USA > Massachusetts > Middlesex County > Reading > Town of Reading Massachusetts annual report 1914 > Part 9
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The 7-32 c. p. lamps are connected to the Wilmington and North Reading circuits between the end of the local circuits and the Town line on Lowell and Haverhill Sts.
The above street lighting service if purchased from a private company would cost the Town approximately $12,000 per year.
The amount of current sold for power is also less than a year ago, although the receipts from this source were more, due principally to the fact that a higher average rate was received for the current sold to the Wakefield Plant.
We were unable to make a satisfactory contract to sup- ply the Wakefield Plant with all their requirements for cur- rent and on October 19th they commenced to purchase cur- rent from another source.
The town of Wilmington voted to burn their street lights until one o'clock A. M., instead of until midnight as originally voted, and this has added slightly to our revenue. They also voted to install 86 new street lamps but we were not able to install them this year owing to lack of funds.
The additions and improvements at the power station have already demonstrated that we can generate more economically and the saving will be even more marked as the load increases. The two old boilers are still in use and the Insurance Company allows us the same pressure as on the newer one. They have been in use since the plant started and I expect that we may soon be required to reduce the pressure, which will mean that they will have to be re- placed with new ones. I anticipate, however, that the In- surance Company will give us ample time to make the change when it becomes necessary.
211
In last year's report I recommended the erection of a building on the recently acquired property near the power station to be used as a stock room and a shelter for the horses and wagons, but as it was not thought best to do anything about it this year, we made arrangements for additional room in the basement of the Y. M. C. A. building for storage purposes until such time as we can have a suitable building at the plant.
It is probable that in the near future we can advan- tageously make use of an electric truck for our line work in place of the horses. This has recently been done by at least three of the municipal plants with apparent success, and I recommend same for your consideration. The probable cost of a suitable truck would be about $2,000.
The work of renewing defective poles and wires has been continued during the year, and I believe that during the coming year it will be wise to expend fully as much money in this part of the plant as has been expended dur- ing 1913.
The records at the office show that the following house- hold appliances have been connected during the past year : 109 flat irons, 4 ranges, 11 heating pads, 61 toasters and small stoves, 3 hair dryers, 4 vibrators, 2 curling irons, 10 fans, 2 radiators, 4 vacuum cleaners and 7 washing machines. We have also connected 29 motors for various purposes, totalling 41.7 H. P., and 2 electric drills.
The following tables show data from the records at the office, and are followed by the financial report and estimate for 1915 :
LYNNFIELD EXTENSION
Total number of customers Dec. 31, 1914 70
Total number of commercial lamps connected 1,547
Total number of 32 candle street lamps connected 64
Total horse power in motors 12 1-2
Total investment to Dec. 31, 1914 $9,257 79 ·
Total earnings for the year . . .
$2,255 29
212
NORTH READING EXTENSION
Total number of customers Dec. 31, 1914 . 90
Total number of commercial lamps connected 1,829
Total number of 32 candle street lamps connected 211
Total horse power in motors . 14
Total investment to Dec 31, 1914 . $24,457 46
Total earnings for the year .
. $5,480 06
WILMINGTON EXTENSION
Total number of customers Dec. 31, 1914 .
124
Total number of commercial lamps connected 1,933
Total number of 32 candle street lamps connected 255
Total horse power in motors
29 1-6
Total investment to Dec. 31, 1914 . $29,386 73
Total earnings for the year . ·
. $6,549 13
TABLE SHOWING DATA FROM THE RECORDS OF THE PLANT
Kilowatt hours manufactured 986,476
Kilowatt hours used on street lights 187,590
Kilowatt hours sold to Wakefield plant 105,758
Kilowatt hours sold to Reading consumers .
372,698
Kilowatt hours sold to No. Reading consumers
40,169
Kilowatt hours sold to Lynnfield consumers
14,718
Kilowatt hours sold to Wilmington consumers
45,366
Kilowatt hours used at station and office
15,283
Kilowatt hours unaccounted for
204,894
Coal used, tons ·
2,229
Average cost of coal per ton
$4.107
Carbons used
677
Globes used .
72
Incandescent lamps renewed free 2,699
60-candle power Tungsten street lamps installed 32-candle power Tungsten street lamps installed 250-candle power Tungsten street lamps installed Arc lamps removed 89
91
17
78
213
New poles added .
335
Old poles renewed
89
Feet of wire added
87,146
Feet of wire renewed
13,228
Incandescent lamps connected
2.746
Motors connected .
29
New services installed .
190
CONNECTED LOAD DECEMBER 31, 1914
Total number of customers .
1.390
Total number of incandescent lamps (approx.)
29,937
Total horse power in motors
313.7
Total number of Tungsten street lamps
993
TABLE SHOWING EARNINGS OF LIGHT AND POWER FOR FIVE YEARS
LIGHTS
Total
1910 $23,876.50 3,174.25
1911 $30,217.13
1912 $31,772.66
1913 $39,472.00
1914 $44,496.50
Discount
4,190.06
2,861.18
3,365.99
3,404.39
Net
$20,702.25
$26,027.07
$28,911.48
$36,106.01
$41,092.11
POWER
Total
$4,984.78
$5,312.91
$8,321.36
$8,639.16
$8,783.49
Discount
18.16
22.58
60.91
80.47
75.85
Net
$4,966.62
$5,290.33
$8,260.45
$8,558.69
$8,707.64
NET TOTAL LIGHT AND POWER $25,668.87 $31,317.40
$37,171.93 $44,664.70
$49,799.75
·
214
CASH ACCOUNT DR.
Jan. 1, 1914, to balance . $19,272 33
To appropriation for bond payments . 4,500 00
To appropriation for construction 2,932 07 To appropriation for new street lights 1,200 00 To proceeds of Wilmington construc- tion bonds 1,000 00
To proceeds of new construction bonds
8,000 00
Receipts from customers
53,248 04
Receipts from N. E. T. & T. Co., poles and labor 472 64
Receipts from sale of poles
3 50
Receipts from reels returned
20 00
Receipts from sale of serap
274 91
Sundry receipts .
97 24
Interest received on bank balance
138 70
Accrued interest on bonds
13 00
Petty cash .
100 00
$91,272 43
CR.
By cash paid for the following accounts :
Electric plant
$1,524 79
Real estate
71 27
Steam plant .
20,682 89
Lines £ 698 71
Incandescent street light fixtures 328 89
Meters .
2,259 30
Transformers
1,011 07
Lynnfield Extension
459 88
North Reading Extension
775 15
Wilmington Extension
1,511 70
Fuel
10,669 20
Oil and waste
437 06
Water
118 60
215
Station wages
$8,140 67
Repair of real estate
300 96
Repair of steam plant .
1,083 93
Repair of electric plant
117 01
Station tools and appliances
426 46
Repair of transformers
195 65
Repair of lines and lamps
3,163 79
Carbons
66 06
Incandescent lamps
3,773 96
Globes .
66 16
Distribution tools and appliances
95 88
Distribution wages
1,421 66
Repair of meters .
119 35
Pole line rental
98 67
General salaries
3,312 08
Board expenses
87 38
General office expenses
1,260 26
Advertising and printing
135 85
Rent of office
391 25
Taxes
204 00
Insurance
2,147 19
Interest
4,400 64
Bonds
6,500 00
Notes
2,500 00
Stable expenses
895 13
Stable fixtures
14 00
Jobbing material .
3,130 15
Stock
4,251 07
Commissioners' salaries
225 00
Petty cash
100 00
Legal expenses
50 00
Office furniture
36 36
Automobile expenses
480 50
$89,739 58
Balance Dec. 31, 1914 . 1,532 85
$91,272 43
216
SUMMARY OF CASH RECEIPTS AND EXPENDITURES FOR THE YEAR
DR.
Balance Dec. 31, 1913 $19,272 33
Appropriation for bond payments ·
4,500 00
Appropriation for new street lights . 1,200 00
Appropriation for construction . 2,932 07
Receipts from customers
53,248 04
Interest received
151 70
Sundry receipts .
968 29
Proceeds Wilmington construction bonds .
1,000 00
Proceeds bonds for construction
8,000 00
$91,272 43
OR.
Cash paid for construction . $29,323 65
Cash paid for bonds .
6,500 00
Cash paid for notes
2,500 00
Cash paid for interest
4,400 64
Cash paid for Commissioners' salaries 225 00
Cash paid for maintenance accounts
44,439 10
Cash paid for insurance
2,147 19
Cash paid for taxes
204 00
$89,739 58
Balance Dec. 31, 1914
1,532 85
891,272 43
217
SPECIAL CONSTRUCTION CASH ACCOUNT
Balance Dec. 31, 1913
$18,467 50
Construction cash used
4.115 16
$22,582 66
Expended for steam plant
$17,233 45
Expended for electric plant
5,221 38
Expended for real estate .
127 83
$22,582 66
OPERATIONS FOR TWELVE MONTHS ENDING DECEMBER 31, 1914
EXPENSE
MANUFACTURE :
Fuel
$9,154 92
Oil and waste
323 43
Water .
59 90
Station wages
8,140 67
Repair of real estate
244 53
Repair of steam plant .
723 28
Repair of electric plant
142 01
Station tools and appliances
225 29
$19,014 03
DISTRIBUTION :
Distribution wages .
$1.437 38
Repair of lines and lamps
3,461 34
Carbons
22 75
Incandescent lamps
2.433 74
Globes .
2S 25
Distribution tools and appliances
105 21
Repair of meters .
99 75
Repair of transformers
196 40
.
$7,784 82
218
MISCELLANEOUS EXPENSES :
General salaries .
$3,312 06
Board expenses .
138 38
Commissioners' salaries
225 00
General office expenses
1,150 85
Rent of office
397 50
Advertising and printing
89 00
Stable and automobile expenses
1,271 31
Insurance
1,810 28
Taxes .
204 00
Pole line rental
98 67
$8,697 05
$35,495 90
Gain in operating
14,303 85
$49,799 75
INCOME
Commercial light, less discounts $9,719 96 .
Domestic light, less discounts .
23,802 28
Commercial power, less discounts
5,358 54
Power sold to Water Works
308 10
Power sold to Wakefield
3,041 00
Lighting Municipal buildings
402 86
Street lighting, No. Reading
2,831 66
Street lighting, Wilmington
3,626 96
Street lighting, Lynnfield
708 39
$49,799 75
PROFIT AND LOSS ACCOUNT DECEMBER 31, 1914
DR.
Deficit Jan. 1, 1913
. $34,887 51
Interest paid
4,453 33
Depreciation
6,051 08
$45,391 92
219
OR.
Jobbing income .
$224 40
Stock .
85 76
Rent of poles
342 28
Interest on bank balances .
138 70
Gain in operating
14,303 85
$15,094 99
Deficit Dec. 31, 1914 .
30,296 93
$45,391 92
STATEMENT, DECEMBER 31, 1914
ASSETS
Real estate
. $11,654 42
Steam plant
31,124 88
Electric plant
17,911 57
Lines .
. 73,805 33
Incandescent street lights
9,266 61
Meters
14,551 07
Transformers
9,187 96
INVENTORY :
Fuel
2,623 58
Station tools and appliances
814 90
Oil and waste
26 97
Jobbing supplies
2,517 58
Line material
1,874 13
Incandescent lamps
740 01
Repairs steam plant
252 19
Repairs electric plant
100 00
Repairs of lines .
141 34
Horses, wagons, auto, etc.
1,419 72
Distribution tools and appliances
516 43
Office supplies
299 07
Office furniture
889 72
Unexpired insurance .
521 29
Cash in Town Treasury construction account .
1,399 32
220
Cash in Town Treasury maintenance account
$133 53
Cash in Mechanics' Savings Bank (customers' deposits ) .
1,549 74
Accounts receivable (manufacturing) 8,225 64
Sundry accounts receivable 360 13
$191,907 13
Profit and loss deficit
30,296 93
$222,204 06
LIABILITIES
Bonds payable . $83,000 00
Notes payable
. 23,000 00
Appropriations for bond payments .
42,513 00
Appropriations for note payments .
22,000 00
Appropriations for construction ·
36,623 30
Overdraft for construction
3,211 64
Customers' deposits .
1,549 74 .
Interest accrued, not due .
1,186 47
Accounts payable, maintenance
· 9,119 91
$222,204 06
CONSTRUCTION ACCOUNT
DR.
Cost of plant as shown in Town Report
Dec. 31, 1913
$202,548 81
Real estate
$127 83
Electric plant
5,221 38
Steam plant ,
17,233 45
Lines .
3,883 17 ·
Incandescent street lamps
2,354 39
Meters
1,557 51
Transformers
583 04
$30,960 77
Cost of plant Dec. 31, 1914
.
$233,509 58
221
CONSTRUCTION CASH ACCOUNT
DR.
Balance Dec. 31, 1913 $18,467 50
To appropriation for new street lights 1,200 00
Appropriation for construction 2,932 07
Proceeds Wilmington construction
bonds
1,000 00
Proceeds bonds for construction
8,000 00
Depreciation cash used for con- struction
3,692 59
- $35,292 16
CR.
By amount paid for real estate . $127 83
Amount paid for electric plant
5,221 38
Amount paid for steam plant
17,233 45
Amount paid for lines .
3,883 17
Amount paid for incandescent street lights . 2,354 39
Amount paid for meters
1,557 51
Amount paid for transformers
583 04
Amount paid for accounts payable 1913
2,932 07
$33,892 84
Balance Dec. 31, 1914
1,399 32
$35,292 16
WILMINGTON EXTENSION CASH ACCOUNT
Bond issue for Wilmington Extension $20,000 00
Expended 20,000 00
222
ADDITIONAL TUNGSTEN STREET LIGHTS
Appropriation
$1,200 00
Construction cash used
1,154 39
Expended
$2,354 39 $2,354 39
DEPRECIATION CASH ACCOUNT
Appropriation from earnings $6,051 08
Amount used for construction acct. . $3,692 59
Amount used for renewal of lines 2,358 49
$6,051 08
LYNNFIELD EXTENSION
TOTAL INVESTMENT TO DEC. 31, 1914 :
Lines .
$6,982 08
Incandescent street lights 692 65
Meters .
995 94
Transformers
587 12
$9,257 79
NORTH READING EXTENSION
TOTAL INVESTMENT TO DEC. 31, 1914 :
Electric plant
$440 12
Lines
20,528 39 ·
Incandescent street lights . ·
1,517 13
Meters .
1,144 83
Transformers
826 99
$24,457 46
WILMINGTON EXTENSION
TOTAL INVESTMENT TO DEC. 31, 1914 :
Electric plant
$627 18
Lines
24,523 10
Incandescent street lights
1,572 85
Meters
1,295 40
Transformers
1,368 20
$29,386 73
223
In accordance with the requirements of Section 114 of Chapter 742 Acts of 1914, I submit the following estimate for the year ending Dec. 31, 1915.
EXPENDITURES :
For operation, maintenance and
repairs . . $34,786 19
For interest on bonds and notes 4,408 13
For depreciation fund (3% on $232,409 58) . .
6,972 28
For note payments
2,500 00
For bond payments
7,000 00
For loss in preceding year
4,950 32
$60,616 92
INCOME :
From sales to private consumers $48,916 92
From miscellaneous items . 700 00
$49,616 92
Balance
$11,000 00
FOR NEW CONSTRUCTION :
Reading
$4,000 00
And balance on hand Dec. 31,1914 1,399 32
$5,399 32
North Reading, Wilmington and
Lynnfield Centre . 12,000 00
Total
$17,399 32
Total to be appropriated
$28,399 32
Respectfully submitted,
ARTHUR G. SIAS, Manager.
224
APPENDIX A
TABLE SHOWING AMOUNTS RAISED AND APPROPRIATED FROM TAX LEVY FOR MAINTENANCE AND CONSTRUCTION PUR- POSES FROM 1900 To 1914 INCLUSIVE
Appropriations for Mainte- nance, Interest, Depre-
ciation and Payment of Bonds and Notes
Appropriations for Con-
struction
Appropriations for Addi-
tional Street Lights
Total Appropriations for
All Purposes
1900
$9,401.50
$1,500.00
$165.00
$11,066.50
1901
9,833,50
1,500 00
135.00
11,468.50
1902
8,644.00
2,500.00
11,144.00
1903
10,905.00
3,000.00
13,905.00
1904
10,905.00
2,099.34
13,004.34
1905
7,815.00
3,000.00
10,815.00
1906
9,307.00
9,307.00
1907
8,465.00
8,465.00
1908
8,225.00
8,225.00
1909
10,725.00
10,725.00
1910
10,000.00
270.00
10,270.00
1911
5,800.00
1,000.00
6,800.00
1912
5,000.00
4,000.00
1,500.00
10,500.00
1913
6,000.00
3,826.19
1,250.00
11,076.19
1914
4,500.00
2,932.07
1,200.00
8,632.07
225
APPENDIX B THE COMMONWEALTH OF MASSACHUSETTS IN BOARD OF GAS AND ELECTRIC LIGHT COMMISSIONERS
BOSTON, Oct. 6, 1914.
READING PETITION
This is an application by the Municipal Light Board and the manager of the Municipal Light Plant of the town of Reading, asking that this Board consent to certain prices for electricity alleged to be less than cost as defined in section 22 of chapter 34 of the Revised Laws (now section 115 of chapter 742 of the Acts of the year 1914).
After due notice a public hearing thereon was held in Reading.
The town owns an electric plant which it has operated since 1895. By authority of special legislative acts it is distributing and selling electricity in North Reading, Lynn- field and Wilmington, and to the municipal plant at Wake- field. The last-named town, however, has recently con- cluded an agreement for the purchase of its electricity from the Edison Electric Illuminating Company of Boston.
The prices alleged to be less than cost are as follows on monthly bills :-
For power : 200 kilowatt hours or less, 8 cents per K. W. H.
From 201 to 300 kilowatt hours, 7 cents per K. W. H. 301 to 400 kilowatt hours, 6 cents per K. W. H. 401 to 500 kilowatt hours, 5 cents per K. W. H. 501 to 750 kilowatt hours, 42 cents per K. W. H. 751 to 1,000 kilowatt hours, 4 cents per K. W. H. 1,001 to 1,500 kilowatt hours, 32 cents per K. W. H. 1,501 to 10,000 kilowatt hours, 3 cents per K. W. H. Over 10,000 kilowatt hours, 22 cents per K. W. H. For cooking and heating: current used for cooking and heating, when metered separately, 4 cents per kilowatt hour, with discount of 10 per cent. if paid on or before the 15th of month following the date of the bill.
To town of Wakefield : 3 cents per kilowatt hour for all electricity used during peak hours ; 2 cents per kilowatt hour for all electricity used during non-peak hours. Yearly guarantee of 400,000 kilowatt hours at above rates.
To water department of Reading : 2 cents per kilowatt hour.
226
For the reason already stated any question as to the Wakefield rate has been eliminated, and there seems to be no occasion for any action by the Board with respect to it. The other prices under consideration have been, for the most part in force for several years, and the question raised by this application is not as to the propriety of the estab- lishment of new prices, but rather as to the continuance of those now in force. At the hearing it appeared that a sharp difference of opinion had arisen as to the policy pursued and to be pursued in the conduct of the plant's business. The advisability of having entered upon the supply of electricity in other towns was questioned. Doubt was expressed as to whether the plant investment had not increased more rap- idly than was justified in the interest of the town, and the sale at so low rates of so much electricity in proportion to the total output was criticised. It seemed, also, to be con- ceded by all that the electricity furnished to the town for street lights was not paid for by the taxpayers at cost as defined by the statute.
These different views, while urged with some warmth, were evidently prompted by a sincere desire to serve the best interests of the town in the conduct of the business. Some of the questions raised, however, as to the amount of investment and the extent of territory which the plant shall serve, seem to have already been conclusively settled by the town under specific legislative authority. This fact and the advantages thus far to Reading, as well as the benefits to the municipalities and private consumers in the adjacent territory, make any criticism by the Board at this time of the town's course unnecessary and inexpedient. But the law prescribes a maximum and minimum limit to the prices which the manager and Municipal Light Board may fix, and specifically forbids a price less than such minimum without the written consent of this Board. The issue, there- fore, in this case is not as to the reasonableness of the dif- ferent prices already established, or even as to their fair- ness as between different customers or groups of customers,
227
but rather as to the expediency of consenting to certain prices which are less than cost as defined by the statute.
Before discussing the facts which are pertinent to this issue, it seems desirable to point out that the language of the statute prescribes explicitly the method for determining cost. It must include all operating expenses, interest on the plant investment at the rate paid upon the debt incurred therefor, the maturing debt requirements and depreciation reckoned at not less than 3 per cent. upon the cost of the plant: all electricity used by the town must be charged at cost. In applying these requirements to the fixing of a price the Legislature apparently intended by the term "cost" the average cost computed upon the total units of kilowatt hours delivered for all uses. Such interpretation necessarily gives no consideration to any differences in cost, which may exist between customers or groups of customers, growing out of differences in character or conditions of supply. If such differences, which are not uncommon, result in actual and substantial differences in cost, the statutory requirement becomes so entirely arbitrary as to have compelled the Leg- islature to recognize that some departure from the strict interpretation of the rule laid down may be made with ad- vantage to both the public and private interests involved.
It is characteristic of the supply of electricity for light that, relative to the amount demanded, the average use is but for a short period of the dark hours of the day. On the other hand, it is characteristic of the supply of electricity for the production of mechanical power or in manufacturing that the average use is for a considerable period of the day- light hours. The use of electricity for lighting is, of course, large during the short days and small during the long days of the year, while its use for power is comparatively steady throughout the year. Because of these characteristics it is generally agreed that, broadly speaking, the unit cost of electricity delivered for power is usually materially less than that delivered for light, and this difference has been
228
made the justification for lower prices for power than for light, notwithstanding the great difficulty, perhaps impossi- bility, of accurately demonstrating the actual difference in cost for any individual customer. For this reason, and be- cause of the fact that customers for power can readily supply themselves in other ways, power prices have doubtless been often determined by what the manager of a plant thought could be charged and command the business rather than by any very definite analysis of costs. Unless prices thus made are unreasonably low, the increased output secured, if with- out a corresponding increase of investment, has a tendency to decrease average unit costs, with resulting reductions in prices for light.
The prices for power, which have already been quoted, are concededly less than cost as defined by the statute, with the possible exception of the base price and one or more of the higher figures in the schedule, at which rates little, if any, electricity is likely to be sold. From the standpoint of the power customer they may not be low. If electricity for power is to be sold at all, prices as low as those in the sched- ule must probably be continued. As a matter of fact, under them the output for power has been substantially increased, and, although their full effect may not yet be realized, it has apparently been of advantage to the business as a whole. Under such circumstances the Board is reluctant to with- hold its consent to the prices established for power. But in making this statement the Board, for reasons already given, does not assume to consider the schedule in detail, either with respect to the expediency of its items severally or its fairness as between different power customers. It may also be proper to add that the lowest rate offered under this schedule shows little, if any, margin over the bare manu- facturing cost of the current, and therefore the management is bound to watch over the development of the power busi- ness and the effect of such rates upon the entire operation of the plant with especial care, in order that no electricity
229
shall be sold at an actual loss and an undue burden be thus imposed upon the taxpayers or any class of customers.
The question with respect to the heating and cooking rates is similar. It appeared that comparatively little elec- tricity has been sold under this rate, and it is quite evident that no electricity would be sold for this purpose at a rate as high as the cost computed under the statute. In fact, the price at which electricity can be sold for this purpose seems to have little to do with its cost, but depends rather upon its value to the customers. Moreover, because of the circumstances of its use for this purpose, it may under some conditions be furnished materially below cost, as defined in the statute, without actual loss to the plant. The propriety of trying to obtain this class of business involves at the out- set largely considerations of commercial expediency. Up to the present time the volume of the business under this rate appears to have been too small to have had any material effect either on the operations of the plant or its revenues. If it results in increasing output without proportionately in- creasing investment, the experiment will in a measure be justified. There was some indication at the hearing that this rate had been allowed for the use of irons and other small heating and cooking devices. While probably few will avail themselves of the rate for this purpose because of the minimum charge, it is doubtful whether commercial necessity or expediency requires other than regular rates for such devices in cases where the volume of such business is relatively small.
The pumping rate of 2 cents allowed to the water de- partment of the Town raises a different issue. Manifestly it is less than cost, as defined by the statute. For that matter it yields no more than the bare cost of producing the electricity supplied for this purpose. The same section of the statute, under which this case is brought and which provides that the "price" at which current is sold may be fixed at less than cost as there described (with the per-
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