SUPPLY OF ELECTRICITY.

Taranaki Daily News, 19 October 1920, Page 5

SUPPLY OF ELECTRICITY.

j THE GOVERNMENT LICENSE.; NEW PLYMOUTH POSITION EX> '' PLAINED. The license granted by the Goreraient to the New Plymouth Borough Council in regard to supplying electricity,.to tfari* oua districts has now been gazetted,iand in his monthly report the general ian« ager of the Council (Mr. V. T. Bellringer) states that the question haying been finally settled it is. now possible to make public the reasons for the long and protracted negotiations which' took plac# with the Government before finality wai reached.

The report states, inter alia:— Necessity for License.—Before dealint with the negotiations it is necessary ti> first answer the question which naturally presents itself. Why, in view p£ th« fact that the Council lad been granted a license in 1904, and again In 1914, a further license was necessvy in 19201 The reason for this is that tie Ti«frn« grants authority to take a Justified maximum of water from the Waiwakalho Riv'er from a definitely wyfat 'and also specifies the area within whici the Council may erect electric tiMn and sell electric current. Under the bmf scheme it is intended to take the water from a point about a mile higher ufi th* river than the present intake and in slightly larger quantities. With' tU larger output possible under the ne* scheme it is also necessary to have 8 larger area within which to diipoge ot the current. It was clearly necesmy, therefore, to have a freslt, licenje and this left the Council in the position ot making the best terms it could With th# Government.

The principal restrictions and the result finally arrived at In each case are' as follows: Government prior right to purchase: This was a very drastic clause, giving the Government the right to purchase the whole or any part of . the electrical undertaking at a price to be mutually agreed upon, and failing mutual agreement then by arbitration. Nothing was to be allowed for goodwill. Needle** 4 to say, the Council vigorously this clause, the effect of which can bs ; imagined. Eventually, in view the fact that the new license was, in effectj an amendment of the old license, in which no such provision existed, and on this ground alone the clause was entire* ly withdrawn by the Government. Charge for taking water from tlx river.—lt was provided that the OonaoH should pay an annual rental of 2a pel kiloWatt of maximum output over and above the present output of 10(10 kilo, watt. This meant that when tha scheme was fully developed the Council would be called upon to pay £4OO pat annum, although under its existing Il< cense, which has still some 38 yean to run, it could take almost the amount of water lower down tha rival free of charge. Eventually & compr<w mise was arrived at whereby the Couai eil is to pay a minimum of £lO per am mim, the rental to bo la per kilowatt, no charge beyond the minimum to be paid for tho first 5000 kilowatts generated. Maximum charges: The wmyimnp] charges permitted by the draft llsensa were as under. Hetail charges 6d pel unit for lighting and 3d for power And The maximum hag now been fixed at Od per unit for lighting an 4 fourpeuce per unit for power and heati ing, which leaves a reasonable margin. wholesale: The maximum prist Joi bulk supplies was fixed at £l2 par kilo, watt, or approximately £9 par ion* power, Fixing the maximum at thi< low price meant financial ruin 'to thi undertaking, and if it had been ingWted upon the Council would have had'n« option but to have abandoned tie pro< posed extensions. However, the maxi* mum price has/since lain fixed at r £lß per horse-power. Thte maximum i« very low for the early stages of the tan? dertaking and leaves vary little margin in the event of costs increasing to an? f. xte " t: However, it was tie most thai the Department would concede and tha Council had perforce to be satisfied. Duration of license: This" was origin, ally fixed as 42 years from the date oi the Council's previous license, but tha | term is now 42 years from July, Ifeft These were the principal points involved although as may be imagined there were numerous minor matters to be -WW with. Taken altogether the Council hag received a very satisfactory license. The negotiations, were conducted through the Public Works Department, the officials of which accorded the Council ewv courtesy, although naturally they were' keen to drive the best bargain they could for the Government. As will be seen, however, the Council received very important concessions, and the value of these concessions will be more fully realised when at some future time the complete scheme is in opika* tion, *