Any city of the first class is hereby authorized and empowered, for the purpose of carrying out the provisions of sections 16-684 and 19-2701, to construct, maintain, and operate the necessary rural transmission and distribution lines for a distance of eighteen miles from the corporate limits of such city upon, along, and across any of the public highways of this state under the conditions and provisions prescribed by law for the construction of electric transmission and distribution lines to persons, firms, associations, or corporations. Before the construction of any such rural electric transmission or distribution lines shall be undertaken, such city shall enter into contracts for electric service with persons, firms, associations, or corporations to be served at rates which will produce an annual gross revenue to such city equal to not less than fifteen percent of the cost of such construction. Such city shall thereafter adjust such rates when necessary to produce such gross revenue.