THE OTAGO DAILY TIMES SATURDAY, OCTOBER 26, 1935. ELECTRIC POWER SUPPLY

Otago Daily Times, Issue 22712, 26 October 1935, Page 12

THE OTAGO DAILY TIMES SATURDAY, OCTOBER 26, 1935. ELECTRIC POWER SUPPLY

Provisions relating to the control of electric power supply which were contained in the Public Works Bill—one of the measures introduced in this closing week of the Parliament—provoked considerable criticism on behalf of certain supply authorities, by reason of their seemingly drastic implications. The Minister of Public Works expressed surprise at this, and in view of the lack of opportunity for discussion of the proposals this session, withdrew them from the Bill. They were merely intended in any case, Mr Bitchencr explained, to consolidate and confirm the policy earned out by the Government during the last few years. Whatever justification there may have been for the apprehensions that were excited, the Minister adopted the discreet course. If so much more can be read into the proposals that he says was intended, it is well that they should be more closely examined for the satisfaction of all parties conconcerned. It does seem clear that certain supply authorities might be vitally affected were the department to be given the authority which the Bill proposed in respect of the operation of stand-by plants. In a reference in the Public Works Statement to the bulk supply

charges, it is to be noted, the Minister said: “It is indeed questionable if we have not been contributing by way of rebate on ordinary charges too much towards the cost of these stand-by stations.” In the North Island system, he added, the value of allowances made for these plants plus the cost of maintaining the department’s own stand-by amounted to about £BO,OOO per annum, or more than twice the total annual operating cost of the whole of the Government’s own main generating plants in the same area. The inference is that in the department’s view security may be purchased at a cost to the system that is too high. One of the provisions of the Bill was interpreted —not unreasonably, we think —as authorising the Public Works Department to sell power, not on a basis to be agreed upon between the supply authorities and itself, but upon such terms as the Minister might think fit. Against such a proposal there are obvious objections. Agreement by negotiation is the present practice, and local authorities would certainly resist the discontinuance of it, if that were seriously contemplated. Mr Bitchener’s concession to views based on a reading of the proposals of which he does not admit the correctness leaves the matter in abeyance in the meantime. Apart from that their interest consists in the extent to which they may reflect the views of the Government concerning the conditions by which the supply of electric poAver in the future should be governed. The leader of the Democrat Party seized the opportunity of asserting that the Government has been prompted to seek monopolistic powers because it has grossly overcapitalised the hydro-electric undertakings. As a matter of fact, the results from the operations of the State schemes, heavily capitalised as they are, have been quite satisfactory, representing at the close of the last financial year a return of over seven per cent, on the capital invested after allowance for working expenses. Moreover, the demand for electric power may be expected to increase, and the value of the system to the country likely to be proportionately demonstrated. “ The present system of control,” it is observed in the Public Works*Statement, “has developed, and undoubtedly has been very successful, as a means of making power available as widely as possible throughout the country. As to whether or not it is just as well suited for the future administration is being given a considerable amount of attention to see if any modifications are desirable in the interests of uniformity and economy.” Meanwhile the Ministerial assurance is that the department has been merely intent upon confirming the present practice and that it will carry on its administration as in the past.