Perth Amboy evening news., 1919-10-03

present conditions effectfng proposed
commercial service fro mthis plant.
date April %. 1919, In which we ecom
mended the installation of a genera
ting unit smaller than those now in
could 9 served with greater facility and
against Interruption we
were guided y conditions somewhat a
To make our POSITION psrfheoTtly clear.
the following explanation Is offered.
The original appropriation of $780,
TOO;og Was not sp raa to n
ing plant and 1t is open to question
whether 1t would have been the part
of wisdom to make the additional in
had been greater. By this we mean
that to have planned an initial equip
ment sufficient for a very substantial
bling upon a loyalty or the part of con-
sumerS above monetary consideration
n this is not inferring a sordidness
to Perth Annoy citizens greater than
that of any other municipality.
h attitude of antagonism evinced
by the local electric light company dur
ing the campaign preceding the elect
their contest in the Courts to prevent
the establishment of a municipal plant
after the contract for the same had
been awarded. left no doubt in our
minds that unless there were legal OBJ
stacles to prevent it h Company
would engage in a commercial rate war
with the City as soon as the municipal
plant entered this field.
We do not believe tha the spirit of
the laws governing public utilities in
this State would have permitted the
local company to establish in Perth
Amboy a commercial rate lower than
that charged by them for the same SER
vice in other municipalities but with
out a strong Utility Commission the let
ter of the law might e, In some man
ner construct To 6SDeCiaEV except
from the regulation of that ody the
rates in a community where compete
sent of the statutes. Bear in mind that
no privately owned competing company
can be established Except where the
service of the company already in the
field is inadequate or the rates exorbt-
tant) but that the law permits munich
palities to compete and without inter-
ference in the matter of rates by any
State Utility Commission. This fact
the Commission would endorse the
claim that the Utility Laws presup-
posed monopoly and hence the neces-
sity for rate regulation in protection
to he public, but where competitive
conditions were established by law the
necessity and therefore the authority
to regulate rates automatically ceased.
Under such an Interpretation of the
law The local mpan would be free
to cut the commercial rate to q figure
below that of the municipal plant and
OIO LliClL ldICS WlIClo ALI
they would surely embrace the oppor-
tun1ty.
In such an event we do not believe
that civic pride in the municipal plant
would outweigh the desire for the low
est rate whether in Perth Amboy or
any other municipality
We therefore contend that the very
moderate excess capacity in generating
plant available for Commercial service
to have been justified by the uncertain
outcome and that a wise foresight die
tated caution until the municipality. in
a small way, established the character
and dependability of its commercial as
well as its right to protection under the
law from r%uinoqs competition.
If we had a. three (3) unit plant the
City could contract commercial service
for a maximum demand SO large tina
the minimum demand Q. e. the demand
from midnight to 90 ANY would rep
resent a substantial load for one unit,
but with a two (2) unit duplicate plant
you cannot contract a maximum de-
mand for more than half the capacity
of one unit with full assurance against
Interruptions of service and such a
maximum demand does not insure a
SUBSTANTIAL minimum demand
we had proposed a method of opera
ton of one unit which would in our
opinion meet this situation i. e.. by the
operation Of two of the foul cylinders
OF one unit. but were opposed in this
suggestion y the builders of the engine
and we were unwilling to assume sole
responsibility especially as the opera
t1on of these engines had cen attended
win c~ons!deraIe difficulty up to that
time-April, 1919.
|. Various defects in the system of OIL
Ing, piston and crank pin trouble, etc,
caused the periodic shut down of one
unit and until these defects were over
come we considered it ad policy to go
counter to the opinions of the uilder.
We elieve that conditions growing out
of the war have made 1t difficult for the
engine uilder to correct these struc-
tural defects until the present time.
The situation then april. 1919 con-
fronting us offered only one solution If
commercial service was to be Started
and that was in the installation of a.
third generating unit.
Notwithstanding the difficulties ex-
perfenced in the operation of these en-
gfnes the fact emains that your opera
ting force has given municipal street
lighting service since the plant was
ton and vastly superior in point of con-
tlnu1ty, to any street lighting service,
only in Perth Amboy, but in any
other municipality in the state excet
is of similar character.
April, 1919, and the present
time there has beer a decided improve
and we feel that their de%pendabilitv is
now sufficient to warrant inaugurating
commercial service on the small scale
4riglnaIly planned without installing a
third and smaller unit.
II this is done it Will mean uilding
up a load. Y artificial means. to about
70 or o X. W. during minimum demand
periods and during such periods the
cost per unit. of energy supplies will
be greater than normal but the onIv
increase in generating expense during
the time commercial service IS going
through the development stage win be
the excess fuel oil burned during This
minimum load period.
AS soon as the commercial service is
established In the confidence of the
consumer the demand will dictate the
increase In generating capacity and you
VIII not be under the burden of carry
Ing a small unit becoming increasingly
obsolete coincident with the expansion
of the plant.
To put this into tangible
of a unit such as we estimated in ApriI
1919 at $4,000 will be $25.0 900 as ali
element sof cost have increased since
THAT time and the fixed charges (inter-
gs', ns SINGING Hdn fund. ado depreciation) at
me cost of fuel oil. lubricating oil
and kerosine according to the plant rec
ords cost 1 cent per kilowatt hour. If
II taxes a year in which to establish the
commercial service after same is inau-
gurated. the excess cost of fuel oil. Ill
ricating oil and kerosene will be 81
1890 or $1.24S.00 less per year than
the nxed charges or a smaller (third)
unit If installed.
Under these conditions be believe that
the commercial service should be begun
n2Y and that consumers should be
given service as soon as Won have a
connected load of so K. w. maximum
demand
Repairing the damage done to the
generating plant by the South Amboy
explosions must first be made and a
bbepreciation sinking fund should also
fund is established the plant il on a
most unsound financial basis