The Press TUESDAY. JUNE 5, 1956. M.E.D. Losses

Press, Volume XCIII, Issue 27986, 5 June 1956, Page 10

The Press TUESDAY. JUNE 5, 1956. M.E.D. Losses

The Christchurch City Council has made no special case for claiming a refund from the State Hydro-electric Department for the revenue losses it has suffered through power! rationing. Every other supply i authority in New Zealand at some' time has had to reduce its off-peak (and therefore profitable) sales of pouter. All authorities drawing; power from the South Island grid I have been in exactly the same position this year and intermittently ini i the past. North Island authorities] •have not been on such short rations I this year, but have suffered these ■revenue losses over a much longer period and more regularly. Even supposing it were possible to calculate exactly what each power authority has theoretically lost since jthe beginning of the war, not much • purpose w’ould be served by refunds | all round, because the State Hydro--electric Department would immedi[ately have to recover this money from the supply authorities. Noone would be much better off, and a great deal of unnecessary accounting would have been done. If the Christchurch City Council has lost proportionately more than some other authorities, it is because the M.E.D. was curiously reluctant to control water-heaters at peak loads. It is still selling some water-heating power at the cheapest retail rate although it buys this power at the dearest rate. Revenue losses last year and this year could have been much reduced if the M.E.D. could have cut w r ater-heaters off at the peaks, on which the bulk charges are based. The policy of the State Hydro-electric Department in charging on peak loads is eminently fair, because the cost of water-generated pow r er is related closely to the maximum demand. The ripple control of Christchurch water-heaters will make possible a much more economic use of power, with benefits :to the State generating system as well as to the M.E.D. finances.

• The City Council has been wise, even if a little late, in equipping itself to control w r ater-heaters. Whether it is as wise in declining to

supply, at the usual retail charges, space heating for new State houses in which gas is used for cooking and w’ater-heating is another matter. The report to the council meeting did not show 7 how 7 this would affect I the council’s peak demand, or whether charges to houses already 'using gas would be raised. On the face of it, the council is restricting its own opportunities for business after electricity supply becomes plentiful with the completion of] Roxburgh. Is the object to discourage the installation of gas equipment in State houses? The matter is probably not as important as it seems. The council’s decision cannot be final until plans for co'ordinating gas and electricity supply in New Zealand have been completed. Almost certainly these plans will limit the present right of electricity supply authorities to fix their charges more or less to suit themselves. The City Council may then have to revise its proposals for space heating in gas-equipped houses.