POWER COSTS

Hauraki Plains Gazette, Volume 52, Issue 32310, 8 September 1943, Page 5

POWER COSTS

POLICY OF VALLEY BOARD POSITION EXPLAINED, . METERING OF WATERHEATERS “There appears to be a great deal of misunderstanding regard- ■ ing the metering of water-heater service,” stated the Paeroa member of the Thames Valley Electric Power Board, Mr C. C. Webb, this, morning. “At the outset, however, let me make it plain that I do not claim that consumers are going to get the same service as in the past at the same price. Let me also state that the policy of the ‘ Thames Valley Board, as I understand it, has been, and is, to supply electric power to as many people as possible as cheaply as possible, coupled with an efficient service. Difficulties Faced “In order tc- understand the difficulties facing the Thames Valley board and other supply authorities it is necessary to set out certain facts. Firstly there is the system adopted by the Public Works Department of charging supply authorities on a maximum demand basis, irrespective of the load factor.

This naturally induces supply authorities to increase their load factor by offering power off the peak at a very cheap rate. This is satisfactory to a point, but the time arrives when, the cheap load factor becomes a burden and does not bear its fair proportion of costs and charges. For instance, in the Thames Valley area 56 per cent, of the units sold were for waterheaters but they provided only 17 per cent, of the total revenue derived fr®m the sale of power. Approximately 50 per cent, of the board’s consumers have installed water-heaters; it follows therefore that the' other 50 per cent, have to pay a much higher rate for power than they should be called upon to

pay. I merely place these facts before the public so that they will bettei’ understand the position. They do not | su PPly the real reason for deciding to ! meter water-heaters. Shortage of Power “The real reasons are found in the shortage of power and the necessity to eliminate waste. The 'Government has brought down regulations dealing with the metering of water services and the objects of the regulations are: (1) To reduce use of electricity by eliminating possible waste; and (2) to aim at cutting by 20 per cent, the use of electricity in water heating in domestic and dairy installations. In this connection the supply authorities are not to be blamed for the shortage of power. As long ago as 1938 representations were made to the responsible authorities urging that steps be taken to increase the generating capacity'in New Zealand. This winter found the North Island faced with an extremely serious position, and it was only through the. cooperation of the public that power was not cut off altogether at certain times. “The Government > now proposes to build a large number of State houses and it is estimated that 12,000 State and private houses are to he built in the next iwo years. They want power. In the absence of increased generating capacity this can only be obtained by effecting savings in present consumption. “Metering waterheaters provides the largest avenue for saving power. The flat rate induces waste and by metering the consumer will pay for what he uses and for what he wastes. He will soon get tired of paying for the latter. Question of Charges “Now for the charges. Let me repeat that the board had no desire to increase charges simply to increase revenue. The board is in a healthy financial position and does not aim to make large profits. However, by compelling supply authorities to reduce unit consumption, but still insisting on charging on a maximum demand basis, the Public Works Department has compelled supply authorities to make some alteration in its system of charging for water heating. “In the first place, consumption in an average household was taken as a guide. Experience showed that the average household uses 30 units a month for lighting and radio; then i for a stove the board estimated that 150 units a month was reasonable. J. The Price Tribunal cut it to 120 units 1 .

a month. All right, then; we allowed the 30 units at the same rate as before, similarly with the 150 units (now 12*0) for the stove. To this point there is no change. “It was next estimated that 40 units

a month for each 100-watt of element would provide a reasonable hotwater service. I will be frank and say that on this estimate there is room for a difference of opinion, but the Price Tribunal has approved of it. This, means that a 750-watt element is estimated to use 300> units a month to give a reasonable service. In fixing the charge it had to be remembered that water-heating was not bearing its fair proportion of costs and charges. Water-heating last year produced on an average .257 d per unit. The price fixed, therefore, .333 d or .666 d depending on the nature of the service,. is considered reasonable. “Naturally, there had to be a stoprate, otherwise the desired objective of saving power would not be achieved. Therefore any units used over what is considered a reasonable use revert to the penny rate. The Average Householder “Now since complaints have bteen made I have made enquiries and obtained an account from an. average household with all electrical appliances. I find that the average consumption in winter for two months is 302 units, with a gross charge of £2 10s 2d. Allowing the user an average of 16 hours for his water service on a 700-watt element his new account ’ will be £3 7s lid gross, an increase of £5 6s 6d per annum based on the whiter months—a long way from doubling the account. And it should -be remembered that this is based on the winter months, when consumption iM high. *

Actually the increase will be much less than £5 6s 6d per annum. I have ■also allowed 16 hours, which does not provide for the 20 per cent, saving aimed at in the use of power. To give effect to the 20 per cent, saving would, not involve the consumer in any increased charge at all, but admittedly he would not be getting the same service.

“I hope that this statement will assist consumers to realise the difficulties confronting the board, and i» appreciate that it is the serious power position that prevails that makes a change necessary. It is now a local matter, and other boards have had to fallow the lead given by the Thames Valley board.”