NEW CHARGES FOR POWER

Press, Volume LXXXIX, Issue 26967, 17 February 1953, Page 8

NEW CHARGES FOR POWER

Joint Protest To Prime Minister CHRISTCHURCH AND WELLINGTON Protests to the Prime Minister (Mr Holland) against the new tariff schedule for the bulk supply of power will be made by a joint deputation from the electricity committee of the Christchurch City Council and the Wellington City Council. Approval of this action was given by the council at its meeting last evening. In his report, the chairman of the committee (Cr. G. Manning) said it was felt that the new schedule was a gross injustice to the larger supply authorities. A special meeting of the council will be held as early as possible to determine the new schedule of charges for the supply of electricity by the Municipal Electricity Department. The electricity committee was asked to bring down the increased charges to the meeting. This action was adopted at the suggestion of Cr. J. E. Tait when it was found that a definite indication of what the new charges would be had to be given to consumers.. The council thus amended a clause in the committee’s report suggesting that an advertisement should be placed in the local newspapers to advise consumers that because of increased charges from the state Hydro-electric Department it was necessary to increase charges to various classes of consumers to the extent of between 50 per cent, and 60 per cent., and that these charges would be included in accounts rendered on and after April I. “Consumers should be aware that the increased cost of electricity m Christchurch is imposed by the Government and not by the City Council,” said Ci*. Manning. He added that m the limited time available since the schedule was received it had not been possible to determine the new tariffs for supply to' the various classes of consumers, nor was this desirable until after the result of the proposed deputation was known. “As far as I am .concerned, and the electricity committee, the domestic consumer is, going to be treated reasonably by the council,” said the Mayor (Mr R. M. Macfarlane, M.P.) during the discussion on the increased charges. “The domestic consumer is not going to be harshly treated.”

Mr Macfarlane said he understood the increase in charges that would have to be passed on to consumers would be approximately 54 per cent. Later in the discussion Cr. Manning referred to figures prepared by departmental officers, and said the increase would be somewhere between 52 per cent, and 54 per cent. Reporting on the negotiations for the new bulk supply contract, Cr. Manning said- that if the supply authorities had been successful in their representations regarding payments to cover depreciation and loan redemption a further 2 per cent, reduction in the total costs submitted by the State Hydro-electric Department would have been possible. Review After Two Years Cr. Manning said it was felt that reliable estimates of costs could now only be made for two years because of the fluctuations in wages and in the cost of importing machinery and equipment. Also, the need to operate fuel plants was difficult to predict so far ahead. The cost basis of the agreements was therefore to be reviewed after two years. The question of depreciation and loan redemption, as somewhat modified from that suggested by the council, had been shelved by the Associate Minister of Finance, who had stated that he was not prepared to introduce the necessary amending legislation during the forthcoming session of Parliament, but would give the matter further consideration in the future.

“The application of the new schedule to this department’s load results in an increase in the cost of bulk power of 67.6 per cent., whereas the previous schedule submitted by the State Hydro-electric Department resulted in an increase of 80 per cent.,” said Cr. Manning. “However, the cost based on this new schedule to the council is only 7.2 per cent, less than the cost based on the schedule previously submitted. although the reduction in the State Hydro-electric Department’s total costs, as agreed upon between the bulk supply comnuttee of the association and the officers of the department, was 16 per cent.”