206 rosa: regulation of natural monopolies 



reduced. This usually in^'olves an appraisal of the company's 

 property' to determine whether the capitaHzation is fair. From 

 time to time the specifications for the quality of the gas and the 

 methods of testing must be revised; the question may arise as to 

 what candlepower or heating value will give the best service under 

 prevailing conditions; new methods of manufacture, new apph- 

 ances and new uses for the gas will all bring up new questions; 

 and the commission must be prepared to consider and decide upon 

 all kinds of scientific, engineering and commercial problems as 

 thej^ arise in connection with the regulation of gas companies. 



These duties are so many and so varied that one might suppose 

 that it would be impossible for a commission to accomplish them 

 all even for a single company, much less for all the gas companies 

 in a state. If it had never been done, it would indeed appear 

 doubtful. But these functions are being performed (at least in 

 large part) so successfully in a few states that many of the other 

 states are looking forward to doing it as soon as their commissions 

 are prepared for the work. The gain from such regulation is not 

 alone to the public, which pays for and uses the gas. The com- 

 pany is saved from unfair and hostile local legislation, which often 

 forces resort to the courts, always an expensive and often unsatis- 

 factory experience. The business is more stable, customers are 

 better served and better satisfied, the credit of the company is 

 often improved, new stock sells more readily and at higher prices, 

 as the public knows the condition of the business and there is 

 less risk to the investor. Stock manipulation is prevented, and 

 those who profit by that process are the only ones to suffer. 



Regulation of an electric light company. Similar duties devolve 

 upon a public service commission with regard to other utilities. 

 Electric light companies are regulated with respect to their sche- 

 dule of rates ; discriminations which are so frequent under ordi- 

 nary circumstances must be prevented; wires, whether overhead 

 or underground, must be run in such manner as to reduce the 

 danger to the public; high potential wires must be especially 

 guarded to keep them from telephone and other low potential 

 wires; alternating current transformers must be grounded on the 

 secondary side, and the grounds must be made according to 



