Arizona republican., 1916-04-17
RECLAMATION SERVICE ASKS
 FUR OPINIONS LIN CONTRACT

wire that copy of this contract be furnished to the mayor of Phoenix, the Chamber of Commerce and any | organization which has protested [ against the proposition of new con- [ tract being signed with the Reclama tion Service and the company.
 '. When the subject of this new contract was first taken up, from | some sources it was recommended i that money be raised for a municipal plant and the city take action to- ward supplying the people of Phoe- nix from a municipally owned dis tributing system. There is some op position to the Reclamation Service extending the contract with the Pa cific Gas ,& Electric company in such way that would allow exclusive
 right to the use of the power gener- ated by the Reclamation Service be- yond the expiration of their present contract, viz, October l, 1919. The
 new contract is so Worded that these 1 objectionable features do not appear
 as the exclusive right has been elim | mated, and while the company, and through them the consumers in Phoe- | nix, are to receive reduction in
 rate, it would be possible from and
 after October l, 1919, for either the Reclamation Service or the Pacific
 Gas & Electric company to terminate
 the contract, thus leaving the way
 open if municipal distributing sys-
 tenn were started for them to con- tract with the United States for | C., la o;t n,t tIa st,
 stall it's own plant or purchase the plant of the company, and supply it's
 own demands.
 S. Manifestly it is not to the inter-
 ests of the Reclamation Service or the Water Users under the Salt
 River project, to have a steam plant installed in Phoenix by the Pacific
 Gas & Electric company, nor to have
 numerous small power plants in stalled for the development of power
 with Diesel engines or those of sim
 liar make, as the power generated by
 the government system on the pro-
 ject is sufficient to supply all these
 demands, and the money spent for
 the use of electricity would remain , in the valley rather than go outside
 for the purchase of fuel, as would be
 the case if the power were supplied
 by steam.
 9. The records of the Reclamati on Service show that it is possible to
 supply electric power at the rate pro- vided for in the proposed contract
 and still receive substantial profit. In the past the electrical system of the Recla nation Service has been operating with a market the require . ments of which were much below the possible output of the plant In fact [ the system has been very much in the position of large office build
 ing with only few of the rooms : rented, and since the operation and 7 maintenance expenses on the entire power system will remain practically the same whether the output is as at tpresent or if the output is increased to the maximum capacity of the sys tenn.
 10. It seems desirable to reduce the possibility of engine installation 2 by reducing the present price of cleo ] tric current, and at the same time T make it possible for the residents Of $ Phoenix and vicinity. to have more electricity for the money expended The reduction in price will surely in crease the consumption, and by req son of such increase it is anticipated
 that the total returns to the United States under the proposed contrac Il will exceed the amount received dur : ing the preceding year under the ex- 0 isting contract. To have all of thu loon af liphf and nnWer th, = Salt River Valley use the electri, 't current generated by the governmen o power plants is desirable. as it is l. local industry, and if by decreasing e the price it will prevent the installa It ton of gas or steam engine unit It (which when installed would probabl 'i remain in operation several years be $ fore their owners would discover O u admit that it was cheaper to bu from the government than to produc Il power by engines), and thus mak # possible the sale of an increased out T put of electricity by the local hydro III electric plants, it would seem to b u sensible business deal. Decrease i l. cost of electricity to the consumer III means increased consumption and tn 'r natural growth of the city and ad IT jacent country will make the annus er return from the Pacific Gas & Flee le tric Company's contract exceed tha k Of previous years. If new contract nt not made in all probability gas en le zines will be installed, reducing th
 sale of electricity so much that tn Ct returns will be less than in forme ID years.