POLICY AS TO THE ADMISSION OF NEW IES INTO THE FIELD (MASSACHUSETTS) The board, upon application in writing by any company, chartered under the laws of the commonwealth, after notice and hearing, may authorize the company to go into the gas or electric business. It may engage in such business in the territory or any part thereof that the board may designate, but shall not do so unless authorized by a two-thirds vote of the shareholders.
In granting this authority the board shall prescribe the time, not less than six months, within which the company shall erect and equip a plant for carrying on its business, and shall designate the minimum capacity of the plant. If the company fails to erect the plant within the time required, the authority becomes void, and shall not be granted again for two years. No other company or person in the community where a company already exists may lay pipes or erect wires without the consent of the mayor or aldermen or board of selectmen. Any company aggrieved by the decision of the municipal authorities on the coming of a new company, may, within thirty days after notice of such decision, ap peal to the board of gas commissioners, which shall thereupon give notice and hear all par ties concerned. The decision of the board shall be final.
Practically all the cases of such new com panies have come before the board through appeals by the old company from the action of the municipal authorities. One of the first was the Boston Electric Light Company vs. A. W. Perry (1889). Perry had purchased a small, private, electric lighting plant. He moved the apparatus to a block he owned, and from there he ran wires across Summer Street to blocks that he leased. He had ob tained no permit to do this, as he did not know that it was necessary. Later he had asked for one, and, as no remonstrants ap peared, the aldermen had granted it. The company, stating that it had seen no notice of the hearing, showed that the grant from the aldermen allowed Perry to light a valua ble and substantial part of the city. Since he did not possess a general franchise, he did not have to furnish gas upon a reasonable demand as the corporation had to; the cor poration argued that though Perry could, per haps, furnish light to certain sections more cheaply than it could, nevertheless to let the decision turn on this alone was an injustice to the company, which could furnish light to the whole city at a less rate than Perry. The
board agreed with this argument.
The board gave a very full statement of its reasons for protecting the large company in such a case in the hearing on an appeal by the Edison Electric Illuminating Company (1895) from an order of the aldermen permitting 0. H. Durrell to run pipes across the streets. As between corporations and individuals it seems to be a wise policy to entrust the light ing of towns and cities, so far as it requires a public franchise, to perpetual bodies, sub ject to state supervision and regulation, and capable of continuous ownership. Such bod ies serve the community as a whole more safely and economically.
The commission says: The large lighting companies, holding valuable franchises, are compelled to submit to the orders of this board in regard to the quality and prices of light. The large company is required to satisfy all reasonable demands for extension, and in fact to furnish the whole community with light. It is clear that if isolated plants are permitted to exercise public franchises over limited areas in the city, the burden of each company will be en hanced, for such a removal of its customers, as would result from the multiplication of business, would of necessity add to the cost of light to the whole community.
If it were shown that a company rendered in efficient service or charged unreasonable rates, or defied legal restraint, these circumstances might be conclusive in favor of introducing competition. The multiplication of plants, exercising public franchises, and each lighting a limited area of the public territory, would, in the first place, lead to great confusion, and, in the second place, would be detrimental to the general consumer, who must always be dependent upon the large general com panies, and for whom the companies must main tain a sufficient plant and lines.