June, 1932] Electricity on New England Farms 47 



Essential Qualities of Rural Rate Forms. 



The true farm customer represents, from the utility standpoint, a 

 combination of home and business enterprise, both carried on on the 

 same premises and served by one electrical service entrance. Roughly 

 the farm represents a combination of residential and power service — a 

 condition not generally found in other classes of utility business. For 

 this reason it warrants special attention. 



Due to the close proximity of the two parts of this combination it is 

 difficult to distinguish where one ends and the other begins. Dairy 

 utensils may be washed by the housewife in the kitchen. She may 

 also hatch and brood the farm flock of chicks. The man of the house 

 may secure all hot water from the kitchen for stock purposes, etc. 



While a certain amount of the electrical usage is very evidently pure- 

 ly residential, the other part is distinctly a power load. This power 

 load should be given consideration from the standpoint that the cur- 

 rent is to be used in a business, the products of which are largely sold 

 on a wholesale basis. In other words, it appears to be a fair assumption 

 that if a farm sells its products wholesale it should purchase the in- 

 gredients on somewhat the same basis to show reasonable profits and 

 continuity of business. 



From the above it is evident that the farm rate should represent 

 a combination of residential (retail basis) and power (wholesale basis) 

 usage. Here again is the perplexing question of what proportion of 

 each should be incorporated. The answer to this, under present con- 

 ditions, probably could be obtained only through study of power com- 

 pany billings, including a large number of subscribers. From the ex- 

 perience of the experimental group it would be expected that the use 

 of current on the average farm is somewhat equally divided between 

 house and farm operations at present, but it should be borne in mind 

 that the saturation point in the home is fairly definite, whereas the 

 limits of use in farm operations appear now to be many times that of 

 the home. Since large bulk use is desired and necessary to produce 

 the proper return on line investment, as well as to justify lower rate 

 steps, it would seem that a farm rate structure should have a predomi- 

 nant part devoted to the power (wholesale) basis, at least after the 

 initial higher block or blocks in order to induce more liberal use in the 

 field where it can actually take place and needs more stimulation. 



Rates 



Several different forms of rates have been in effect on the experiment- 

 al farms and, as has been stated before, these are not all entirely suited 

 to the agricultural business. For the most part they have been more 

 or less temporary until such time as experience indicated the proper 

 procedure. 



Area Basis. 



One form of rate, more or less common of recent years and known as 

 the area rate, bases the minimum charge and subsequent scale on the 

 square foot of area enclosed in the house and other buildings. Satis- 



