Milford chronicle., 1952-01-04
We Present Both Sides On
M'FOrds Pover Controyersary
Those Who Favor Purchase
Of Current

IN last weeks article we mada
the statement: "In order n hniIS
maintain and pay for a power nlant
Witnin its useful life. withmt of-
Iecting present city Operation ~,
enue, the CITY TAX RATE and ~.
CREASED. DN ~
The purpose of this second ar,i.
cle Is to present conservative fac.
'ual data to prove this statemant
Certainly it is reasonable 70 oo
sumo that the city cannot function
with any less income than Is beine
received at present. We migb9,
agree with some who feel that fba
income could have been snent ~
Detter advantage, for desnita tho
/ Lact tnat city has had a net nroet
OF over $500.000 in the mast fSwo
years, from the sale Of purcboso'1
power alone, many of our ~treete
are either in poor repair or unnav-
eu' our sewer system is made
quate 70 say the least, and our
power distribution system ia heine
grossly neglected. It is. tberefore
OBVIOUS that the city cannot aFford
10 sacrifice any portion of its row
ehue TO sentimentality and faIoo
pride of public ownership. Mileord,o
electric business is Big Business
ana as such, must be condnctad
WIN hard-headed business iudg-
ment. jug
An examination of CITY renorts
Tor the past five years reveals that
the profits of our electric franchjso
constltute more than half of the
Guys operating revenue. We will
snow that a municipality OWNED
power plant will affect the profits
10 such an extent that thew car
only be maintained by Increasing
electric rates, or the loss of nroaf
must be made up by increased tax-
1t is a generally accepted fact
that in 1852, Milford will use an
proximately 100000 XVIII of
electric power which can be mr.
chased under the present arrange
ment for about $145,0OO If we add
all other expenses chargeabIe to
the purchased current, this figure
would be raised to about S16O,OOO
In order to produce this mucb
power we would need a plant which
VIII cost approximately 5000 600
"nen the cost OF building erection
labor. foundations, etc. are added
20 the cost of the generating e0uip-
nent. 0H"ip
suppose we analyze the cost of
producing 100000 XVIII of cleo
-rlcity in this plant The cost of
power must include the following
expenses:
l' Retirement Of Indebtedness
Let's assume we are going to nav
or the plant during its useful life
5ased on the experience in our old
'lant' and taking into account the
'apld developments in the power
generation field, the "useful'' life
I the diesel plant will not exceed
D years. With the plant costing
SOO,OOO, this means we must nav
II 9oo'OOO each year for Is years.
. Interest
The interest on the $500 900 debt
I the rate is go, would be S27 OOo
ne hrst year, but since this will
ecrease each year as we pay off
ne principal, we will use the aver
ge interest of $14,4O0 per wear
yer the Is year span as the amount
7e must use in calculating Our
osts. Jul
: Fuel and Lubricating Oils
Using 1871 XVIII per gallon NJ
leseI oil and the present price of
' e cents per gallon, with the ad-
ltlon OF lubricating oil costs and
lectrlc current required for sta
on use, the oil costs will be SS5,-
Labor
Power plant proponents have
ated publicly that the plant would
nploy seven men at $4,000 per
eek and a superintendent at S.
1000 per year. This makes a total
Dor bill of $2S,2OO per year.
Maintenance, Insurance, Etc.
A very conservative estimate of
e cost OF maintenance, insurance.
ID other miscellaneous expenses
+ such plant would be $1O,OOO.OO
II year.
The total of these five items
hich represents the cost Of pro-
icing 100000 XVIII of power in
II own plant, is as follows.