M.E.D. SURPLUS £225,760

Press, Volume XCIX, Issue 29232, 16 June 1960, Page 12

M.E.D. SURPLUS £225,760

Tariff Changes Approved After reporting that the Municipal Electricity Department had an operating £225,760 for 1959-60, the chairman of the electricity committee (Cr. W. S. Mac Gibbon) recommended to the City Council last evening that tariff changes resulting in £75,000 worth of concessions should be made as soon as possible. The council approved the suggestion without comment. The changes should be spread over all classes of consumers, with preference being given in the first place to commercial consumers and then to industrial consumers, Cr. Mac Gibbon said. Accounts showed that the operating surplus was not directly comparable with those of previous years. Sinking fund and loan repayments were not included, as previously. These items amounted to £49,545.

In his proposals for an adjustment of tariffs, Cr. Mac Gibbon said the majority of commercial consumers benefited substantially by reductions made last year and industrial consumers benefited indirectly by the reduction in the commercial part of their tariff. “In my opinion, both these classes of consumers are still charged a price for electricity relatively high by comparison with the very low domestic rate,” Cr. Mac Gibbon said.

Cr. Mac Gibbon said the operating surplus represented 3.98 per cent, of invested capital, which must be regarded as satisfactory for a public supply undertaking. The trading turnover rose to a new record of £187,543, and the surplus on trading was £10,983, which was 5.85 per cent, of turnover.

The department now had the largest and most up-to-date electrical showroom in New Zealand, and the most modem and wellequipped section for the display of light fittings. Cr. Mac Gibbon said the department owed a special debt to his predecessor as chairman, Cr. L. G. Amos, who consistently recommended to the committee and the staff the great possibilities of retail trade within the industry. He had encouraged a new standard of service to the consumer in the retailing of electrical goods.

£2m Revenue Revenue remained buoyant at £2,369,960, an increase of 6.7 per cent, on the previous year. Capital expenditure was £486.813, an increase of 16.3 per cent. Assets shown in the balance sheet amounted to £5,669,822. Cr. Mac Gibbon showed that each £ of revenue was disbursed as follows: —Bulk power, 12s lOd; capital charges, 2s; working expenses, 3s 3d; surplus, Is lid, with 5d of the last amount being required for loan repayment Sales of electricity during the year increased by approximately 10.5 per cent, but Cr. Mac Gibbon had little expectation that that high rate of increase would be maintained, although the proposed reduction in tariffs should tend to encourage the result. Maximum Demand Commenting on the increase of 4 per cent, in the maximum demand, the general manager of the department (Mr G. H. Battersby) said in his annual report that the increase must be regarded as somewhat less than normal, because it could well be exceeded in any season when the latter part of June and the early part of July had periods of severe cold weather.

Mr Battersby said the favourable balance of £225.760 reflected increased sales of electricity and low average quarterly peaks because of the relatively mild weather and the use of load control equipment. Many improvements had been made in the street lighting of the

city and suburbs, Mr Battersby said. The increase in candlepower 6t street lighting during the year was a record, and the total candlepower of more than two million had doubled in the last 10 years. It had not been possible to extend the underground street main installation in the central area because, delay in the approval of the department’s loan application was reflected in the late arrival of cable. The department had hoped to lay the Gloucester street and Victoria square cable during the 1959-60 Christmas holiday period, when traffic was light. The work would now be done during this year’s Christmas break. When the council adopted Cr. Mac Gibbon’s recommendation, he said detailed sched ’es and recommendations on the new charges would be available tor the next meeting of the committee.