ELECTRIC GENERATION.

Taranaki Daily News, 20 August 1919, Page 6

ELECTRIC GENERATION.

THE POSITION EXPLAINED. | INSTRUCTIVE COMPARISONS. RECENT PRESS CRITICISM DISCUSSED. The following report was presented to Monday's meeting of the New Plymouth Borough Council by Mr. R. H. Bartlcy, AM.1.E.8, A.M.I.Mec.E. : In consideration of correspondence recently published in the Taranaki Dally News under tlie heading "Hydro-Electric Generation," it is to be expected that many not being conversant with the various methods of charging, for electric current supplied will doubtless meet with' confusion and misunderstanding. I will endeavor primarily to show how the business of an electrical supply system differs entirely from almost any other business undertaking, and if these principles are grasped, the figures which will be dealt with later should be more readily understood. The business differs in that the commodity sold is made and delivered at the moment of use, and that it Is the users only who control and regulate the rato of manufacture. The supply authority must have the necessary amount of plant to meet whatever call the consumers choose to make at any hour. Therefore the more lamps, motors and other apparatus there are switched on at any moment the greater Is the rate at which the station must manufacture and the mains deliver the commodity, and therefore the larger is the amount of supplying plant and, consqueutly, of capital In use. If a big business is done for only a brief period dally, the total capital Invested must be proportional to that business. REASON MOB CHARGING DIFFERENT RATES. A consideration of these facts can only lead to the conclusion that the one correct policy is to encourage as much as possible the spreading out of the business over the 24 hours. There Is only one practical way of Influencing this demand, and this Is through a suitable system of charging. The foregoing, therefore, explains the Teason why electrical energy Is sold at different rates during the 24 hours. The supply authority has to control and regulate Its peak loads. This introduces the important Item of "load factor," and this must bo clearly understood before one can grasp the principles on which the charges for electrical energy are based. The load factor Is simply the ratio of the maximum load (peak load) to the actual consumption In a given time, say, per month, per Quarter, or per year.

This will perhaps be more easily understood from an example. We will assume that energy is supplied in bulk to a consumer, and that the highest load reached or the greatest amount of power demanded by that consumer at any one time during the quarter is 50 horse-power (or 33 kilowatts), the consumer's meters show that during the quarter ho has consumed 23,908 units of electricity. His load factor will therefore be 33 k.w. by 2190 (the hours in a quarter), divided Into 28,908 units actually consumel by, 100—40 per cent. It is the aim of every electrical supply authority to increase Its load factor as much as possible, and this is done by regulating the charges during certain hours. Taking, for example, the case of the Ingfewood Borough Council with the price of £l2 per horse-power of, maximum load per year, charged on a quarterly basis, such being as per our agreement with that borough. I will take the figures re maximum loads as near as possible to that which I consider will be the actual result :

Ist quarter—January, Feb. March 86 hp. 2nd quarter—April, May, .Tune .. 100 h.p. 3rd quarter—July, August, Sept. 90 h.p. 4th quarter—October, Nov., Dec. 80 h.p. At £l2 per h.p. per year—£3 per h.p. per quarter.

Ist quarter, 80 lip. at £3 240 2nd quarter, 100, at £3 300 3rd quarter, 00 at £3 270 4th quarter, 80 at £3 240 A total of £IOSO. INGLEWOOD'S POSITION. Assuming that a load factor of 36 per cent. Is achieved, which Is quite a reasonable assumption, and which, I understand, Is almost 'reached at the present time, under existing conditions and which can he Increased considerably under future "conditions, Inglewood would be paying per unit of electricity received one and one-third pence. This is the amount we expect to, receive. 1 set out under the amount per unit that Inglewood would pay In accordance with the agreement at the various load factors, which are reasonable of attainment.

Fifty-two per cent, load factor, .B4d per unit; 50, .98d; 45, 1.09 d: 40, 1.2 d; 3C, 1.3d; 35, 1.4 d; 30, 1.6 d.

It must not be overlooked that these prices per unit arc t for all units received, and that the price per unit will remain unaltered Irrespective of the increase in maximum demand, providing the load {actor is maintained, and this depends on the manner in which the supply business is managed. It will be readily seen that Inglewood can afford to sell current at a very low rate during certain hours of the day, and thus build up the load factor. In the same way the prices for lighting, etc., which occurs during peak load hours, will bo increased, and thus every endeavor made to keep "down the peak or maximum demand on which the charges are made. Assuming that the price charged for current for lighting be only 5d per unit, which Is a low figure, then It will be .seen conclusively that even then there is a good margin for low power costs at other hours. * COMPABISON WITH COLERIDGE. It will be interesting now to make a comparison with the charges set out by the Sew Zealand Government for retail supply from Lake Coleridge system, and to see how near the Inglewood Borough' Council's costs per unit, etc., would enable them to come near to It. It will be understood that I am not dealing now with special bulk supply contracts. I will refer to these later. Rata A'.—Fixed Rate for Domestic and Farm Services. Minimum charge 4s per month, ' Lighting 3s per month per 120 watts, 2s SO watts, Is 6d ,60 watts, la 40 watts, 9d 30 watts, Od 20- watts.

Heating and Cooking.—2s per month for a 600-watt point for Ironing only and 5s ditto for ironing and cooking only. March to August Inclusive and 2s Cd per month from September to February! inclusive, 25s per month for 1 k.w. point for general purposes, including water heating from March and August Inclusive, and 12s 6d per month from September to February Inclusive; £5 per year per k.w. for living room radiators, £2 10s.per year per.k.w. for bedroom and bathroom radiators. Power.—£2 10s per year per horse-power frr domestic purposes only, £2l per year for 3 horse-power milking machine motor. Rate B—Two-rate System for Domestic Purposes, Minimum Charges 5s per month. ! Lighting—6d per unit. Heating and Cooking—During lighting hours 7%d per unit, other hours l^d. Rats C—Flat Rate, Minimum 5s per month. Lighting 6d per unit; heating and cooking, 3d per unit for first 80 unite per month, 2d for next 120, Id for all -units over 200. Rata D—Maximum Demand for General Purposes, Minimum Charges £3 per month. For Unrestricted Service—£l per k.w. per month from September to February (Inclusive) and £1 2s per k.w. per month from March to August (Inclusive); for night service (9.30 p.m. to 7.30 a.m. only) 5s per k.w. per month. Rate E—Two-Rate System for General Power Purposes. High -rate 8 a.m. to 9 p.m.—lf £lO per month is guaranteed H4d per unit, if £2O l%d, If £3O, Id. Low rate 9 p.m. to 8 a.m., '&& per unit. POLICY OF NEW PLYMOUTH.

I think It necessary that reference should be made relative to the price, £l2 per horsepower, inasmuch that this figure is for a term, subject at the end of that term to reconsideration, the object being with a view to reduction, It being anticipated that our system nil! have recovered from the efTects of heavy capital expenditure and be reaping tho benefits for such capital. If one stop 9 to think re the financing of an undertaking such as our scheme, It must.he readily admitted that prices cannot be cut too keenly In tho beginning or until such tlmo as the work Is brought to a state that the capital is being used to advantage. This Is the object, I understand, aimed- at by the New Plymouth Borough Council, also that the price of current offered to other local bodies shall be such that it can be retailed ,at prices less than any other form of power obtainable or likely to be obtainable in tho district. I think It will bo seen from tho foregoing figures that such Is the case, and that tho Idea of exploitation should, and I am of the opinion, will be dismissed? COLBItIDGE LOSS. There Is no denying the fact that many thousands of pounds were lost during the early years of working of the Lake Coleridge scheme. This is only to bo expected, and It will take time before the position is righted. With the Keiv Plymouth scheme this has to be avoided, and there is no doubt that it can bo done, and the consumers get benefits in the beginning that they could not get from any other source of power, and. In the near future conditions should be such as to compare favorably with those offered by the State supply in other parts of the Dominion. Before dealing; with the rates for special contracts made by the Government for bulk supply from Lake Coleridge, I wsuld like to stress ■Mitt UtfiwWM ttSu la tin *mu butt"

j ncss, known as the diversity factor. This [ factor Is simply the ratio of the total load I ronncclod lo ;hc peak, or maximum load on the {li.vstem at. any lime.

By Increasing this i'.i\crsity factor—-which meaus arranging Ihc lead through the mun.'um of the prices so that the various demands are not heaped up on top of each other — one is enabled (o sell the equivalent of Its maximum load many times over every day, which naturally means lower selling tn-ices to Iho consumers and higher returns to the supply authority. Tor instance, quoting the figures from Chrlstchureh mentioned at the Moa Road Board meeting, viz., "Christchurch received £53,000 for lis electrical energy last year, and took 21125 kilowatts from Lake Coleridge for which It paid £fi per kilowatt." Therefore Christchurch received £53,000 over £:iii2s, or £2O per lew. per year, for which it paid £0 per k.w., and 1 have no doubt (hat these figures are correct. AN UNREASONABLE COMPARISON'. 11l quoting the charges made by the Government per horse-power per year at £4 10s, one of the, lowest, if not Ihe lowest-priced consumer has been chosen, and one who paid to the Government yearly an amount of £13,100. Now It is hardly reasonable to compare a consumer of litis sort with the , likely consumers of Tanpakl. One has only to consider Iho amount of reticulation necessary In this district to supply pdwer sufficient to earn this amount of money at £4 10s per horse-power year, to see the unfairness of making Ihc comparison. Further the charges made to tho consumer In question is not a straight out charge of £4 10s per horsepower per year, but as under and on peak load basis: First 300 k.w., £8 13s 4d; iill over this at £3 per k.w. As it happens the average Is true in this cas_\ because the high rate is always exceeded, and It must bo admitted that It Is an exceedingly favorable rate for the supply of electrical energy. I will, however, quote some of the other smaller consumers and the rates at which they purchase electrical energy from the Government :

Sumner.—Energy is delivered at the borough boundary 50s per kilowatt per quarter (or £lO per year) peak load basis on maximum demand Is paid. \ Papanut —The Government price, £8 13s 4tl per k.w. per year peak load basis. Papanui, however, buys from the Christchurch City Council at a less rate, being first 50 k.w.'s, £8 13s 4d, second 00 k.w.'s £7, all k.w.'s after at £6.

Spreydon.—Buys from Christchurch, again being the cheapest, at l%d per unit. Woolston.—The Borough pays the cost of the reticulation, tho Government supplies the power and Doth share the receipts. Kaiapoi.—Borough pays for reticulation, the Government supplies power, and Is paid 40 per cent, of the receipts. Lover Kiccarton.—Purchases bulk supply from Christchurch City Council at £9 per k.w. per annum on peak load basis. Lyttelton.—Electrical power purchased from the Government on peak load basis at £lO per k.w. per annum. COLERIDGE RATES TO BE INCREASED. I understand from a communication received recently that tho minimum price published by the Government Lake Coleridge scheme on which all future contracts will bo based is one penny per unit not day time and one halfpenny during certain hours night time. The information is to the effect that present- contracts will all be revised and will not be renewed at a price under the above rates. It will be noted that It has been found necessary to 111 this price as the minimum basis, and which will naturally refer to larger and more remunerative consumers only. Wo havo here another instance for direct comparison with the Inglewood Borough Council's rates. It may be argued, and rightly too, (hat many of our consumers on this system and on the other systems, are not paying as much as £4 10s per horse power per year under present conditions. For instance, I have in mind several motors doing farm work, etc., and tile amount paid for current is approximately £8 to £lO per year on the unit basis. It simply means that the farmer has not -the requirements to use more, and would no doubt object if he were asked to pay £22 10s per. year for his flvo-horse-power motor, or £2l per year for a three-horse-power motor to drive his milking machine, as per rate "A" Government charges. In conclusion, I wish to refer to a remark contained In tho correspondence re "blanketing" nny smaller local body's scheme by increasing our supply area and embracing the site of a probable power station. I would like to explain, that I had no knowledge of any proposed scheme other than that of the Inglewood Borough Council's at the time of Using lite area to be applied for. I certainly did hear later of a proposed powerhouse on tho Manganui, but never really took the matter seriously. The only object, I had in showing the area as set out was to get definite boundaries, and if necessary these could bo readjusted. It Is hoped that those in need of electric power In this district will realise that tho New Plymouth Borough Council's aim Is to deliver the energy as cheaply.ns possible, but without making a big loss themselves. The quicker the system Is developed, up to a certain point, the cheaper tho energy can be supplied, and what will be a gain to New Plymouth in the matter of cheap power will also be a gain to tho whole district should they care to take advantage of It. COUNCILLOR CLARKE'S STATEMENT. - RECENT CRITICISM REPLIED TO. Cr. Clarke, In moving the reception of the report, said tho report, whilst setting out very valuable information^' 1 did not' specifically reply to tho grossly unfair charges and inaccurate statements made by Mr. Lyon In the newspaper correspondence referred to. He said he ■was not the least perturbed by the statements made by Mr. Lyon or likely to bo .by any statements he might feel disposed to make in the future. The News had, however, a very large and wide circulation, and It might possibly happen that those who do not know Mr. Lyon as well as they did might be disposed to take hlra seriously. First of all ho would endeavor to throw a little daylight upon tho underlying motive which he believed was the Teal cause of the recent outburst Mr. Gow, president of the Eltham Chamber of Commerce, at the hydro-electric meeting held in Stratford in October Inst, stated: "The trouble with Taranakl was that parochialism had retarded its progress for many years." Thero could be no more effective example of the truth of this statement than the actions of Mr. Lyon ever since the commencemnt of tho agitation for hydro-electric power in Taranakl. At the very meeting at which Mr. Gow made the above statement Mr. Lyon strenuously opposed a resolution urging upon the Government tho urgent necessity of proceeding with a subsidiary power scheme for Taranaki In conjunction with tho North Island scheme. Ho had looked up the report, which said: "Mr. Lyon said he was afraid tho small schemes would be snowed under in.tho big scheme and ho thought tho district should remember its own Interests wero its first Interests. The dairy companies in his district were needing power and were losing money "for w;ant of It. He did not see much advantage hi waiting for power from Walkato while they had streams at their own doors by means of which ample power could be developed." In condensing what Mr. Lyon said tho newspaper had been very kind to hfm for the clear impression left upon tho minds of a large number of those present was that he was opposed to tho Government scheme because It might seriously interfere with smaller schemes In Taranaki, and moro particularly with some little scheme ho had In mind for his own district. What that scheme was was disclosed later at a meeting of the Moa Road Board, when ho moved that the dairy factories and farmers within a reasonable distance of Manganul be circularised and that tho Town of Inglowood bo asked to co-operate in forming an electric Power Board. Now the same Manganui scheme had previously been considered both by Mr. Parry, the Government electrical expert, and by tho Inglewood Borough Council, and had been turned down by them as being too expensive, but in face of this Mr. Lyon was so obsessed with tho scheme that he apparently was prepared to recommend his own district to go on with It wllly-ullly. His impetuosity received rather a serious set-back when another member of the Board mentioned that Inglewood intended to scrap its plant and obtain its power from New Plymouth. This would naturally turn his attention to New Plymouth and when tho electrical engineer unfortunately, although quite by Inadvertence, adopted the Waltara River as a suggested boundary lino for tho New Plymouth supply area, thereby taking in that part of the Manganui which Mr. Lyon wanted for his scheme, it was quite easily understood why his nngor rose to fever heat. That was tho real reason for his outburst against New Plymouth which they had recently seen in the newspapers. The charges which lie made against New Plymouth were merely pegs upon which he bung his opposition, leaving his real reasons in tho background. ARGUMENTS EXAMINED. Mr. Clarke proceeded to examine somo of his charges and arguments in detail. He at once would relieve Mr. Lyon's mind by sayttiK that immediate steps would bo taken to cut out from their application the portion of the Manganui that Mr. Lyon valued so much. Thcj didn't want, and never did, want it. Mr. Lyoji had stilted: "Inglewood had agreed to take a maximum of 300 horse-nower at £l2 per horse-power per* annum whilst the Government were supplying power to Chrlstohureb City from Lake Coleridge at £4 10s per horseper per annum." His reply to this was that Inglewood had agreed to take a minimum of 80 horse-power at the rate of £l2 per horsepower based upon the maximum demand in each quarter. Tho minimum rises during ii period of ten years to 300 horse-power. It was therefore ten years after- the commencement of the supply before Inglewood 'was required to take 300 horse-power, although they might take up to that quantity at any time should they so desire. At the end of five years the charges would be reviewed, and if the two fttUtf ww m*bl* to mm, tta stunto

for a further period of Ave years wore fixed by arbitration. This arrangement was an extremely favorable one to Inglewood as it was now costing them approximately £3l per home-power with their present -plant. He nest cienlt with tho comparison with Christehurch. lu the early stages Inglewood was lo pay £l2 per horse-power, or* £lO per, kilowatt, upon a minimum of 03 kilowatts, whilst the (iovernment charge to Christehurch ivns £8 13s 4(1 per kilowatt for the first 300 kilowatts, and £5 per kilowatt for all over 300 kilowatts. Clirlatrlmrch paid the Government £13,100 per annum. Under their eontract Inglewood would pay New Plymouth .tllBO per annum. Christehurch took last year 21125 kilowatts from the Government. Inglewood In its first year would take CO kilowatts. These figures would show how crossly unfair it was to compare the two contracts. If Inglewood or any other district would agree t» take 2625 kilowatts per annum they would bo prepared to make u contract considerably under £l2 per horse-power per annum, but ihe circumstances In Taranaki were so totally different that no district could possibly make such an agreement.

A MORE EQUITABLE COMPARISON, lie was not prepared to soy that they could! come down to the rates paid by Christchurch, I because such charges would bo Impossible In Taranaki. It must lie romembercd too, tltat. the contract given by the (iovernment to Christchint'li was given when the previous low rate schedule was in force, and that Christehurch 1 would have no hope of Tenoning Its contract at the rates fixed by its present contract. A nioro equitable comparison and to hla mind the only equitable comparison was to compare what Inglewood would have to pay under the new schedule now being issued by the Government for the Canterbury district. The contract with Inglewood was for an unrestricted service. The charges would, therefore, bo based upon the Government Tate "D" for unrestricted service. This represented £l2 12s per kilowat per annum, compared with New Plymouth's £l6 per kilowatt per annum. It was quite possible Unit if Inglewood were in the Canterbury district it might be ablo to make a special contract with' the Government at a slightly reduced rate, but there was no I doubt In his mind that under the new management (he charges would be In ihe vicinity of El2 12s per kilowatt per annum, and taking into consideration the special conditions in regard to New Plymouth in the early stages of the installation, the chargo to Inglewood was quite a fair and reasonable one, and one under which Inglewood could retail the current at very low rates and still make a substantial annual profit. LOSSES OF LAKE COLERIDGE. The next statement was: "Another City councillor stated thai the Government lost | £311,000 on the working of the Lake Coleridge j plant last yoar." This was another misleading statement to suit Mr. Lyon's arguments What ho did say .was that the Lake Coleridge installation had lost £33,000 in the' first three years of its working after writing off a very sm.ill depreciation, viz, 2 per cent. The figures for the first two years to bo found in the Public Works Statoment of 1917. This was the official statement, and Ihe following Information could bo obtained therefrom :—March 31, 1916, completed one' full year's operation, callal outlay £320,230, total annual cost, Including 2 per cent, depreciation £26167. total revenue £BSIB. The total loss for the vear was therefore £17,049. March 31, 1017: Completed second full year's operation, capital outlay £306.984, total annual cost, including 2 jier cent, depreciation £32,730, total revenue £211,754. Adding the loss for the two years gave a total loss for that period of £29,605, and the balance of £3400 required to make up the £33,000 mentioned by him was the loss which he was given to understand resulted from the third year's working. In his second letter. Mr. Lyon challenged these figures; and expressed astonishment that ho should have talren tho unsupported statement of 1 an opponent of hydro-elecli'lcal development. Howover, as he had shown, the figures for tho first two years were taken from the official Government statement, and he had not at that time oven seen, much more Tead the pamphlet to which he referred. The official statement was quite good enough for him, and he ventured to say was quite good enough to satisfy .every other person In New Zealand, except, perhnps, Mr. Lyon. AN ERRONEOUS IDEA. Take two more statements: "The Borough Council frankly stated It. was not able to do the work through its own funds. It should be remembered that all were paying equally to tile Consolidated ltevemtc, and no section should he given preference by way of Government assistance." He had never heard such a statement from any member of Ihe Council. and he was perfectly sure that such a statement had never been made. It was well known lo everyone that New Plymouth was raising what money- was required upon the open market. No request had been made to the Government for Ilnancial assistance of any kind.

THE QUESTION' OF TROFIT. Tho next statement: "If the risks were great no one would object to n commensurate profit, but no chance Is left for failure when one horse-power which cosls £2O to devcloji returns £l2 profli in tho. first and succeeding years of working. Contrast this too with the fact that the partially developed Lake Colertdce scheme has cost £45 per horse-power for development, and a certain amount of relieuintion." In incompetent hands worked upon (he linos Mr. Lyon advocated, the risks would be very (treat, and could and would lead to the financial bankruptcy of the borough. Mr. Lyon dealt with the question as If New Plymouth had an immediate sale for the whole of Ihe 8000 horse-power. It had not, and it would lake anything up to ten years before they (vero in that positoin. If the complete scheme was gone on with, they could not expect to have more than from 2500 to 3000 horse-power altogether linked up during the first year, and It must bo remembered that it would cost almost as much to generate 3000 horse-power as It would Inter on cost us to develop 8000 horse-power. The whole of tho hydraulic work must he constructed in Its entirety, and the only part of the installation which could be postponed and put In from time to time as the demand warrants it, were certain machines In Ihe power house. Apart from this the whole nf tho estimated cost of approximately £IOB,OOO would have to be expended within the next two years. Deductini! from this the value of the machinery not installed for the time being at a rough guess, sav, £25,000, they had an expenditure of £83,000. To this must bo added the £82,000 cost of tho present installation. In the u'tst and* possibly part of the second year, tho capital' expenditure to produce 3000 horse-power would therefnro amount to £105,000, or a cost per horse-power of £55, not £2O, as stated by Mr. Lyon. It was admitted that when tlio complete 8000 horse-power was being developed the cost per horse-power would possibly be not more than £25 per horse-power, but they would have to deal with the position in its early stages. GOVERNMENT'S POLICY IMPOSSIBLE IN TAItA.W.KI. He 1 was not going lo quarrel with the Government's policy of fl.vlns the charge at a figure which could not possibly pay in the early stages, but which would ultimately make •the system self supporting later on when the whole of the available power was being sold. But he would emphatically say that no ordinary local body can adopt this policy. What, local body could afford to lose £20,600 in two years in tho hope or expectation Hint "the deficits inevitable in tho early two years of the undertaking shall be paid out of, future surpluses." Where would the money come from in tho first place? The Council had no power to raise tho money bv loan, and even if ibere were power to raise it by rate he would, not like to be one of a Council who tried to levy a heavy rate (and it. would have to bo a very heavy one at that), in order that electrical power might be sold at a price very much loss than it was costing to produce it at that particular time. ■ Going hack to Mr. Lyon's statement: "But no chance is left for failure when one horsepower which costs £2O to develop returns £l2 profit in the first and succeeding years of working." If this were correct thero naturally would be no chance for failure, but Mr. Lyon knew as well as anyone tljat the £l2 was tho gross receipt, and that only a very small proportion of the £l2 would be profit after allowing for working expenses, interest on capital, and a reasonable depreciation. The correspondence was very lengthy, and, unfortunately, teemed with Inaccuracies, and be would not weary the meeting In further dissecting the statements.

NO INTENTION TO EXI-liOIT TAIUNAKI In view of what had taken place, lie thought It would be as well If ho stilled that It was not the policy or Intention of the New l'lymouth Council to exploit the surrounding districts by excessive charges for power. All that thev desired to do was to fix the prices In the early stages at siuii a rate as would movent (he Council being landed in financial difficulties. Their ultimate hope was to provide cheap power for the whole of IforlJi Taranaki. It was better to adopt the present method than to sell at too cheap a rate, and to have to increase that (ate Inter. If they were the exploiters and monopolists Mr. Lynn -would have ooople lo believe, they would adopt the method of exploiters and fix very low rates now to Induce hwal bodies and large private enterprises to link up with Ihem, and when they hud scrapped their plant and put In new plant to suit Iholr system the prices in future contracts would he raised, They preferred to tell their prospective consumsrs the true position. This was the lowest price they could safoly give Ihem In the early slniren of the installation. They were quite satisfied that later on when the consumption was Increased and greater quantities of power were developed they could give them better terms. This reference to prices would naturally raise hi paople's minds the question: Would Now Plymouth, at il later date, be able to supply current at the same low rate ns the Government now supplies Chvlstcliurch ? He was satisfied that they would never be able to do so, benuWi la Um era nUda lion uutld »«v«r fes"

n consumer in Taranoki who would lake at one point current to the value of over £13,000 per annum. In the second place he was firmly of opinion that Ihe price as originally Uxed was too low.

OOLEHIDGE TO INCREASE ITS CHARGES. One of the very first things .Mr. I'nny's successor did after taking up ills duties was to bring a new schedule of charges at substantially increased raids. Mr. Blrks, the expert referred to, was formerly in charge of the Lake Coleridge system, and had a first bund knowledge of the whole position. Mr. Bartley's report set out the new rates, In addition Mr. (.'lark had seen a further telegram from Mr. .Mirks: "Minimum unit price published .by Department Lake Coleridge on which all future contracts based Is Id day-time, the W nighttime." I'rom the schedule of charges they would see that day-time really means front's a.m. to !) p.m., ami ulght-tlme means from II p.m. to 8 a.m. Now tin's was the niiflmuiu, so that Chrlstchurch, being the largest consumer, would probably receive current cheaper titan any other consumer. In future contracts therefore. Chrlstchurch would probably have to pay the rates mentioned. He had asked the electrical engineer to give him an idea of what Chrlstehurch's position would be under a contract based upon the new charges. Tho following were his estimates They were based upon the followiut flgurea: Price per kilowatt pet annum, approximate!), *a#: Sim aa Ummmmt <mt imam, w

proximately, £9 Os Brt. If Christchurch would eventually have to pay £9 6s 8d per horsepower per annum, then under the special conditions of their supply during the early stages their charges of £l2 per liorse-pnwer was a perfectly moderate and reasonable one.

BENEFITS OP CHEAP rOWBK RECOGNISED. Later on when their power development approached (10(10 horse-power, he felt confident they would he able with larger contracts to supply at the £9 6s 8d per horse-power and probably may be able to get under that figure. He was also confident that at that time also with smaller contracts and supplies they would bo able to get down to the rates »set out In the Government's new schedule. fn conclusion, Cr. Clarke said: "New Plymouth cannot progress unless the surrounding districts progress, and no one recognises more than we do that it Is to our pyru Interest to assist In every way the progress of the rest of Taranakl. There Is not the slightest need for any anxiety that If wu hive the power to sell we will hold up the rest ot Taranakl by demanding extortionate, rates. The power will 'be sold .it tho lowest rates possible, consistent with ti.o policy of all sound business enterprises that the people who find the capital must bo able to secure a reasonable return upon their Investment. At the same time no one must jrun away with the Idea that either we or the Government can sell thej current In hulk on an unrestricted >ecvlc« at *m tea it m*t« m to flaw*** *■" '