HYDRO=ELECTRICITY.

Waipa Post, Volume XXIV, Issue 1415, 13 October 1923, Page 6

HYDRO=ELECTRICITY.

IVAITOMO v. TK AWAJIVTI'. TWO SCHEMES COMPARED. ■Messrs Vickerman and Lancaster, the well-known electrical engineers, of Wellington, recently furnished the following valuable report to the Otorohanga Hydro-electric Committee In accordance with Mr Vickerman s recent promise, we submit the following notes on the cost aspect oi electric supply in the hope that they may prove useful, even though hi eaking no new ground. in assisting your committee to crystalise its ideas. We should have written earlier but have been awaiting receipt of the file promised by yourself, but which is not yet to hand and apparently will not lie available. We take it that what your committee has to decide is what source of supply is the cheapest and Inost efficient for your locality. We therefore propose to outline, and to later deal separately with the several conditions which have the greatest effect on the cost of electric supply to a power board's customers. These conditions are as follows: (a) The prime cost of bulk supply to the Power Board. (b) The system under which the Power Board is charged for supply. (c) The efficiency of the Board’s system of supply lines, transformers, etc., as measured by its ability to deliver current to the consumer without excessive losses. , (d) The capital and overhead charges which have to be made and included in the retail price to meet the interest on cost of construction. depreciation, staff salaries, etc. le) The load factor. (f) The diversity of demand in the area. Re (a). Cost of bulk supply to the Board.—The charge for Government supply is .CIO per k.v.a. per annum for the first 200 k.v.a.; £8 each for the next 4SOO k.v.a., and £7 each for quantities greater than this. This charge is now standard to all Boards and purchasers, except to some Coleridge customers, whose price is alfected by contracts entered into several years ago. It would be the same to the Te Awamutu and Te Kuiti Power Boards. The only way for a Board to get a cheaper supply is for it to develop some favourable hydroelectric scheme of its own, when, under favourable circumstances the cost may come down to two-thirds or half the above. In this connection it may be mentioned that there is a small and allegedly favourable scheme offering on the Moltait River. Re (b) System of charging the Board. —The Government charges quarterly on the maximum demand, averaged over half an hour, recorded during the quarter. The charge is exactly the same if the demand exists for half an hour only on one day as it would be if the same demand existed for 24 hours on every day in the quarter. It follows that if the demand of the Board’s customers is steady and prolonged, the Board, seeing the cost to it is unaffected, could afford to charge a relatively lower rate for each unit sold than it could if the same maximum demand were registered for only a short period tit occasional times. A cheap unit cost is thus obtainable by keeping the maximum demand down and by using the current for a large number of hours each day. This aspect of the question is referred to again under load factor and diversity below.

Re (c). Losses in the supply system. —Whenever current is passed through a transformer, or along supply lines, or through a meter or other device, there is a certain amount of loss. In a well designed system this loss is less than 20 per cent., but in some systems, Te Awamutu for one, the loss is upwards of 40 per cent. Now, in view of the fact that the Board is metered for charging by the Government at a point before the loss occurs, it must charge its customers the same amount for the smaller number of delivered units, that is, .it has to charge a higher unit rate, and the greater the loss the greater this increased charge must be. This loss, beyond what is needed to pass the electricity along, is an absolute waste of power, and of money in paying for the wasted power. Re (d). Capital and overhead charges.—Once a Board has embarked on a scheme of construction it has to meet the annual interest charges on the cost of the works, and to provide for their maintenance and depreciation, and for the salaries of the staff employed. These charges have to be collected either by rate or by proportionately increasing the unit charge to its customers for power. These charges are much the same and still have to be met. whether the demand for power is large or small. Now, since to make electric power competitive, there is a 'limit to the unit rate chargeable, it follows that any district which is over capitalised by having thrust out lines into unpayable areas, must, till the demand grows, not only pay dearly for power, but must nay a rate in addition. Unfortunately. paying dearly for power does not stimulate the growth of demand, and the prospects of the district are again defeated. This error of overdoing things has to some extent been committed in the Te Awamutu district. It does not follow it will not he in Te Kniti, but the example of its neighbour and the consequent results should act as a strong deterrent.

Re (e). Load factor.—ln practically no industry is the demand for power continuous for 24 hours during every day in the year. Generally power is used for eight hours or less, and even during that time the demand is not continuous. The ratio per cent, of the average load to the maximum gives what is called the “load factor.” This average, if taken over a day, gives the daily load factor, or if over a year the yearly, or similarly for any period of time. As pointed out undfer paragraph (5) above, where the supplying body purchases its supply on the maximum demand system, it can afford to sell cheaply to a customer having a high average demand, or what is the same thing, a good load factor. Re (f), Diversity.—Where power is taken by a number of consumers for a variety of uses, particularly uses of short duration, it is found that the

demands frequently occur at different times in the day. Thus Mr A uses one unit between 6 a.m. and 7 a.m.; Mr B wants 1 unit between 8 a.m. and 9 a.m.; Mr C between 9 am. and 10 a.m.; Mr D between 11 a.m. and 12 a.m.; Mr E between 1 p.m. and 2 p.m. To meet this demand the Board has to pay tor a maximum demand of only one unit, and there is said to be a diversity of live between the demands of the consumers. It follows that the Board can, under these circumstances, afford to charge a lower unit rate than it could if only two consumers used the power, that is, if the diversity were only two. The real effect of diversity is to create a good load factor for the Board when its demand on the Government is considered. This diversity and consequent improvement of the Board’s load factor may be, and often is, artificially stimulated for arranging for different industries to use power at different hours; a specially low rate being offered as an inducement for power to be used at night. The greatest diversity is usually found among the small consumers of a residential area. ’There persons cannot be expected to have needs creating good individual load factors, but the diversity in the times ,of their small demands produces the same effect so far as the Board’s purchase from the Government is concerned, as, not being cumulative, the Board’s maximum demand, on which above it pays, is kept down. Similarly in the case of industrial consumers the diversity is not so high because in these cases the individual load factors are high and the times of demand must therefore overlap. By virtue, however, of their individual high load factor, they are ensured power at cheap rates. It follows that every must be used to increase diversity and load factor ■ 're cheap power is desired. One potent factor in that direction is to group together town and country areas, as the different occupations and habits of the two classes of inhabitants are found to produce a natural diversity in the times of their demand for power. The diversity as discussed above is the actual diversity between consumers’ maximum demands, and is the diversity which is operative in reducing the cost of supply. Because customers’ maximum demands are not always measured. and because they usually bear a more or less uniform relation and the connected load, which is easily ascertainable, it is very common to consider diversity as between the connected load and the maximum demand found necessary to meet same, and this is how the diversities tabulated in the Public Works Department statement are calculated. It is obvious that under some circumstances, say in the case of a big works, where there is little going on, the figures may be misleading and yield an apparently large but really valueless diversity. The method of calculation, however, is convenient, and serves the purpose well enough. The comparative figures given in t.he last statement are of interest:—

lii our opinion the relative advantages of joining either Board may he summed up as follows, taking each cost heading separately:—(a) The prime cost from the Government would be the same to both Boards, but a Mokau River scheme would, Mr Muir reports, offer cheaper power, (b) The same system of charging would apply to both Boards, (c) The losses in the Te Awamutu area are excessive, and in Te Kuiti the position is and should remain much more favourable, especially with a direct feeder from Arapuni. (d) The capital charges in Te Awamutu are excessive and must affect prices for some years to come—at the same time, out of an annual expense of 6.18 d per unit sold, capital charges only account for 1.98 d; in the case of Te Kuiti they account for .99d per unit (e) The load factor (34.2) of Te Awamutu is surprisingly good. Te Kuiti (27.5) owing to, till recently, the non-development of night load, is 11*0 1 for comjparative purposes as given in the table above, quite fairly stated. We consider that a construction of Te Kuiti and o country area should yield a load factor of between 35 and 40 per cent, (f) Diversity— The figures given for Te Kuiti show a better diversity now, and if combined with a country load, they should not go back. From the above you will gather that, generally, our opinion is that you would gain more by joining in with Te Kuiti than Te Awamutu.

Name. Te A. Te K. Area served P.B. Bor. Population 9000 2300 No. consumers 660 525 Max. load (k.w.) 208 110 Connected 981 590 Diversity 4.7 5.4 Percentage of units lost in system and non-productive 43.0 18.7 Annual load factor .. 34.2 27.5 Capita] invested .£119325 £16002 Revenue £7145 £5055 Capital charge .. .. £2849 £890 Power and general .. £6276 £3321 Total annual charges £9125 £4211 Profit Nil £844 Loss £1980 Nil Rate .14(1 Nil Average rev. per unit 4.04d 5.64(1 Average rev. per unit p.h. max. per k.w. £34.3 £46 Total cost per unit 6.18d 47d Total cost per k.w. £43.9 £38.3 Charge light 8d 10(1 Charge heat 3d 2d Charge power 3d 4d Miles of line 240 11