POWER COSTS.

Auckland Star, Issue LXI, 5 December 1930, Page 7

POWER COSTS.

KING'S WHARF. PLANT. ANNUAL STATE PAYMENT. 7 —- HALF COST OP OVERHEAD. CABINET RATIFIES AGREEMENT.

An agreement has been reached between the Auckland Power Board and the Government concerning the supply of power to the province consequent upon the failure of Arapuni. Cabinet yesterday ratified an arrangement under which an-annual payment will be made by the Government to the board, calculated upon a basis of half the capital charges on the King's wharf station, which, as soon as Arapuni is recommissioned and able to supply the Auckland area, will cease to operate, and will thereafter be regarded as a standby plant incorporated . with the national system of supply in the northern area. The arrangement is the outcome of negotiations which have been proceeding between the board and the Public Works Department and .which, were brought to finality by a visit to Wellington this week of . Mr. W. J. Holdsworth, chairman, and Mr. R. H. Bartley, general manager of the board. On their return to Auckland this morning Messrs. Holdsworth and Bartley expressed satisfaction with the settlement that had been reached.

Prompt Action Commended. In the course of a statement covering Cabinet's decision, the Hon. W. B. Taverner, Minister of Public Works, says that when the supply ceased from Arapuni in June last, the Auckland Power Board with commendable promptitude immediately undertook to increase tho steam plant at King's wharf by the addition of a 15,000 kilowatt set, and the expenditure upon, this unit -wiljL increase the total capital sunk in the plant to approximately £600,000, and it is half the cost of the capital charges upon this sum that the' Government have undertaken to find. "Another matter that has been engaging the attention of those concerned has been the extra cost of generating, power by the steam plant, which was undertaken by the Auckland Power Board; not only for the supply of the needs of their own city, but to some extent to make power available for the area previously supplied from Arapuni,"' the Minister adds. "As some months have now elapsed, an analysis of the figures enabled a basis to be reached on which the Government wiU make a contribution to the board. In making this statement I wish to make it perfectly clear that this should not be construed as being a reimbursement of profits which" the board might otherwise have made if sujfply had been uninterrupted. As a matter of fact, I have been informed by the Auckland Power Board that tho anticipated surplus for the year's /working up to March 31 next was set down at £42,000, whereas the anticipated result will be a deficiency of £35,000. Of this total .difference of £77,000, which is estimated as the total difference in the Power Board's position for the year, it is estimated that the sum of £52,000 is due to the increased cost of generating by steam as compared by .Arapuni supply over a period of 12 months. To the extent that this position has been created by tho increased cost borne .by the board as a result of generating. power by steam, the Government has undertaken to share the extra generating cost jointly with the board."