THE GAS WORKS.

Manawatu Herald, Volume XXXIII, Issue 1019, 18 July 1911, Page 3

THE GAS WORKS.

IMPORTANT DISCUSSION BY COUNCIL. For some time past it has been known to members ot the Borough Council that the local gasworks are not paying and at recent meetings of the gas committee the question of ways and means of making the works a paying concern had been fully discussed. At the last meeting of tbe Borough Council a report Irom the gas committee recommended that an effort should be made to increase the consumption ot gas and as an inducement for people to use it the committee recommended that gas stoves should be supplied to consumers at cost price and also that connections should be made and fittings supplied on the deferred payment system. A special meeting of the Council was convened for last night to further discuss the matter and there were present : His Worship the Mayor and the whole of the Council with the exception of Cr Greig, who sent an apology for absence on account of indisposition. In opening, the Mayor said he did not propose to trace the matter of the municipalisation of the gas works from the commencement as ratepayers were well aware of the history of the works. The Council purchased the works from the Company for whereas had they erected them in the first place they would not have cost more than A loan of ,£II,OOO was raised, the additional being tor extensions, new retorts, first year's interest, etc. They found now, however, that after paying lor everything there was nothing left for extension ot mains. All that was in hand at present was an amount of about ,£4O. It would readily be seen that it would be impossible to carry out any extensions with this amount and it was imperative that the mains should be extended in order to get a greater consumption of gas, which was the only way to make the works pay. In order to do this it would be necessary to raise a further loan. At the present time the gas works was capable of putting out double the present output for practically the same working expenses as at present — the only additional cost being the coal. He expressed disappointment that the ratepayers had not taken up the matter more enthusiastically than they had done. In October, 1910, the number of meters in use was 140, and at the present time it was 157* aQ n ' crease of only 17. When the works were the property of the Company the argument had been used that ratepayers would not have their bouses connected on account of the works being privately owned, but it was no better now. Had the ratepayers assisted in the manner it might reasonably have been expected they would have done, then the works would now have been a paying concern. At the time the question ot the purchase of the works was placed before the ratepayers it was anticipated that a small rate would have to be collected for the first year or two, and at the last meeting of the Council a rate of 1 in the ,£ had been struck to pay the interest and sinking fund lor the latter half of the current year. At the present time the works were paying everything with the exception of interest and sinking fund —a matter of per annum —and unless the consumption of gas could be largely increased there was every probability of this deficiency having to be met every year. His reason for bringing this matter up in open Council was in order that the ratepayers would knovy exactly how matters stood, as it was entirely in their own hands whether they were going to make the works a paying concern or otherwise. The sole and only reason for the works not paying was the small consumption. Instead of putting out about 7,000 leet of gas per day, as was being done at present, the manager of the works had informed him that 15.000 feet could be manufactured without additional cost other than coal. No mo'e labour and expense would be involved in making 15.000 feet than halt that quantity. He had prepared tables showing the cost of manufacturing the gas for the month ot June, which was the last month, also the receipts for the same month. He had also prepared statements based on an output ol 15.000 feet per day. In these tables he had allowed tor interest only, and not sinking fund. Cost of output 7,000 ft daily. Estimated for one month

This amount is equal to about Ss 2d per 1,000 feet. This high cost of production was entirely due to the small consumption. The revenue for the same month amounted to 3s 6d, leaving a direct loss of t4s per month. And these figures did not allow for sinking fund, work of putting in services, meters, etc.

Cost of output 15,000 ft. daily. Estimate for

This would mean about 4s io l / 2 A per 1,000 feet. The revenue from this would amount to about ,£209 17s 6d, leaving a credit balance o£ ,£74 10s per mouth. This is, of course, exclusive of sinking fund, outside work, meters, etc. From the above figures it would be seen that the whole trouble was that there were not sufficient consumers, and in order to make the works a success the Council must offer inducements to the ratepayers to use the gas. The only way to do so was to raise a further loan for the purpose of extending the mains and putting in fittings and cookers at cost rates on deferred payment. The question had been raised whether we should not reduce the price of gas to induce consumers, but he thought that this was not an opportune time to do this. If the public assisted the Council in making the works payable, which could easily be done, the Council would take the earliest opportunity of reducing the price. It ratepayers would recognise the fact that the works were their own and support them accordingly, there would be no necessity to collect a rate, but if they did not do this it simply meant that they were placing themselves in the position of paying for something they were not enjoying the privilege of, and he felt sure that when they recognised this fact they would do all in their power to make the work a profitable undertaking. Cr Coley agreed that the whole trouble was that the consumption was not big enough. The Mayor, continuing, said he proposed moving that the gas committee go into the matter further and furnish a report as to consumers and new mains required.

Cr Stewart said that there was no doubt that what was required was more consumers. If more mains were laid there would be a big increase in the number of consumers and instanced the Lady’s Mile, where he said practically the whole of the residents would use tbe gas if the mains were laid down that street.

Cr Coley agreed with the Mayor that the only way in which to make the works a success was to get another loan for the purpose of extending the mains. Cr Chrystall suggested a canvass of the borough to ascertain how many new consumers could be obtained. He was of opinion that practically the whole of the ratepayers would take the gas. Cr Speirs asked if the amount mentioned by the Mayor, £4O, left for expenditure was iu addition to the amount the rate struck would provide. The Mayor said that was so. After paying the full year’s interest and sinking fund there would only be about ,£4O left.

Cr Gibbs did not think there was anything to discuss as the positiou was very plain. It meant if the consumption was not increased there would be no profits from the works. If another loan were raised to put down fresh mains and give people gas cookers at reasonable prices then the conwould no doubt go up by leaps aud bounds.

Cr Carter was of opinion that nothing further could be done until a further loan was raised. Very few additional consumers could be obtained until new mains were laid down. It they could not get more consumers then it meant they would have to continue paying ,£7OO every year to pay interest and sinking fund. Cr Adams thought all the present meeting could do was to endorse the Mayor’s proposals. He thought the first step should be to ascertain how much more money was required and then place a loan proposal before the ratepayers. Cr Coley said what was required was a canvasser to find out who would take the gas, and an estimate of the cost of laying new mains in the different streets. Alter a little further discussion the Mayor’s proposal, as follows, was seconded by Cr Coley, and carried unanimously ; That the Council request the gas committee and gas manager to thoroughly go into the matter of likely ex tensions, consumers, meters and gas stores required, with a view of putting the consumption of the gas works on a more profitable footing. The committee to report at the earliest date.

jC S. d. Labour . 26 17 6 Secretary 3 15 0 24 tons coal at 22/6 .. • 25 17 6 Interest • 4i 5 0 Oil, etc., . 2 5 0 Gas for engine , 10 17 6 no 17 6 Less by-products . *3 10 0 £97 7 6

one month. £ s. d. Labour 29 12 6 Interest ... 41 5 0 Oil, etc., 2 ,5 O 42 Tons coal ... ... 47 5 0 Gas for engine ... 15 0 0 135 7 6 Less by-products ... 25 10 0 17 6