Electricity supplied by a Washington utility often comes from the same plant, travels the same wires, and arrives in the same area -- but the rates charged for it vary sharply, according to a detailed study of what people are actually paying.
The study, conducted over two weeks by The Washington Post and confirmed by the utility companies, showed these differences in the cost for one kilowatt hour, the basic unit for measuring electrical usage:
A small business paid 6 cents; a large business only 3.3 cents.
A small private school paid 6.1 cents; a church 5.2 cents; a big downtown office building 4.5 cents.
Residences also paid different rates -- a house, 4 cents; an all-electric condominium, 3.8 cents; an apartment in a big building, 4.3 cents.
A 4-unit apartment building was charged 4.1 cents while another identical building nearby but with a different type electric meter was charged 6.2 cents.
"It's ridiculous," exclaimed A. K. Lowry, manager of the building that is charged 6.2 cents, when told of the lower rate in the neighboring building.
Lowry's building, located at 2825 Naylor Rd. SE, is part of the 800-unit Naylor Gardens complex and is charged on the higher commercial rate because it has a "master meter" -- one electric meter for each 4-unit building.
Lowry receives the electric bills and pays them, passing through the cost as best he can under the rent control laws.
Around the corner at 2817 28th St. SE, tenants in an identical 4-unit building each receive their own eletric bills because the units are individually metered.
They pay at the lower residential rate.
These examples are taken from real buildings in the District of Columbia. All receive electricity from the Potomac Electric Power Co (Pepco), a government-regulated monopoly serving the District, suburban Maryland and part of Arlington.
Across the river, the giant and financially troubled Virginia Electric and Power Co. (Vepco) also has different rates for different customers.
Senior executives at each utility insist that the varying rates are based on the different costs of serving different kinds of customers.
For example, a small business paid more per kilowatt hour (KWH) than a big business because it bought less electricity.
"It's like buying a box of soap," said Pepco Senior Vice President Paul Dragoumis. "If someone buys a big box, the price per pound is less."
The executives also said that some of the differences are caused by "social decisions" by the government regulatory commissions to shift the burden of rising electricity costs away from residential users and onto business users.
Asked why identical buildings pay rates varying by 51 percent, Dragoumis said that inequities are unavoidable and may be found in any set of rate schedules.
To correct that particular situation, he said, "We would have to have a set of rate schedules that looked like the Encyclopaedia Britannica. You'd have to have a rate for tropical fish stores . . . ."
As it is, a reporter had to take a short course in rate calculation from Pepco and then work with 99 pages of rate schedules to calculate the comparative rates on the chart accompanying this article.
Pepco and Vepco statisticians confirmed that the figures are correct.
While company executives defend the rate schedules, there are equally sophisticated critics who use words like "chaotic" and "irrational" when describing them.
"There aren't clear matchings between earnings and costs, so people don't know when to conserve," said Brian Lederer, the D.C. People's Counsel whose job it is to represent utility customers in rate hearings before the regulatory commission.
Lederer is pushing hard for something called "time-of-day rates" that would make electricity cost less at night and on weekends when its use does not strain Pepco's existing generating capacity.
"Historically, the different classes of customers were developed from logical groups of customers with different types of needs," said U.S. Rep Michael D. Barnes (D-Md), formerly a member of Maryland's utility regulatory commission. "There is increasingly a view among experts that some of those categorizations don't make the same kind of sense today that they did. . .
"In the 1950s, it was believed that it was much cheaper to sell a kilowatt hour to a large customer than to a small one. Today, the argument can be made that the large customer places a higher cost on the utility company because [this brings] a higher demand for scarce resources."
Regulatory commissions here and nationwide are slowly responding to this and not giving discounts for more electricity usage.
William R. Stratton, a former member of the D.C. regulatory commission who is now a utility executive in Texas, said there is a "serious distortion" in the D.C. electric rates because every residential user pays only a minimal amount for the first 450 kilowatt hours.
"You have to look very far to find rationality in this," Stratton said. "It's loading costs on commerical people."
In addition to differences in prices charged different types of customers, prices vary sharply from one jurisdiction to another.
If the D.C. residential house in the Post study were located in Fairfax City, for example, its owner would have paid 7.6 cents per kilowatt hour instead of 4 cents -- 90 percent more.
Pepco's rates in Maryland are higher than in the District because the D.C. regulatory commission has not granted the increases allowed by the Maryland commission.
In Virginia, the regulators have had little choice but to allow Vepco a series of large rate increases because the giant utility -- the nation's 10th largest -- mortgaged its furture in building four big nuclear power stations that have had major mechanical problems.
In addition, the federal Nuclear Regulatory Commission has clamped a moratorium on opening new nuclear plants in the wake of the Three Mile Island accident.
The edict leaves Vepco with a new nuclear station ready to open at North Anna. But instead of producing cheap nuclear power, the station just sits there costing millions in capital costs while Vepco buys up vast quantities of expensive oil to fire up other, older generating plants.
In contrast, Pepco never went the nuclear route and nearly 85 percent of its generating capacity uses coal -- less expensive than oil -- as fuel.
Pepco may be better off than Vepco for the time being, but critics such as Lederer continue to believe that these companies and others across the country remain in the grip of a "chaotic rate design" that to a large extent "doesn't make any sense any more."
Said Lederer: "You get these ridiculous, senseless fights among customer classes about [who's a paying what.] The truth is [the rates are] just all jumbled up."