PRICE OF GAS

Greymouth Evening Star, 8 September 1939, Page 10

PRICE OF GAS

INCREASE PROPOSED. BOROUGH COUNCIL’S DECISION. 1 Provided the Board of Trade consents, the price of gas will be increased in Greymouth next month from 6/8 nett per 1000 cubic feet to 7/6, with other special charges increased in proportion. This decision was reached at last evening’s meeting of the Borough Council, on the recommendation of the Gas Committee. The consent of the Board of Trade is necessary, since, under the Emergency War Regulations, it is illegal to increase the price of commodities without such approval. .. The report? of the Gas Committee on the subject hyas as follows:. The. Committee met on? August 31. for ..thepurpose of .devising ways- and?means of putting the Municipal Gas Works on a payable basis, the .past year’s trading figures having shown a loss. In dealing with the question it was pointed out that the Grey Electric Power Board commenced supply in April, 1926, and, for the year ended March 31, 1926, the make of gas was the highest ever produced at the works, totalling 47,382,000 cubic feet. .The 1 make steadily declined until,- in the year ended March 31, 1-934, the total was down to 31,304,000' cubic feet. Since that date the output has increased until last year the make was 39,565,000 cubic feet. In 1926, the price of gas to the ordinary consumer was 7/6 nett per 1000 cubic feet, whereas for some years past the price has been 6/8 nett, and a new rate has been introduced for gas used in fires and storage water iieat- 1 ers, namely 3/2 nett. The character of the demand has changed radically, since before the Power Board operated. Then, a very considerable block of gas was used for the pumping of the Borough water supply, and for street lighting, and with gas lighting general, the load, was distributed more or less evenly over the daily hours of consumption. Now, a maximum demand period is strongly in evidence, the demand increasing from 8 a.m. to a maximum at about mid-day. The gas works formerly returned a handsome sum to the general account of the Borough, but this, of course, declined until last year it was barely possible to make ends meet as far as revenue -from all sources and expenditure on all counts were concerned. Reasons for the decrease in revenue have been touched upon. Increases in expenditure have been governed by three principal factors, namely: Wages on account of the introduction of the 40-hour week, cost of coal, largely influenced by the same circumstance, and. lastly, unprecedented expansion in the past three years in the reticulated area.

Regarding wages, for the .year exiled March 31, 1935, these totalled £3,058, employees numbering 14, whereas for the past financial year wages totalled £4,707, and employees numbered 16. the increase on the latter being accounted for by the additional stokers engaged to meet the requirements of altered working conditions. Concerning cost of coal, for the year first referred to (1935) the cost averaged 17/4 per ton, whereas for last year the average was 20/1 per ton, these costs being at the coal chutes in the railway yard. During the past three years the reticulation system has been extended at a rate far exceeding that' of many years previously, the expansion being

occasioned by the opening up of new [subdivisions, and building; by private individual's, arid by the supply afforded io the Government housing block, I Cobden, the cost of these . having 'been met out. of reveniue. In addi- > tioh, Blaketown air’d Preston Road have been reticulated, that cost having been met by way of a loan. To show how the extension has been justified, it may be recorded that 34 consumers are already availing themselves of the supply in this latter area and their consumption amounts to 75,000 cubic feet per' month. Every niontjh brings new consumers in this Urea, two further having been connected since the writing of this report.

DETAILS .OF INCREASES. 1 ■ ■' '-. 4' . ■ • . In' vibw of the lack of margin between revenue and expenditure, your Committee is reluctantly compelled to recommend certain increases in the prices charged for gas, coke and services as follow—'.I; • That tho general price for gas be as 1 foliows, namely: — (a) For a quantity less than 6000 cubic feet supplied in any one calendar month, 8/4 per 1000 cubic feet, less a discount of lOd per 1000 cubic feet for payment by due date, that is, 7/6 nett pei’ 1000 cubic feet, as against the present price of 6/8 hett per 1000 cubic feet.

. (b) For a quantity of 6000 cubic feet and over, up to 10,000' cubic feet supplied in any one calender month. 6/8 per 1000 cubic feet, less a discount of lOd per 1000 cubic feet for payment by due date, that is, the price shall remain as at present, namely 5/10 nett per 10.00 cubic feet. (c) For any quantity, in excess of 10,000 cubic feet supplied in any one calendar month, 5/- per 1000 cubic feet, less a discount of lOd per 1000 cubic feet for payment by due dafe, .that -is, ; the price shall remain as at present, namely 4/2 nett per 1000 cubic feet. (2) That the price of gas for gas fires, central heating, and water heating used commercially be raised to 5/- per 1000 cubic feet, less a discount of lOd per 1000 cubic feet for payment by due date, that is 4/2 nett per -1000 cubic feet as against the present price of 3/2 nett per 1000 cubic feet.

(3) That th© price for gas for gas fires, central heating, and water heating, used domestically, be 4/2 per 1000 cubic’ feet less a discount of lOd per 1000 cubic feet for payment by due date, that is 3/4 nett against the pre-, sent price of 3/2 nett per 1000 cubic feet.

(4) That the minimum charge on account on any one meter shall be 2/6 per month. (5) That a consumer, requiring the temporary removal of a meter, in order to obviate minimum charges during a period when gas may not be required, be charged a. reconnection fee of 10/- when it is required that the meter be reinstalled. (6) That, the price of coke be increased bj r 3d per bag. The following are further recommendations of your Committee, name|ly: —

I That an additional one gross of gas [meters be purchased for the replacement of meters which have reached the end of their useful life, the' payment to be mot by withdrawal from the Gasworks Depreciation Fund which is vested in the Public I’rust.ee. That the 8-inch diameter feeder main to the intersection of Brunner and High Street, estimated at £846. in the report of the Gas Manager to the Finance Committee, dated August 124, be approved. . INCREASE ESSENTIAL. Speaking to the report, Cr. J. Saunters, chairman of the Gas Commit-

tee-, said that the members of the Committee had been very reluctant, indeed, to make the increase. The Committee had staved off the evil day as long as possible, but now an increase was essential. The increased prices, it was proposed to charge, were on a par with those charged in 1926. Therefore, during the past 13 years the consumers had enjoyed ,a reduced price, and he hoped they would view the matter in that light. In the average household the consumption of gas was 2000 cubic feet per month, so that the increase would not be a very great burden. On the other hand it would help the financial position of’ the Gas Department considerably. Two important factors making for the increase were the rise in wages and the rise in the price of coal. Under the Emergency Regulations introduced by the Government on account of the war, increases in the prices of commodities were forbidden, and it would therefore, be necessary to obtain the approval of the Board of Trade to the increase. However, the Council had a good case, since the matter had been under consideration for a considerable time past, and last year’s trading figures had brought the question to a head. Or. Saunders moved the adoption of the Committee’s report. Cr. C. Neville, in seconding the motion, said that Cr. Saunders had been almost apologetic in his remarks, and he did not think there was any need for that. During the depression, the Council had reduced the price of gas, and he would like to know of any commodity that had not increased in price during the past live years. The proposed increase was a'businesslike move. If the price of gas were not increased the ratepayers would have to pay for the deficiency in increased rate's. The increase in the price of gas was overdue, and the Committee was to be commended for facing the position in a businesslike way. There was no reason for any member of the Committee to feel apologetic. Cr. F. F. Boustridge: Up to the present we have been selling the cheapest gas in New Zealand. It might be wise foi’ the committee to publish :• table giving a comparison with the prices charged in other places. Cr. Saunders said that, owing to tho different methods of charging for gas, it was not easy to make a comparison. Cr. Boustridge: How do the proposed charges compare with those in other places? Cr. Saunders: They still compare favourably. Cr. J. B. Kent: Another point is that the calorific value of our gas is better than the average. The report of the Committee was adopted, and it was decided to apply to the Board of Trade for approval to the increased charges to take effect as from the date of the commencement of the meter reading-next month, October 26.

With regard to the 8-inch feeder main to the intersection of Brunner and High Street, it was decided that the gas manager should take the necessary steps to procure the required materials to be available for the' work to commence on April 1 next. It was left to the chairman of the Gas Committee and the engineer to decide when the material should actually be purchased.