Ladysmith news-budget. [volume] (Ladysmith, Rusk County, Wis.) 1907-1927, 1917-11-16
tricity of $4,000 year, let us suppose

that we give THESE TWO consumers the
same rate, say four cents per kilOwatt-
hour without any reduction, and that
each consumer is paying for just the
amount of current he is using, let us
suppose that after having served both
these two consumers during a period of
two months, we find, that one is using
$4,000 worth month, while the other
is using only $1,000 worth a month,
this might mean that on the one con-
sumner using $4,000 worth we were
making profit of is per cent of our
investment, while on the other we were
making no profit at all, this would be
out of proportion.
We have here two consumers with
exactly the same size of installation,
we have the same amount of money in
vested on both installations and still
we are making profit of 16 per cent
on one and no profifit at all on the
other, considering the s per cent we
are supposed to make, it seems natural,
that the consumer on which we are
making the large profit, is entitled to
lower rate, while the other on which
we are making no profit, should pay
more.
If anyone buys a pound of sugar, he
naturally pays more per pound than
if he buys a sack of sugar: if anyone
buys a gallon of gasoline, he is charged
more per gallon, than if he buys a
barrel of gasoline, and likewise, the
consumer who b6gs $4,000 worth of
electricity a month, would expect to
pay a higher rate than the one who
buys $4,000 a month.
Now it must be born in mind, that
the railroad commission allows us
net earning of certain percentage on
our investment, this does not mean that
we can serve a small consumer two
kilOwatthOurs a month for 2Oc and lose
money on him, and make so much more
profit on the large consumer and thus
equaliZe the earnings. Everybody
must take his share of the expenses in
proportion to his demand, for this rea-
son it is necessary that the two con-
sumerS in our first example are charged
rate of such a nature, that it auto
matically governs itself to net us a
profit of s per cent. a rate that even If
one consumer uses only two kilOwatt-
hours month, and the other two
thousand, will guaranty us net earn
| ing of s per cent on our investment in
each acSe.
| Now if a man has an installation of
| 100 horse power, which we assume for
us in this case means an investment of
100000, how can he possibly net us
an earning of $4,000 year, if he
pays &c per kilowatthour and uses
only ten kilOwatthOurS month, in
other words how can consumer net
us profit of $4,000 year, when he is
using 40c worth month or $3.50 a
year?
| In order to remedy this condition,
we have what is called ready to serve
charge or what is generally known as
/ a minimum charge.
| In order to be ready to serve. we
must at any time have our plant run
ming. we must have wires of a certain
| size running TO the consumers places,
we must pay an engineer every minute
for operating the plant, we must pay
for water or fuel used in turning the
wheels or engines over whether or not
any power is being used, we must pay
the officers of the company for being
at hand in case anything should happen
during day or night, and besides this,
certain amount of current passes
through each transformer every min
ute during the "a hours of the day, this
is known as the exciting current it
registers only on the meters in the
generating station, not on the consum-
ers' meter, consequently it does not
appear as charge on his bill.
From this it should be clear that if
a consumer pays certain charge every
month. although he may not be using
his motor, he is not paying for the
privilege of having his motors, but he
is paying a ready to serve charge made
up of all the above named expenses.
Now to come back to the present
rates.
| The ready to serve or minimum