COBB VALLEY SCHEME

Nelson Evening Mail, Volume LXVI, 22 July 1935, Page 6

COBB VALLEY SCHEME

LICENSE GRANTED TO HUME PIPE COMPANY

FOR DEVELOPMENT OF HYDRO-ELECTRICITY

The license granted the Hume Pipe Company (Australia) Ltd. by the Government for the development of electricity in the Cobb Valley and for the erection of electric lines, has now been gazetted. The conditions in the license are set out as follows:

1. IMPLIED CONDITIONS The conditions directed to be implied in all licenses by Regulation 6 ot the Water-power Regulations 1954, except clauses 1,2, and 17 shall be incorporated in and shall form part of tins license except in so far as the same may be inconsistent with the provisions hereof. 2 LICENSE SUBJECT TO REGULATIONS This license is issued under the Waterpower Regulations, 1934, and is subject thereto and to the Electrical Supply Regulations, 1927, and the Electncul Wiring Regulations, 1927, and to any regulations made or to be made in amendment or amplification thereol or in substitution therefor. 3 UTILISATION OF WATER AND LOCATION OF HEADWORKS The licensee is hereby authorised to use the said water for the purpose oi generating electricity and for no other purpose, and the said water shall be taken from the stream at a point at a reduced level of approximately 2,5UUtt. above sea-level on Crown land in block 1. Flora Survey District, as indicated on the plan marked P.W.D. 89369, deposited in the office of the Minister of Public Works. 4 GENERAL DESCRIPTION OF WORKS (11 The licensee is hereby authorised, subject 'to the conditions hereof, to construct, maintain, and use the following works for the purposes of this license, the positions of the said works being indicated on the said plan:— (a) lleadworks, consisting of dam, weir, and intake in Block I, I lorn Survey District, raising the level of the water not more than 150 feet. (b) Tunnel and pipe-line (including surge tank) from such headworks tilronph Crown land to the power-house in Block XVIII, Takaka Survey District, and tail-race to the Cobb River, at a point in the vicinity of its conflu- ( dice with the Takaka River.

(c) Power-house and substations with all necessary equipment, including water turbines, generators, transformers, lightning arresters, switchboards, switches, exciters, and other appliances for generating, transforming, and transmitting electrical energy. (2) Electric lines as shown on the plan : (1) Commencing from the power-house and proceeding thence generally in an easterly direction for a distance of approximately seven miles to Upper Takalta, thence proceeding northerly for approximately thirteen miles, thence north-easterly for approximately six miles to Tarakohe: (ii) Commencing from the line described in paragraph (i) hereof at a point near Upper Takaka, and proceeding thence easterly for a distance of eight miles to a point north-west of Eiwaka, thence southerly for a distance of up-! proximately fifteen miles to Moutere, j then 'south-easterly for approximately twelve miles to a point south of Richmond, then north-easterly for approximately six miles to a point one and a half miles east of Stoke. (2) '•The plans submitted in accord- j ance with clause (7) of Regulation 6 of > the Water-power Regulations, 1934, shall j show the installation as proposed for the j initial development, and no addition thereto shall be made without the prior consent in writing of the Minister. (3) The initial development shall be 9,000 kilowatts. With the consent in writing of the Minister of Public Works Woods’ Great Peppermint Cure for Children’s Harkins Couarha.

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such additional plant may be installed as will enable the licensee to utilise the headworks to generate electricity to the maximum capacity of such headworks, but nothing herein shall be deemed to authorise the licensee to use a greater quantity of water than 200 cubic feet per second or to use the same water a second time. 5. DURATION OF LICENSE This license shall, unless sooner determined, continue in force for a term of thirty-eight years from the day on which it is first published in the “Gazette.” 6. SYSTEM OF SUPPLY The system of supply shall ue as described in paragraph (e) of clause 5 ol the Electrical Supply Regulations, 19 &<• The pressure of generation shall be approximately 6,600 volts, pressure ol transmission 66,000 volts, and the pressure of supply approximately H,OUU volts. 7. RENTAL For the rights conferred by this license the licensee shall pay to the Crown m New Zealand currency a, rental or annual sum of six shillings and sixpence per k.v.a. per annum in respect of tiie maximum demand at each.'of the piineipal substations. In this license “k.v.a. means a kilovolt ampere of maximum demand generated by the works anthoi used by the license and measured at the main switchboard at the principal substations. . , For the purpose of assessing sue rental or annual sum the licensee shall install at such substations suitable maxi-mum-demand indicators to the satisfaction of the Inspecting Engineer ol the Public Works Department, and failing such installation the rental shall be determined on the maximum capacity o the hydro-electric generating plant operated at any time during the rental period. Such maximum-demand indicator if installed shall be accessible to the Inspecting Engineer at any time and may be sealed by such officer between readings. 8 SUPPLY TO ELECTRIC-POWER DOARDS

The Waimea Electric-power Board and the Golden Bay Electric-power Board shall have the first call upon all or any power generated by the licensee, and i the licensee shall give to such Boards ! such supplies of electrical energy as tney j may from time to time severally require , on such terms and conditions not inconsistent with the following as may be I agreed upon, or, failing agreement, as ! may be determined by arbitration pursuant to the Arbitration Act, 1908: Provided that in the event of the licensee I not being able to supply the full demands of both such Boards such Boards shall share the supply available in shares proportionate to preceding six months as I determined by the licensee. (a) Quantity.—No assurance shall be i required as to the quantity of electiical I energy to be taken by the Board concerned, nor shall the Board be required to make any minimum payment in respect of supply. (b) Points of Supply.—Supply shall be given and taken at such points as may be agreed upon, provided that the Waimea Electric-power Board shall be entitled to receive supply at two points, one in the vicinity of Stoke and the other in the vicinity of Motueka ; and provided further that if the licensee gives supply to the Golden Bay Cement Works, the Golden Bay Electric-power Board shall be entitled to receive supply at a substation adjacent to the cement works, but otherwise the Golden Bay Electric-power Board shall be entitled

to receive supply at a point convenient to the licensee anil ciose to the centre of the Golden May Electric-power District as at present constituted. In the event of the Hoard receiving a demand for electrical energy in unroticulaled parts of its district or outer area in which the licensee has erected lines u> supply consumers, the licensee .shall give such supply to the Hoard at the licensee's* suh-statiqti nearest to the premises for which the Hoard requires supply. (c) Charges.—ln respect- of normal demand, the charge for electrical energy supplied to either Electric-power Hoard shall not exceed 02 10s per k.v.a. oi maximum demand per quarter for (lie first 2CO k.v.a. and ,02 per k.v.a. ol maximum demand per quarter for electrical energy in excess of 200 k.v.a In respect of supply for short periods or in emergency conditions the licensee may charge such amounts as may be fixed by contract with the Hoard concerned. For the purposes of this clause the term "maximum demand'’ means twice the number of units generated and recorded in tiie half-hour during which the (Output is the maximum for the quarter. (d) Undertaking.—-Before either Board may claim the benefit of this clause the Board concerned shall give to the licensee undertakings to the licensee's satisfaction as follows: (i) An undertaking to take from the licensee whatever electrical energy :t requires in excess oi that generated or capable of being generated by hydroelectric generating-stations as at present developed and now giving supply to such Board and by such other generat-ing-stations as may subsequently be agreed to by the Board and the licensee and approved by the Minister: and (ii) An undertaking not to install or construct during the period of this license without the consent of the licensee any hydro-electric works or other generating plant in addition to those already installed by the day when this license is first published in the Gazette" ; And without prejudice to any other rights Hie licensee may have, any breach of such undertaking shall disentitle the Board concerned to any benefit, from this clause from the time of such breach. (e) Date of Supply. —Supply shall be made available to both. Electric-power Boards in accordance with this clause immediately after the expiration ol the time limited in that behalf in clause 9 hereof.

9. COMPLETION OF WORKS Within two years from the date when this license is first published in (lie "Gazette” the works shall be completed to a stage sufficient to meet the whole ot the electrical requirements ot the Waimca and Golden Bay Elect rtcuower Districts; otherwise there shall b. no limitation as to the time for construction of works, but no additional works shall be installed after the expiry of the first twenty years of the license period without the prior consent in writing of the Minister. 10. LICENSEE’S CONTRACTS (1) Subject to the licensee or the consumer holding the necessary authority under the Public Works Act, 1928, to construct, maintain, cr use the necessary electric lines, the licensee may supply electrical energy to any consumer requiring 300 k.v.a. or more per annum, but the licensee shall not supply any other consumer within an electric-pow-er district or any consumer within the area, of supply of any other licensed supply authority without tire consent in writing of the Electric-power Board or supply authority concerned. In respect of each such supply, whether exceeding 200 k.v.a. or not, the licensee shall quarterly or otherwise as may be arranged pay to the Board in whose district are situated the premises so supplied a portion of the revenue received by the license in respect of that supply. _ The portion of revenue hereinbefore referred to siiali vary in proportion to the quarterly demand as follows In respect oi quarterly demand not exceeding 100 k.va. the tne portion oi revenue shall be 10 per cent, in respect of the first 100 k.v.a.. and 4 per cent, in respect of such excess demand. When the quarterly demand exceeds 250 k.v.a. but. does not exceed 500 k.v.a. the portion of revenue shall be 10 per cent, m respect of first 100 k.v.a., 4 per cent, in respect of tbe next 150 k.v.a., and 2 per cent, in respect ot such excess.

When the quarterly demand exceeds 500 k.v.a. the portion of revenue shall be 10 per cent, in respect of the first ICO k.v.a., 4 per cent, in respect of the next 150 k.v.a., 2 per cent, in respect oi the next 250 k.v.a., and 1 per cent in respect oi such excess. (ii) Except pursuant to an arrangement with the Elect.ric-power Board concerned, the licensee shall not give supply to the City of Nelson, the Nelson Freezing-works, or the Stoke Mental Hospital (iii) The licensee shall not enter into any contract to supply electrical energy if the supply contracted for, together with supplies required under all existing contracts and supplies required for the licensee’s own works, might exceed the maximum output of the plant. (iv) The licensee shall not enter into any contract to supply electrical energy in respect of any period termmating after the date of expiry of this license. (v) Every contract for the supply of electrical energy by the licensee shaii include provision whereby the contract may be assigned by the licensee to the Crown and shall be made subject to the provisions of this license. (vi) No contract for the supplying of electrical energy by the licensee shall include any covenant which on assignment of such contract to the Crown might bind the Crown except covenants as to — (a) The quantity of electrical energy to be made available: (b) The price to be paid in respect of energy supplied pursuant to the contract : (c) Any other matter tp which the Minister expressly agrees in writing; provided that the Minister's consent shall be deemed to be implied in respect of any covenant which at the time of the making of such contract is usually inserted by the Minister in his contracts with similar parties. 11. CONTINUANCE OF SUPPLY FOLLOWING ACQUISITION BY CROWN. (1) Should the licensee’s undertaking be acquired voluntarily by the Crown under paragraph (2) of clause 12 hereof before the expiration of the license:— (a) The licensee shall assign and the Crown will accept assignments of all contracts which may then exist between the licensee and its consumers, and, subject to the provisions of paragraph (c) of this clause, the Crown will give supply in accordance with such contracts: (b) Throughout the. unexpired term of the license, the Crown will supply and the licensee shall take such supplies of electrical energy as may lie consumed at the licensee’s works connected to this source at a price not exceeding the actual costs of generation and transmission to the point of supply (including interest and depreciation at the average rates payable on loans in the Electric Supply Account at the time of acquisition of the works by the Crown, but excluding any sum in respect of rental for the use of water) together with 10 per cent. I hereof : (e) In the event of any company in

which Ihe share-holders are substantially the same as in the licensee company having a contract with the licensee for supplies of electrical-energy current at the lime when the undertaking is so acquired. the Crown shall throughout tin l miexpired term of the license lie entitled to charge such company either tin 1 rate provided for in such contract or a rate calculated on the same basis as the rate, charged to the licensee whichever is the groa ter. (2) This clause shall not apply if the works revert to the Crown on the expiry of the license, or if the works are acquired by or vested in the Crown on account of aiiy default or expected default on the part of the licensee. 12. ACQUISITION OF WORKS BY CROWN (1) On Expiry.—lf the works authorised by this license have not been purchased or otherwise acquired by or vesed in the Crown in the meantime, they shall vest in and become the property of the Crown free of cost and free of encumbrances at the expiry of the License bv effluxion of time. '(12) By Purchase.—fTlie right is hereby reserved to His Majesty the King to purchase at his option at a price to be ascertained as hereinafter provided, this license, together with the undertaking of the licensee thereunder, and together with all real and personal property, and all rights acquired by the licensee under this license and used or enjoyed in connection therewith. The price shall be determined in the manner following, that is to say: — (a) If the'said ri<dit of purchase is exercised by His Majesty at any time during the first eight, years of the period of the license, the price shall be the net cost of the works plus a. bonus of b per cent, thereof: Provided that if the operation of the works hereby authorised during the period between the date of commencement of operations and (lie date of such purchase has resulted in a deficiency of revenue as against net oper-ating-expenses (exclusive of depreciation) plus 31 per cent, interest on the cost oi such works such deficiency shall be added to the purchase price. (1)) If the said right is exercised after the expiration of the said period of eight years, the price shall be the net cost oi the works plus a bonus of 5 per cent, thereof as above, and less depreciation from the commencement of the ninth year of the license. (c) If any additional works are installed during the first twenty-two years of the license period; depreciation in respect of such works shall he allowed from the date on which such additions arc first operated, or from the expiry of eight years after the date of issue of tile license, whichever is the later, and shall he similarly calculated, hut at such a rate as to reach nil value at the expiration of the license.

(d) If any additional works are installed later than twenty-two years after the issue of the license, depreciation in respect of such works shall be similarly calculated, but on the basis of a life of sixteen years. (e) The net cost of the works shall be ascertained by deducting from the total cost of the works any sum or sums paid by way of subsidy towards the works by the Unemployment Board or any other Government or public body; and the amount to be deducted annually lor depreciation shall be 3 1-3 per cent, of the sum of the total cost of the works and the bonus of 5 per cent. In the event of failure to agree as to the net cost for the purpose of this clause, such matters shall be referred to arbitration in the manner prescribed by the Arbitration Act, 1908, or any statutory modification or re-enactment thereof for the time being in force. (f) All expenses and receipts shall be fairly and properly apportioned between capital and operating accounts. No materials and supplies shall be charged to capital account at any price in excess of the current market rates at the time of purchase. The licensee shall at the time of commencement of supply submit to the Minister a statement showing in do. tail the cost of construction of the works and any receipts from disposal of capital assets, and in each subsequent year shall submit a similar statement in respect of any additions to or reductions from capital during the preceding year. (3) On Default, —In the event of the licensee discontinuing the supply of electrical energy in accordance with (lie requirements of this license, or in the event of this license being revoked or cancelled for breach of the provisions thereof, the works and undertaking authorised by this license or any amendment thereof shall vest in the Crown, without payment of any purchase-mo-ney, compensation, or other allowance, and free of encumbrances, and the Crown shall forthwith become entitled to enter into possession and control thereof. In such case the Crown may, if it so elects, operate such works at the sole expense of the licensee for such period not exceeding three months as may be nccessary to make permanent arrangements for' the conducting of the business of supplying electrical energy, but notice of intention to do so shall be posted to the licensee not later than two weeks after the Crown assumes control, and in such ease the Crown shall account to the licensee for any profits on operations during the period in which the licensee is so held responsible. Any mortgage charge or lion given by the licensee over the works or the undertaking shall be made expressly subject to this provision apart from or in addition to any other terms or conditions imposed by the Governor-General in Council or the Minister under Regulation 6, clause 21, of the Water-power Regulations, 1934. 13. ARBITRATION The Governor-General in Council shall be the sole judge as to whether the licensee has committed a breach of this license, but if at any time any dispute, difference, or question shall arise between the. license and Ilis Majesty or the licensee and either Electric-jower Board touching any other aspect of the con slruction, meaning, or effect, of this license, or any clause or thing herein contained or implied, or the rights or liabilities of the parlies respectively, or otherwise howsoever in relation to the premises, then every such dispute, difference, or question shall be referred to arbitration in the manner prescribed by the Arbitration Act, 1908, or any statutory modification or re-enactment thereof for the time being in force. 14. VESTING The licensee undertakes for ilself, its successors, and assigns that it or they will if and when required execute all such transfers, conveyance, assignments, and other instruments as may in the opinion of the Minister be necessary to give effect to the provisions of this license.