How Holyoke utilities came to belong to the citizens of Holyoke
The city of Holyoke purchased the water supply from the Holyoke Water Power Company in 1871, and the Gas and Electric system in 1902. They had a vision of water, gas and electric service becoming not luxuries but public utilities, operated by and for the public good, not private profit.
“Recognizing that electricity would provide better and more efficient illumination on its
streets, this forward-looking city began converting its street lamps from gas to electricity. In
1890, the City entered into a contract with the Holyoke Water Power Company to supply its
electricity for the next five years...
As the City neared the end of the original five-year term with the Water Power
Company, it was clear that the market for electricity was growing exponentially. Since there
were no regulatory agencies at the time, nor any other competing power suppliers, the
Holyoke Power Company saw this as an opportunity to impose an enormous rate increase
on the City. The City leaders saw only two options: either submit to being held hostage by
ever-increasing rate hikes which might eventually bankrupt the City coffers, or agree to a
three-year contract, during which time they would construct a plan to manage their own power
company. They chose the latter of the two options, and the first steps of establishing
a municipally-owned power plant were put into motion.
On January 8, 1898, the Holyoke Water Power Company offered to sell both its gas
and electric plants to the City for a price of $1,000,000. This price tag, more than twice what
the City had predicted the two plants were worth, became the catalyst for contentious debate.
Advocates for a municipal plant formed the Municipal Light League, and pointed out that the
Holyoke Water Power had reported to the State Gas & Electric Commission a sworn estimate
of $241,197 as the value of the two plants for the assessors. The dispute eventually ended
up being settled by the Supreme Judicial Court, but not until after a total of 109 hearings had
taken place in Boston and Springfield. The combined value on the plants was determined to
be $706,543; with litigation costs of $103,004.40, it brought the total purchasing price to
$809,547.40. The formal decision was pronounced on November 18, 1902, and the court set
December 15, 1902 as the date the City would acquire the gas and electric plants.”
From HOLYOKE GAS & ELECTRIC DEPARTMENT 1902-2002
The First One Hundred Years compiled by Dave Moore
