
Nehalem Gorge Creek. .

BRITISH COLUMBIA AND Al
Work Now Under Way.
Bull River... ..B.C...

Elk Falls Elko, B. C. . . .

BRITISH COLUMBIA ELECT
Stave Lake
*Preliminary — subject to change.

FOURTEEN DAY USE

RETURN TO DESK FROM WHICH BORROWED

KNGINEERING LIBRAHY

This book is due on the last date stamped below, or
on the date to which renewed.
Renewed books are subject to immediate recall.

DEC9/jV;

£i2432?El''55 uiWJSSSSmi.

Berkeley

YC 33452

785368

Engineering
Library

UNIVERSITY OF CALIFORNIA LIBRARY

Internet Archive Audio

Featured

Top

Images

Featured

Top

Software

Featured

Top

Books

Featured

Top

Video

Featured

Top

Mobile Apps

Browser Extensions

Archive-It Subscription

Save Page Now

Full text of "The story of California, supreme in electrical development, as told to business leaders at the Pacific Coast Industrial Conference held on June 10, 1921, Del Monte, Cal"

See other formats