AKAROA ELECTRIC LIGHT SCHEME.
MR. STARK'S .REPORT.
Mr Stark, Christchurch, Electrical Engineer, visited Akaroa recently and inspected the electric light plant. Thinking that it would be advisable to have the opinion of such a well known expert the Akaroa Borough Council asked Mr Stark to give a report on the scheme, which is as follows :—
"I have yours of February 11, requesting me to give you a few observations relative to your electric lighting plant. Your plant . I understand is in the neighbourhood of a 30 k.w. capacity and cost you' in the. neighbourhood of £6000, of which approximately half is in hydraulic development, the other half in plant and distribution. You are paying interest and actual out of pocket working expenses with a sinking fund of per cent, but you are not providing sufficient depreciation out of the revenue, nor do you allow for making any extensive repairs or necessary fuel expenses in a dry season out of the income, your prices being on such a low scale as not to warrant these. This method of conducting municipal trading in some countries is contrary to law; and is compulsory for the public body operating a trading concern to provide the necessary depreciation fund as well as paying interest and the ordinary maintenance cost, and so to ad just their prices that these can be done. On the other hand I am not a believer in making any set of consumers using a public utility lay aside amounts foi posterity other than that which would naturally accrue by virtue of an appreciating- value of the property: but the extreme that is sometimes taken of making the ratepayer carry the whole burden of a few of the consumers who are benefiting largely by the convenience of the electric power is not right. Your system of making a discount or lower price to shorthour peak load users such as shops is essentially wrong in my opinion. These customers take up space on your plant for a few hours in the year that could be easily utilised by a consumer who would pay the full price for it even if used for longer hours.
You are selling your power to some consumers at much too low a rate; for example, take one consumer who uses 17 k.w. (during possibly only a few hours per day, but you must furnish him the power when he wants it) and you receive only £50 per year as revenue. Now it has been established by the Government prices that £12 to £16 per year is a reasonable charge for
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AKAROA ELECTRIC LIGHT SCHEME., Akaroa Mail and Banks Peninsula Advertiser, Volume LXXV, Issue 3527, 3 March 1916