WATER POWER.

Evening Post, Volume LXXX, Issue 3, 4 July 1910, Page 3

WATER POWER.

DEVELOPMENT OF THE RESOURCES, .- ' THE NEW PROPOSALS. SPECULATIVE AND COSTLY. (By Fredk. Black, A.M., Inst., E.E.) During the present session Parliament is to be acked to pass legislation dealing with the water powers of the country. Further development of tnese resources by private enterprise or by local authorities is to be prohibited, the Government is to be authorised to spend half a million a year on hydro-electric undertakings and a new branch of State trading, based upon absolute monopoly and centralisation of control is to be launched. That is, if Parliament agrees. I hope to.be able to show that no more speculative and costly venture could bo undertaken in New Zealand, that in the conditions which prevail in most parts of the country the majority of the water powers are worthless to the present generation and of uncertain value to the next, and that in the case of those which have a present value it is to the best interests of the country that private enterprise should be encouraged, and local authorities of the right standing given every inducement, to develop them._ I am not a politician, and .■write from no political motive^, but having had to professionally study some of the water powers, and being aware oi' the conditions existing in the chief power-consuming districts cf. the Dominion, I hold that the .adoption of the Government proposals will do more ultimately to strangle useful and needed hydro-electric development than could anything else. Since the time when the State vested all the water powers in itself, there has been much talk of their enormous value, and legislation has been passed "conserving" them. Other countries have "" been actively developing their rivers and lakes where they had a commercial value, but New Zealand has bo successfully conserved that to-day it has only one installation serving an industrial market. Another is in the initial stages of construction, and there are about five or six small plants, half of which run a few hours per day to light villages, and are quite innocent 4of power supply. This is the sum total for about ten years' brave talk, glowing reports, and "lead*- the- world" determination. Though the number of water powers reasonably fit for development is not considerable, it is larger than this record would indicate. WHERE IS THE MARKET? The value of a water power is not primarily a matter of the horse power in" it, but of the market available for supply, and the market available is a question of population and the price of coal. Waikaremoana, for example, when harnessed, coulcl furnish from 24,000 to 134,000 horse-power, according to the development chosen. Where is there a market within transmission limits for even half of the smaller power output? The power cannot be exported, it cannot be sent, as a commercial enterprise, to Wellington or Auckland, and the towns near to the lake would be hard put to it if they managed to absorb 3000 horse-power when ten years older than they are now. The belief that hydro- j electric power costs practically nothing lo produce and very little to transmit is widespread, and is largely respon- j sible for the false notions as to the value of the country's water powers. it is seldom realised that hydro-electric undertakings require a much heavier outlay of capital than any other form of power-producing plant, and that on uhis capital interest has to be paid. ■When the interest is a substantial sum, as it invariably is, the charges to the consumer may have to be — unless the market is a largo one — at such a rate that coal-derived power can successfully compete. With a large population there will be industries and a large call for power; it is then simply a question •whether the interest item will be less than tte coal item. I doubt if at the present time 1 per cent, of the people of New Zealand believe that power produced from coal can ever be made or sold cheaper than power from water, yet it is true in many instances. The reasons for this are that the' harnessing of water-power is costly, the distance over which the power must be transmitted is usually sufficient to make the line and plant costly, and when the market is reached it is either too small to take more than a fraction of the power which must be sold to cover interest on the capital expended, or it has a good and fairly cheap coal supply. I know one nydro-electric undertaking in New Zealand, now established for some yeaTS, and generating up to several hundreds of horse-power, the chief engineer of which told me some time ago that although the plant was excellent and the ..ater supply good, yet, if the undertaking had tc be constructed again tomorrow, he would have nothing to do nth water power. He was right, for his system is burdened with a capital out of proportion to its output, due- to the reasons I have mentioned. TWO GREAT OBSTACLES. The two great obstacles to the successful development of the majority of our water powers are the lack of population and the abundance of coal. Wherever hydro-electric undertakings are plentiful there are people to make generous use of them, and either dear coal or no coal at all to compete with them. Though population implies industries and a good power demand cheap power does not qroduco industries unless it is accompanied by certain other favourable conditions. This statement is certain to be scouted as rank heresy, and Niagara will be called on to refute it. It is absolutely true all the same. The cost of power in most manufacturing works is not, as a rule, more than 5 per cent, of the total expenses. There are exceptions, of course, such as cement, quartz milling, lighting and transportation plants, but for the great majority of industries the ' statement holds good. Consequently, a reduction of tho power cost, while alfr ways desirable, is not to be compared in importance with a sufficient labour supply, low rents, cheap land, easy taxation, good transport facilities, and — in some industries — nearness to the raw materials. 'The district round Niagara offers a combination of attractions, of which cheap power is only one. I know New Zealand fairly well, but I know no district that could, even were unlimited power given free, triumph over the hundred and one obstacles that exist to the establishment of real manufacturing industries trading with the world. INSTRUCTIVE FIGURES. The costly nature of hydro-electric undertakings, in all but rare cases, may be judged by a few figures taken from the only report on New Zealand water powers that covers any detailed investigation — I refer to the late Mr. P. S. Hay's report to the Government. In each instance quoted the cheapest of alternative developments is given :—: — Rotoiti-Kaitumt, 5280 h.p., cost £340,000; Huka Falls, 10,000 h.p., cost £300,000; Rangitikei, 30,000 h.p., cost £1,060,000; Tauherenikau, 5000 h.p.,

cost £225,000; Hutt, 5000 and 12,000 h.p., cost £225,000 and £340,000; Lake Coleridge, 17,400 h.p., cost £760,000 ; Lake Monowai, 14,000 h.p., cost £430,000; Lake Hauroto, 80,000 h.p., cost £1,700,000. With the possible exception of IJutfc River and Lake Coleridge, Wellington and Christchurch projects — no market of any kind exists for these schemes, and for the two named a market can only bo won by competition with coal power, in areas where the chief power consumers are already equipped with modern economical steam plant. A surprising feature of the water power reports procured by the Government is that none of them attempt in any way to discover what actual market prospects there are for any scheme. Mr. Hay, it is true, gives statistics of oxisting steam and other installations, but nowhere have I been able to find the slightest indication as to the cost of coal power, the horse power in use, the proportion of continuous demand to short- hour demand, the existing annual consumption, tho rate- of increase in Eower required, and in that likely to c required ; nor has any attempt been made to show at what price hydroelectric power can be offered to the consumer, in any town. These matters are the very elements of a business proposition, and require consideration before half millions of money are voted rather than after they are spent. There are certainly some water powers capable of being developed with a fair and reasonable prospect of ultimate commercial success. They are a few of the smaller ones, wjthin, say, 10 oi i 5 miles of rising towns, and a limited number of others, where mining operations offer a market. Long transmissions are wholly out of the question at tho present stage of the country's growth, except for the rarest cases, such as the Waihi undertaking, where a 24hour heavy demand justifies a 48-mile line. The smaller water powers are essentially those that should be developed by private enterprise, or by the local authorities of the districts concerned, if they think fit. These undertakings are purely local affairs, and most, if not all of them, far from being potential gold mines, incur a substantial risk of not paying for several years. Upon what moral or other principle, then, should the whole country finance tho local trading enterprises of a very few favoured towns ? • Space does not roermit me to point out the misconceptions as to the influence of the railways upon the value of the vater powers ; this and other aspects of the subject must be reserved for some later ocqasion.