GASWORKS TO CLOSE

Wairarapa Times-Age, 22 October 1940, Page 7

GASWORKS TO CLOSE

POSITION IN GREVTOWN POPULARITY OF ELECTRICITY. ONLY SIXTEEN HOUSES USE GAS FOR LIGHTING. (“Times-Age" Special.) A decision which will have a far reaching effect was arrived at by the Greytown Borough Council at its meeting last night when a resolution was passed to close the gas works on March 31. 1941. The Mayor. Mr A. W. Horton, in moving that the gas report submitted by the Town Clerk, on July 5 be released for publication, said that the position had been brought about through the trend towards "all electrical" homes. The following resolutions were passed:— (1) That all owners and occupiers of premises supplied with gas be notified that the gasworks will be closed on March 31. 1941. and that the supply of gas will be discontinued on that date (2) That all owners and occupiers of premises within 100 yards of a gas main, but not using gas, be similarly notified, as in No. 1 resolution. (3) That the Gas Committee be authorised to have a schedule prepared of all appliances now in use by consumers showing their approximate age and value, and also to work out a system of fair and reasonable compensation to be paid

to the consumer. 1 The Town Clerk was authorised tc employ assistance in the clerical work in connection with the closing of the gasworks. The Town Clerk reported inter alia as follows: —As directed by you I herewith subnlit a report on the gas undertaking. The balance sheet for the year ended March 31. 1940, shows that the undertaking made a loss of £7Bl 13p Bd. I have excluded the grant of £225 from the District Fund account in arriving at this loss. In my opinion the principal cause is the drop in the sales of gas and residuals. In 1930 the net gas sales amounted to £2,222 Is lOd while in 1940 they are £1,223 15s. Sales of residuals in 1930 were £4ll 14s 2d, while in 1940 they are £261 5s 9d, making a total decrease in revenue from the two main sources of £1,148 15s 3d. On the expenditure side the manager's salary, wages, maintenance, materials and distribution in 1930 were £766 Is lid, while in 1940 they are £737 14s 4d. The reason for the small decrease in this expenditure is, I think, due to increased costs of material. Coal, however, cost £B6B 7s 9d in 1930 and £674 6s 3d in 1940. This, however, was to be expected as less gas was produced. The

total decrease in the items mentioned’ is therefore £243 9s Id. The other items of expenditure were much the same in 1930 as they are in 1940. The position of the works is that it is costing more to keep it going than it would cost to close it down. The loss as mentioned is £7Bl 13s Bd, while If the works were closed the total amount ol interest and sinking fund charges to . be met would be £595 17s lOd for the next eight years, after which one of the loans amounting' to £6,000 matures and these charges would then be reduced by £291 15s. The Committee must, however, bear in mind that the works cannot be closed down without sanction of the Government and if this sanction is given, compensation would have to be paid to consumers for appliances, etc. Putting aside the question of closing the works the greatest immediate problem is that mentioned by the Auditor-General, "That the gas works bank account exceeds the limit imposed by Section 3 (2) (c) of the Local Bodies’ Finance Act, 1921/22. The only remedies I can see are: (1) Striking a gas rate sufficient to meet the losses (this would be large); (2) Closing down the works. Summing up the position it will be seen that the chief cause is the lack of use of gas by the ratepayers, a great many of whom have gone over to electricity. The Mayor reported inter alia as follows’—ln company with the Town Clerk I visited Wellington on October 9. We interviewed the Minister of Internal Affairs and also the Minister of Finance. As far as the Minister of Internal Affairs is concerned he informed us that he has no power to stop us from closing the works. The financial position of the works was fully explained to him and he agreed that the whole basis of amicable settlement between the Council and the users of gas, would be reasonable compensation to them and also reasonable time for them to change over to electricity or any other method they wished to adopt in place of gas. We also discussed the extension of the existing gas loans and also the capitalisation ol the overdraft with the Minister of Finance, who referred us to the State Advances Department. The officials o this department do not consider the extension of the £6.000 Gas Loan would save the Council anything as it has only seven years to run and the payments now are mostly off the principal besides which the interest on this loan is only 3 J per cent. We alsc saw Mr M. J. Kennedy, general manager of the Wellington Gas Co. Ltd. who spent a great deal of time on our behalf in endeavouring to secure the services of a temporary manager for the works until they are closed as Mi Whincop had already informed us thm owing to ill health he would not be able to do this work. Securing a manager was not an easy matter owing tc the uncertainty of the period of cm plovmcnt but thanks to Mr Kennedy? efforts. Mr J. Thompson, late manager of the Foxton works has agreed to take the position. I would like the Council to place on record their appreciation of Mr Kennedy’s services and forward him a letter to this 'effect. It was stated that the Greytown gas works had been established in 1907 and for many years were conductec successfully, but since the Wairarapa Electric Power Board commenced operations the output of gas had steadily declined. At the present time only 16 houses used gas for lighting. There are 112 gas cookers in operation and 15 ealephonts. The gas coppers number 6 and fires 26. Only 62 consumers have a gas ring.