DOCUMENT I S THE PROPERTY OP HIS BRITANNIC MAJESTY S GOVERNMENT.
5
30
C A B I N E T .
2Tj
o f t h e CoiamSttee a p p o i n t e d t o r e v i e w
t h e N a t i o n a l ' P r o b l e m of t h e , S u p p l y
of E l e c t r i c a l Energy.
Report
264/85.
I
circulate
herewith,
for
the
information
of
o f t h e C a b i n e t , a copy o f t h e R e p o r t o f t h e C o m m i t t e e
to review the National P r o b l e m o f ' t h o Supply o f
Energy
members
appointed
Electrical
o f whioh Lord W e i r o f E a s t w o o d w a s C h a i r m a n a n d t h e
o t h e r members were Lord P o r r e s
I also c i r c u l a t e
a
and
S i r Hardman
covering l e t t e r
Lever.
whioh
Lord W e i r
a d d r e s s e d t o me w i t h t h e R e p o r t ,
(Sgd.)
WILFRID ASHLEY,
2 5 t h May, 1 9 2 5 .
M I N I S T R Y OF TRANSPORT,
6, W h i t e h a l l Gardens-,
S.W.I.
20th
May,
19535.
Sir,
I n - t r a n s m i t t i n g o u r R e p o r t on t h e s u b j e c t o f
electricity,
we d e s i r e t o d r a w y o u r a t t e n t i o n t o t w o p o i n t s w h i c h we
consider
o f i m p o r t a n c e , b u t w h i c h we t h i n k c a n b e b e t t e r d e a l t w i t h i n a
l e t t e r than In the body of the
Report.
(1)
An e s s e n t i a l p r e l i m i n a r y t o t h e c o n s t r u c t i o n o f
the
"gridiron" w i l l be the making of a complete e l e o t r i c a l
survey
o f t h e w h o l e a r e a , w h i c h we a r e a d v i s e d w i l l t a k e s o m e s i x
months,
As t h e " g r i d i r o n " o r g a n i s a t i o n c a n n o t b e f o r m e d
p r i o r t o l e g i s l a t i o n , a n d we u n d e r s t a n d t h a t t h e
Electricity
Commissioners cannot spare the s t a f f t o carry out thie important
work, i t f o l l o w s t h a t t h e r e must be a d e l a y of some months
after
the n e c e s s a r y l e g i s l a t i o n has b e e n p a s s e d b e f o r e the
constructlon­
a l work on t h e " g r i d i r o n " can be commenced.We h a v e c o n s i d e r e d w h e t h e r i t w o u l d
expedient to avoid the loss of this
time.
be
possible
or
Our p r o p o s a l s , i f a c c e p t e d , w i l l g i v e a l a r g e amount o f
employment, and,we are of opinion that i t would b e n e f i t
the
n a t i o n a l s i t u a t i o n i f t h i s e m p l o y m e n t c o u l d b e made
available
at the e a r l i e s t p o s s i b l e moment.
F u r t h e r we f e e l b o u n d t o p o i n t o u t t h a t , w h a t e v e r
decision
t h e G o v e r n m e n t m a y r e a c h o n o u r r e c o m m e n d a t i o n s a s a w h o l e , we
b e l i e v e that any p o s s i b l e remedial scheme f o r B r i t i s h
Electricity
must I n c l u d e t h e p r o v i s i o n of t h e " g r i d i r o n " as a p h y s i c a l
entity.
We t h e r e f o r e s u g g e s t t h a t , i n a n t i c i p a t i o n o f
approval
and c o n c u r r e n t l y w i t h t h e p r e p a r a t i o n o f n e c e s s a r y
legislation,
the M i n i s t e r of Transport should be a u t h o r i s e d t o take the
n e c e s s a r y s t e p s t o put t h i s s u r v e y i n hand i m m e d i a t e l y ao t h a t
t h e C e n t r a l E l e c t r i o i t y B o a r d may b e i n a p o s i t i o n t o
commence
c o n s t r u c t i o n a l work d i r e c t l y i t i s
created.
We s u g g e s t t h a t t h e s u r v e y s h o u l d b e c a r r i e d o u t
under
the g e n e r a l guidanoe of the Advisory Expert Committee
(viz
M e s s r s . C.H. M e r a , J,M, Kenedy a n d S . L . P e a r c e , w i t h S i r J o h n
S n e l l a s C h a i r m a n ) who s h o u l d l a y down t h e g e n e r a l l i n e s o f
the
survey in accordance w i t h the T e c h n i c a l Scheme prepared by
S i r John S n e l l .
We r e o o m m e n d t h a t , t h e s t a f f s o f t w o o r t h r e e
l e a d i n g firms of c o n s u l t i n g e l e o t r i c a l engineers should be
e m p l o y e d and we s u g g e s t t h a t t h e m o s t o b v i o u s g e n e r a l
policy
woulOf b e f o r e a c h f i r m t o b e r e s p o n s i b l e f o r a d e f i n e d a r e a .
(2)
i n o u r R e p o r t we p o i n t o u t t h a t t h e e x i s t e n c e o f
the
" g r i d i r o n " w i l l r a d i c a l l y a l t e r t h e p o s i t i o n as r e g a r d s
the
p o s s i b i l i t i e s o f t h e e l e c t r i f i c a t i o n o f r a i l w a y ^ , a n d v/e
recommend t h a t s t e p s s h o u l d be t a k e n t o ensure t h a t
railway
e l e c t r i f i c a t i o n i s r e v i e w e d and r e c o n s i d e r e d .
We h a v e n o t g o n e - f u r t h e r t h a n t h i s p a r t l y b e c a u s e
the
m a t t e r i s s t r i c t l y o u t s i d e ouc* fcenroa o f r e f e r e n c e , a n d p a r t l y
b e c a u s e w e £eel
t h a t a n y more d e f i n i t e r e c o m m e n d a t i o n i n a
document l i k e l y t o b e p u b l i s h e d m i g h t have t h e ex"fect of
r e s t r i c t i n g the a l t e r n a t i v e s open to the
Government.
.
C o l . The R t . Hon. W i l f r i d
Ministry of
Transport,
VJhit s h a l l ,
S.W.I.
Aghlay,
M, P . ,
We d e s i r e , h o w e v e r , t o r e c o r d o u r o p i n i o n t h a t a
Committee s h o u l d be at once appointed t o i n v e s t i g a t e
the
whole q u e s t i o n of the e l e c t r i f i c a t i o n of r a i l w a y s ,
including
the c a p i t a l i n v o l v e d and the economies which would r e s u l t .
I
am, S i r ,
Your o b e d i e n t
(Signed)
Servant,
WEIR,
Chairman.
MINISTRY OF TRANSPORT.
Confidential.
REPORT
OF THE
Committee appointed to review the National
Problem of the Supply of Electrical Energy.
MINISTRY OF TRANSPORT.
Confidential.
REPORT
OF THE
Committee appointed to review the National
Problem of the Supply of Electrical Energy.
Members of the Committee.
THE EIGHT HON. L O R D W E I R O F E A S T W O O D
(Chairman).
THE RIGHT HON. L O R D F O R R E S O F G L E N O G I L .
SIR S. H A R D M A N L E V E R , BART., K . C . B .
MR. 0 . A .
SHERRARD
(Secretary).
Technical
Adviser.
SIR J O H N S N E L L , M . I N S T . C . E . , M . I . E . E .
REPORT.
To the Right Hon. Lt.-Col. WILFRID ASHLEY, M.P.,
Minister of Transport.
P A R T I.
SIR,
1. Terms of Reference.-We were appointed in January of this year to
review the national problem of the supply of electrical energy and to present a
report on the broad lines of policy which should be adopted to ensure its most
efficient and effective development.
2. Introduction.—The position of the electrical supply in Great Britain
was very thoroughly and completely investigated in 1918 by the Electric Power
Supply Committee under the Chairmanship of Sir Archibald Williamson, Bart,
(now Lord Forres), following upon the work of several earlier committees. This
fact has absolved us from the necessity for tracing in detail the early history,
legislative and otherwise, of the causes which have led to the present position.
3. We have, however, enjoyed one advantage which was denied to our
predecessors, While they took the evidence of many expert witnesses, technical,
administrative and commercial, besides hearing the representatives of diverse
interests, they were necessarily deprived of the assistance and experience of the
body which they themselves brought into existence—the Electricity Commis­
sioners. Whatever may be the position of electricity here compared with other
countries, Great Britain is unique in having a body of men who, for over five
years, have devoted their entire energies, their patience and their technical
and administrative ability to investigating the detailed conditions of this industry
and public service throughout the country. The Commissioners, in fact, have
functioned as an expert committee carrying out a continuous investigation. The
results of their endeavours and experience have been at our disposal.
4. The subject is complex, entailing a mass of technical, administrative
and legislative considerations. In order, therefore, that a proper sense of
proportion might be preserved, we felt it essential to adopt some one central
objective at which to aim. The terms of reference, the necessities of the case,
and the whole course of our investigations have led us to adopt, as this definite
goal, the reduction in price and the greatest availability of electrical energy
to the consumer, ranging from the largest industrial user to the artisan in his
home. We felt that if this was kept steadily in v i e A v , individual and local
interests would fall into their proper place.
5. Regarding the matter from this view-point of the needs of the country
as a whole, we find a great consensus of expert opinion, with which we fully
and entirely agree, that Great Britain is undoubtedly favourably placed as a
potential producer and distributor of cheap electrical energy. We lay stress on
this point owing to the very prevalent impression that there are many countries,
more especially those with large sources of water power, with which Great
Britain cannot compete. In our opinion this view is an exaggeration which is
likely to encourage the inadequate methods now employed and prevent expansion
on a better system.
6. In the broadest sense, it cannot be denied that while the influence of
the Electricity Commissioners during the last five years has been good, their
powers have been inadequate to produce effective results; and our review confirms
the opinion of the earlier Committee, that, generally speaking, we are still
to-day neither generating, transmitting nor distributing electrical energy as
cheaply as we might, nor are we consuming electrical energy to anything like the
same extent as other highly civilised industrial countries.
V. We are also bound to add, without necessarily subscribing to-day to the
exact recommendations of the earlier Committee, that if effective legislative action
had been taken on the general lines of the recommendations of the Williamson
Committee, very substantial savings would have been made. Electricity would
nave been cheaper, and our task would have been infinitely easier and possibly
unnecessary.
8. We have been greatly impressed by the time element involved in this
subject, and regard it as a dominating factor. Great expenditure is being
mcurred in many directions, and as in our view that expenditure is not being
52561
A
2
employed to the best advantage, not only is waste taking place, but further
obstacles are being placed in the way of rapid and efficient development along
the right lines. Accordingly, any change in direction and method must be made
at once if it is to be fully effective.
9- Present Position.—The fundamental data representative of the present
position, as shown by the latest figures available, are set out in the following
table, to' which frequent reference will be made.
-
TABLE I .
A uthorised Undertakings with Supply Powers :
Local Authorities
...
...
...
Electricity -Companies
...
...
Power Companies
...
...
...
...
...
...
...
335
209
28
...
...
572
Generating Stations owned by A uthorised Undertakings :
Local Authorities
...
...
...
...
...
Companies
...
...
...
...
...
...
248
190
Total
...
...
...
Total
...
...
...
. . . . . .
...
438*
Capital Invested:
(a) Local A utkorities—'
£
49,360,000
On generation
On distribution and other items ...
...
54,120,000
Total
103,480,000
(6) Companies—
On generation
£
24,320,000
On distribution and other items
33,950,000
Total
58,270,000
(c) Total Capital
Expenditure—
£
103,480,000
Local Authorities
Companies
Total
...
58,270,000
....
...
...
161,750,000
Average Price Charged to Consumers for all Purposes.—2'047d per unit.
Gross
Revenue.—£34,256,000.
Revenue per £100 invested.—£21'2.
Plant Installed.—3,096,535 k.w.
Maximum Load.—1,844,000 k.w.
Spare Plant.—68 per cent, of maximum load.
Units
Sold.-4,016,000,000.,
Units Sold per head of population.—110.
Annual Load Factor.—24'9 per cent.
Capital per K.W. Installed.-Generation,
£23'8; distribution, £28-5; total,
£523.
1
* There are in addition 48 stations owned by Railway Companies, 27 by Tramway Authorities
and 28 by Non-statutory Undertakings. Detailed information regarding these stations is lacking,
and they have therefore been omitted from this and other tables which deal solely with
Authorised Undertakings.
It should, however, be noted that the grand total of generating
stations in the country is 541.
10. Future Requirements.—It is a commonplace that the coming age will
be one oi electricity, and it is well known tnat the uses to whicn electricity can
be put are continually being augmented. At the present moment the average
annual rate of increase of consumption in this country is 19 per cent., but a
comparison of the position here with the position in other countries suggests
that the room for expansion is immense and that the rate of increase is likely
to grow. In this connection we may draw attention to the evidence of Mr.
Insull of Chicago. He stated that the consumption in and around Chicago is
almost 1,000 units per head of population, and in the course of the next fifteen
years he anticipates that it will be doubled. Continuing, he used these very
striking words, " The only limit to the amount of business we can get—and I
think that is so in any great industrial area, if the proper amount of brains is
devoted to the engineering of selling the energy—is the amount of capital you are
willing to invest in the business. I do not know where the point of saturation
is. I have been looking for it for 15 years."
11. The following, Table 2, gives the latest available returns of the con­
sumption per head of population in Great Britain and certain other industrial
towns and countries.
TABLE 2.
Consumption
a; "
Country.
population.
California
"
-...
1,200 units
Chicago
1,000 ,,
Canada
...
....
...
...
9 0 0 ,,
North East States of U.S.A
800
Switzerland ...
..700 ,,
Tasmania
...
...
...
550 ,,
U.S.A. as a whole
500 ,,
JNorway
...
5 0 0 ,,
Sweden
...
...
500 ,,
Sydney
Shanghai
...
...
5 ,,
i i
Great Britain
...
12. In using these figures it must be remembered that they include
only the consumption from authorised undertakings. In this country due
to the existing high price of electrical energy in many parts of the country,
and the dependence on small generating stations, many industrial users, and
private persons, prefer to generate their own electricity. The amount of privately
generated current is not accurately known, though a census was made in" two
given areas to form some opinion. I t is estimated that if energy from every
source, both public and private, were included, the consumption per head in
this country would be raised from 110 units to about 200. The amount of private
generation in other countries is probably less than in Great Britain, but whatever
adjustment must be made, there can be no doubt that we are not consuming
electrical energy at the rate of many other countries. As pointed out in the
Williamson Report, this has a very disquieting industrial aspect, inasmuch as the
national productivity in civilised countries is to a fair degree represented by its
energy consumption.
13. Effect of Price on Consumption.—The effect of price upon consumption
is well illustrated in the following chart, * which shows the relationship between
the average price of electricity supplied to consumers and the number of units
sold per head of population. The chart includes provincial companies and both
metropolitan and provincial local authorities. It shows that where the average
price is Sd. to 10d. the number of units sold per head of population is 20. At an
average price of 4eL the number of units has risen to 50. At 2d. the units sold are
140; and thereafter the number rises rapidly with each decrease of price. If
electricity is cheap, its use will spread, private generation will tend to cease; and
the greater demand and more diverse load will react favourably on the cost of
production and distribution.
1 6 1
1 4
11
* This chart was submitted by Mr. J. M. Kennedy.
\o-
CURVE SHOWING
AVERACE
t o
PER
:
PRICE
C o n s u m e r s
H E A P
or
BETWEEN
OF ELECTRICITY s u
NUMBER o f UNITS
ft.
p p l i e d
5 o l p
P O P U L A T I O N
iVoile.—Each cross represents an undertaking.
7-t
"
RELATIONSHIP
' ' '
w
o
3
0
0
'.
SoT
UNITS
SOLD
-tOO
PER
SOO
60S
700
HEAD.
14. On the basis of the present increase of 19 per cent, per annum, the
demand in Great Britain will have reached 500 units per head of population by
about 1940. Compared with other countries this seems a very conservative
estimate, but it will serve to demonstrate our point. We have already stated
the present national electricity bill on the basis of 110 units per head of
population. In the following Table 3 we set out. the increase in the bill on the
basis of 500 units per head of population. To arrive at a reasonably correct figure
it is necessary to bear in mind that with a much larger output the average price
will certainly decrease. It is difficult to forecast how far the price could be
reduced if existing methods continued; it is even problematical if in such ciroum­
stances an output of 500 units per head could be obtained. While a few of the
larger undertakings are selling to-day at an average price of 15d. or less, nine­
tenths of the undertakings are selling at an average which exceeds 3d. We are
advised that under the best circumstances the average for the whole country
might, with to-da3^'s methods, fall as low a,s V5d.; but would probably not fail
below V7bd. To get a clear picture we set out the increase (a) if the average
price,remains unaltered, (b) if it falls to V75d., and (c) if it falls to l'5d.
To-day's bill for
110 units.
£34,256,000 ...
(a) A t to-day's price
(b) A t an average price of l 75rf.
(n) At an average price of V5d. ...
-
Bill for
500 units.
Increase over
to-day's bill.
L
182,396,000
155,932,000
133,656,000
148,140,000
121,676,000
99,400,000
15. We have no hesitation in declaring- that, even if circumstances
demanded that to-daj^s conditions should still subsist for to-day's consumption,
the vast additional requirements of the country in the next few years must be
efficiently secured to the consumer at the lowest possible price, and we hope to
show that the possible savings are so large that they might even justify ignoring
present conditions altogether, and concentrating solely on the increment.
16. Technical Considerations.—The technical considerations governing the
generation and main transmission of cheap electrical energy in an industrial area,
which are generally accepted and confirmed by practical experience both here
and abroad, may be briefly summed up as follows :—Generation in large stations,
favourably situated as regards fuel, water and load with units of comparatively
large capacity; the minimum legitimate amount of stand-by plant; and the highest
obtainable load factor, to secure which stations should be inter-connected with
one another. (On account of the frequent reference to load factor, a term which
may not be generally understood, we annex a short explanatory note in
Appendix 5.)
17. As was shown by the earlier Committee, the parochial policy of genera­
tion, which to-day permits the existence of 572 authorised undertakings owning
438 generating stations, definitely ignores the technical considerations essential
to cheap generation. Of the 4 3 8 generating stations owned by authorised under­
takings, not more than about 5 0 can be regarded as being of really suitable size
and efficiency. Twenty-eight stations generate 5 0 per cent, of the total energy
while 322 stations between them only account for 1 1 per cent. The percentage
of stand-by plant is unduly high, and the load factor is unreasonably low. Inter­
connection is not carried out as a definite policy. These technical considerations
have been continually subordinated to other interests, and the resultant loss to
the country has been heavy, and becomes daily heavier.
18. Supply of Electricity.—In studying these electrical problems, it is
convenient to consider the problems under two heads, (a) the generation of energy
and (6) the distribution of energy.
19. Parliament has in the past granted authorised undertakers the right
to supply.
The right to generate
was not given specifically, but only as an
incidental adjunct to the right to supply. The detailed distribution of electrical
energy—in other words, its sale, transport and delivery—is essentially a local
matter, and a suitable function for decentralisation.
20. Generation.—Owing to the fact that this country was a pioneer in
the development of electricity, and that no formulated scheme of
generation existed, the widespread sub-division of supply rights granted by
Parliament necessarily led to a similar sub-division of manufacture or genera­
tion. Thus grew up the present system of individual generation and independent
undertakings, each pursuing an unco-ordinated and unrelated policy of develop­
ment. This natural prooess, which was perhaps inevitable in the circumstances,
has for some time now been in direct conflict with the technical considerations
which a wider and more mature knowledge has shown to be essential for cheap
and efficient generation.
2 1 . In 1918 the Williamson Committee recommended that a co-ordinated
policy should be secured by the division of the country into electrical areas,
each under the executive direction of a District Electricity Board, who would
purchase and operate the generating stations and regional transmission lines,
leaving the local distribution to the existing undertakers.
22. The 1 9 1 9 Bill was drafted on these lines, but was modified in the
House of Lords, where in the last few days of the session there was no time
525C1
A
i
to discuss the proposals. As a compromise, therefore, most of the compulsory
clauses were left out, on the understanding that they would be incorporated
JU a new Bill during the next session. This was done, but no progress was made"
with the new Bill. Accordingly the Electricity Commissioners were left with
very inadequate powers, being required, in fact, to secure the requisite co-opera­
tion and co-ordination by mere powers of suasion. Five years of patient and
capable effort have been unavailing. Co-ordination has not been achieved. The
advisory bodies created under the Act have agreed on technical schemes, but
local interests have prevented t h e carrying out of those schemes. Delay and
procrastination are widespread, and the policy of suasion can only be written
clown as a failure.
23. Inter-connection.—Turning from generating stations to their inter­
connection, the Williamson Committee clearly indicated the importance and value
of inter-connection and laid down means for securing efficient inter­
They also referred, but less specifically,
connection tvithin the areas.
The seven
to the importance of inter-connection between the areas.
years which have elapsed since the Williamson Committee reported have produced
almost complete evidence that this further degree of inter-connection bet-ween
the areas is a sine qua non to any really effective electrical system in a heavily
populated industrial country, such as is represented by the areas between,
roughly, the Clyde and the T a y on the North, and the Severn and Thames on
the South.
24. This evidence is based on the results achieved in certain areas of
this and other countries, and the economies which have been proved on a smaller
scale may be reasonably assumed for inter-connection on a larger scale, more
especially when it is borne in mind that Great Britain is in many respects an
ideal electrical area, and is far more compact than other countries. The proved
economies can be divided into three classes, viz. (1) those which are produced
by an over-all reduction in capital expenditure; (2) those which are produced by
a saving in the cost of operation (chiefly coal); and (3) those which result- front
increased load due to the demand for electricity in areas which could not be
-economically developed but for the possibility of tapping the inter-connecting
transmission lines. W e set out in Appendix 3 a more detailed s t a t e m e n t of
the saving under these three heads.
25. I n this connection we would again refer to the evidence of Mr. Insuli,
who said, " I n my judgment any man who refuses it (inter-connection)—and. 1
will not exclude England—does not understand the fundamental economies of
the business." And again, " I t (inter-oonnection) cannot possibly be a, doubtful
proposition."
26. The establishment of a comprehensive network of transmission mains
will make it possible to absorb much energy generated from waste heat, to
develop and use many sources of water power and also to join u p with some of the
larger generating plants already installed by groups of collieries and some other
industries. There is now much waste heat derivable from coke ovens, etc., some of
which is used for local generation of electricity, but the main obstacle to further
progress is the lack of a free market for the energy produced. W i t h a widespread
system of transmission mains laid out with waste heat conservation in view, there
should be a quickening of enterprise on the part of coke oven owners and others
The provision of a market for
towards the installation of generating plant.
energy from such sources will result in lower energy costs and also in reduced costs
of coke and other products.
27! Technical Scheme.—On all these technical questions we have had the
invaluable help of our Technical Adviser, Sir John Snell, and the benefit of the
practical experience of his colleagues. W e have also- had most valuable assistance
from Mr. C. H . Merz and Mr. J. M. Kennedy. Each of these three authorities
submitted to us independently outline pictures of the technical considerations
necessary to achieve efficient conditions of generation in 1940 or at a date when
the per capita demand had reached 500 units. These suggestions were remarkable
for their similarity in technical detail, and even more so in their financial
estimates, and were corroborated by the evidence of Mr. Instill on American
'
;
practice.
28. I n view of this, we asked Sir John Snell to prepare for us a definite
and practical technical scheme setting forth a picture of what should be aimed
* Extracted from a memorandum by Mr. C. II. Merz.
at to secure efficient generation of H.T. energy in 1940, or, alternatively, at the­
date when the per capita demand had reached 500 units, leaving aside at the
moment ail questions of administration, ownership and organisation of genera­
tion and supply. We did not ask for a mere ideal but for a detailed picture with
the essential financial data and estimates, taking full cognisance of whatever
was of value in to-day 's equipment or in immediate contemplation. This
scheme is set out in Appendix I, and for the immediate purpose of uus Report
the essential figures are given in comparison with to-day's figures in the following
table.
TABLE 4.
Position in 1940 or
when the consump­
tion has reached
500 units per head.
500
8,135,000 K.W.
10,000,000 K.W.
25 per cent.
21,385,000,000.
30 per cent.
Present
position.
Units sold per head of population
110
Maximum Load
1,844,000 K.W.
K.W. Installed
3,096,000 K.W.
Spare Plant
68 per cent.
Units Sold ...
4,016,000,000
Load Factor
24'9 per cent.
Total Capital :
Generation
£73,680,000
£127,000,000
" Gridiron " Transmission
£29,000,000
—
Distribution
£88.070.000
£243,500.000
Total Revenue
£34.256,000
£88,100,000
Average Price per Unit ...
2047^.
Id. or under.
Number of Main Stations
...
\
2R
Secondary Stations ...
( 438 of all kinds, j
30
29. Estimated Economies under the Scheme.—It is of the greatest import­
ance to note, as already stated in paragraph 14, that under existing conditions
of individual development the utmost that could be expected by 1940 would be a
reduction in the average price per unit from 2'047c?. to 15d. The estimated
saving on the electricity bill to the country by the adoption of the new technical
scheme, when the consumption has reached 500 units per head and the average
price is Id., is shown in the following table :—
TABLE 5.
Estimated annual
saving.
If price remained 2'047cZ.
£93,296,000 per annum.
,, ,,
fell to 175c?.
£66,832,000
£44,556,000
,, ,,
,,
1 5d.
30. We have in these figures the direct objective of our review stated in
the most concrete possible form, namely, the reduction in the future electricity
bill of the country. We suggest that on the lowest computation the magnitude
and importance of the saving demand immediate and decisive action.
31. Following on the submission of this scheme we arranged for the appoint­
ment of an Advisory Expert Committee, consisting of Mr. Merz, Mr. Kennedy
and Mr. Pearce, to review the scheme and figures and check the estimates. Their
Report, which broadly confirms the estimates, is given in Appendix 2. Here we
desire to say that Sir John Snell's technical scheme was prepared at very short
notice, and although its conclusions and estimates are fully supported by the
Advisory Expert Committee, the scheme which is perfectly practical and
realisable in character must only be regarded as a broad picture subject to modifi­
cations and improvement when the fully detailed and comprehensive survey which
we advocate has been completed. For example, no allowance whatever has been
made for Waste Heat Schemes or for any Water Power Schemes other than those
now under consideration, and as noted by the Advisory Committee an even better
selection of existing stations may be possible.
32. Comparison of Technical Scheme and Actual Position.-An analysis
of the scheme discloses certain outstanding changes from the existing system in
regard to the generation of energy. The salient points are : —
(a) All energy will be generated in certain selected Main and Secondary
Power' Stations, of which 43 are existing and 15 are new.
1
(b) 432 existing stations will be eventually closed down.
(c) A " gridiron " of high tension transmission mains will be erected
inter-connecting all the selected stations and coupling up with
existing regional transmission systems and other existing stations.
I t should be noted that the scheme provides fully for the new demand,
together with a replace supply to meet that now given by the closed down stations!
and that the area to which the scheme refers is the whole of Great Britain
excluding the northern and extreme western parts of Scotland and the extreme
western part of England.
33. Due weight has been given to the economy factors of generation
by large units in large stations, the qualifying influence of the position of station
sites in relation to the load served and theutilisation of existing suitable plant,
as well as the economic effect of transmitting high load factor energy over the
lines and the utilisation of selected local generating plant to meet the peak loads
of the district.
34. We should at this point perhaps refer to the fact that there exists a
body of opinion holding the view that the ideal scheme for this country involves
generation in a small number of very large stations termed Super Power or
Giant Stations, and that enormous blocks of energy should be transmitted over
quite long distances. We believe it is possible to exaggerate the value of concen­
tration of generation in very large stations and of securing the lowest possible
cost of energy at the station bus-bars which may be partly neutralised
by the cost of transmission. ' The vitally important factor is to secure
the supply to the consumer at the lowest possible price, and this involves a
compromise between a large number of factors. For example, taking to-day's
conditions it is seen that on capital expenditure alone 73 millions are expended
on Generating Plant and 88 millions on Transmission and Distribution, i.e., the
capital charge is less than half expended on energy at the bus-bars. In 1923
the average cost at the bus-bars was 1"098^. per unit, and to the consumer 2'047'rf.
Under the scheme the average* price at the bus-bars will be 0'36^. or thereabouts,
and at the consumers meter Id. or under.
PART II.
35. Constructive steps.—In the foregoing part of our Report we have
outlined the present conditions governing the generation of H.T. energy, and by
way of comparison have drawn a picture of a practical scheme, showing broadly
its financial justification. We now propose to consider the constructive steps
necessary to realise the scheme with the minimum of interference to existing
conditions, rights and interests.
36. The key to the scheme lies in an element new to the British electrical
industry, viz., complete interconnection of the generating stations. We have
referred in paragraph 24 to the technical and economic advantages likely to be
gained. We would here point out that these advantages will have reactions
favourable in nature though varying in degree on all existing undertakers. In
a word all will benefit by the creation and use of something which no' one of them
could create individually.
37. At the present time there exists no authority with powers to construct
and operate a transmission system on the scale contemplated. Further it will
involve heavy capital expenditure, and therefore presents a financial problem
unlikely to be solved without some measure of State assistance or guarantee.
38. These two considerations point to the conclusion that the generation
of H.T. enerew must be regarded in an entirely new light. It must be recognised
that a beneficial mechanism created by the help of the State must be operated
so :\s to secure the best results for all, and the realised economies must inure in
the main to the consumer.
39. Central Electricity Board.—As a first step, therefore, we recommend
that a new body should be created by Act of Parliament, termed the Central
(* As an illustration of h o w the average price is distributed among various classes of consumers-,
see chart (Appendix C) following page 34.
Electricity Board. The constitution, powers and duties of the Board are more fully
set out in Appendix 4. The duties and meetings of the Board would not involve
whole-time service, but the Board must be assisted by a carefully selected
Managing Director and an expert staff. In addition, we recommend that the Board
should constitute an Advisory Committee from the Chief Engineers and Managers
of the selected generating stations who should meet from time to time to assist the
Board.- The capital of the Board should be raised by means of Electricity Stock
guaranteed as to principal and interest by the Treasury. The first duty of the
Board will be to construct at the earliest possible date a " gridiron " system of
H.T. transmission lines, in general conformity with a technical scheme approved by
the Commissioners, interconnecting certain selected generating stations, and also
connecting through existing or new lines with existing regional transmission
Several districts have been carefully
svstems and other generating stations.
studied and detailed estimates have been prepared in order to determine how
soon the Board could be financially self-supporting. These figures have also been
checked by the Advisory Expert Committee and are supported by them. We
are satisfied that a comparatively small working capital, coupled with the ability
to capitalise interest for a period of up to five years, will enable the Board to
transmit energy at about 0'15d. per unit for the first few years, and eventually
at a figure of 0'ld or less, and to pay its way from the beginning of its operation.
40. The problem with which we are faced at this point is the manner in
which this " gridiron " and its directing Board can be super-imposed on the
existing system. Several alternatives are possible. The Board might be viewed
as a transmission enterprise pure and simple. As such it would purchase cheap
energy from efficient stations and by disposing of this energy to less well-favoured
undertakers, enable them automatically to close down their own inefficient stations.
A second alternative would be for the Board to act as a common carrier of energy,
merely charging for the use of the lines and leaving all purchase and sales to the
ordinary negotiations between buyer and seller. Thirdly, a policy might be
adopted, under which all generating stations would be purchased, the less efficient,
closed down and the best operated by the Board, thus bringing all generation
definitely under the control of a single body.
41. If the first alternative were adopted it is clear to us that the transactions
in regard to purchase and sale would be infinite in variety. No security would be
offered to undertakers and consumers that the operations of the Board would be
on any uniform or definitely economic scale. Purchases would represent trans­
actions made by dealing in marginal supplies of energy, and the prices would tend
to be on a by-product, or even dumped, basis, involving a distinct measure of
insecurity and instability.
42. The second alternative is open to the very grave objection that before
the lines could be used Authorised Undertakers (Local Authorities and Companies
alike) would be required to bargain with one another, a practice which past
experience has shown to involve very real difficulty and delay. Neither this
alternative nor the first would secure co-ordination in the control of generating
stations, and both would leave the closing clown of inefficient stations to the
incidence of commercial bargaining on the unstable basis of prices of dumped
energy.
43. The third alternative is an extension of the recommendations of the
Williamson Committee. That Committee proposed the creation of Joint Elec­
tricity Authorities who should acquire and run the generating stations in each
electricity area. In the case of a Central Electricity Board it would mean the
ownership of all stations in the hands of one Board. Apart altogether from the
difficulties which would attend the wholesale.purchase of all existing stations, and
the delay involved in the change of ownership, it is clear that this alternative
would lead to the creation of a huge and unwieldy organisation. It might lead
to stereotyped practice, check development and progress, remove incentive from
the officials and tend to bureaucratic administration. Under such an arrange­
ment we doubt if the stations would be run as well as they are to-day. There
would be a sharp cleavage between generation and distribution which might lead
to lack of co-ordination between manufacture and demand.
44. We feel compelled to reject any proposals under which the Board would
act merely as transmission agents or as merchants of surplus energy.
Our
objective should be to secure that the Board deals with electrical energy on terms
and conditions which are a definite reflection of the costs of the total amount
of electricity generated throughout the country or at least the costs associated
with large areas of supply, and not merely on the artificial basis of marginal cost,
arrived at by negotiations with independent authorities.
45. Bearing this and other factors in mind, we have reached the following
definite conclusion, which represents the main feature of our Report. In our
view the advent for the first time of a complete interconnecting " gridiron " of
transmission mains warrants the segregation of generation of H.T. energy, and
the energy thus generated should be available to all undertakers at cost price.
Much may, however, be gained by leaving the operation of the selected
stations to the existing authorities and confining the change to the sphere of
control. Briefly, therefore, we recommend that all H.T. energy generated by
authorised undertakers in this country after a certain date should be generated
under control in accordance with a technical scheme for the country, and sold
through the Board to all authorised undertakers at cost price.
46. Undertakers who own other than selected stations will find themselves
justified in closing down their stations gradually as H.T. energy supplies become
available from the " gridiron " at lower prices than they can themselves generate.
We think that the benefits of the availability of cheap energy to be obtained by
our proposals will lead to the rapid closing down of inefficient stations on a
voluntary basis after the erection of the " gridiron."
As a precautionary
measure, however, we recommend that the Commissioners should have power to
require the closing down of stations after a specified period, provided a supply
from the " gridiron " at cheaper prices is available. In this connection we would
refer to the powers which the Cormmssioners possess to extend periods for repay­
ments of loans, and we suggest that they should give sympathetic consideration
to requests of this nature from undertakers whose stations are closed down.
47. Accordingly we recommend that the Act constituting the Board should
give it the power, and at the same time require generating authorities who are
owners of the selected stations, to make the following contractual arrangements
with the Board :—
(a) Owners to operate the selected stations as directed by the Board in
the best interests of generation as a whole. We believe that the
interfering nature of this control has been exaggerated. It is not
exacting as shown by American and other experience. To a large
extent it is predetermined, e.g., certain stations will be run only in
the winter; others will close down at week-ends; the best stations
will be run continuously on a high load factor basis, while others
less efficient will deal with peak loads only. Generally, the condi­
tions of operation will be such as any knowledgable electrical
engineer would subscribe to as representing sound practice.
(b) All generation to be for the account of the Board. Cost will include
interest on the capital properly attributable to the generating stations
(the interest will be at a uniform rate of, say, 6^ per cent., whether
the generating stations to be controlled are owned by public autho­
rities or companies); an agreed, depreciation allowance sufficient to
cover all renewals and replacements, obsolescence, &c.; all manage­
ment and general establishment charges attributable to the stations;
rent, rat.es and taxes; fuel, oil, water and stores; wages and salaries;
repairs and maintenace. Interest on Sinking or Renewal Funds to
be brought to account. I t should be noted that the interest of 6£ per
cent, referred to above applies only to capital already expended on
stations. We deal in paragraph 50 with the interest on future
capital.
(c) Owners to repurchase the energy required for their own supply areas
either at the actual cost as above from their own stations (adjusted
to their area load factors), or the " gridiron " price, whichever is the
lower. If the stations are run only on peak loads, or if the owners
require more than a station can itself generate, they will pay the
" gridiron " price.
(d) In the event of dispute between the Board and the owners of selected
generating stations, either party to have the right to make repre­
sentations to the Commissioners; but pending the Commissioners'
decision, the stations shall be operated and the costs apportioned
under the direction of the Board, subject to such adjustments as
may be decided thereafter by the Commissioners.
48. The reaction of complete interconnection on the owner of even the most
modern station will be a reduction in the cost of generation unattainable by any
action of his own. This is due to the economic factors mentioned in paragraph 24.
He secures a further advantage, viz., the larger output resulting from reduced
price. He sells more at a lower price, gets a better load and obtains a better yield
on his distribution investment.
49. We have considered the advisability of recommending that the tariff
of the " gridiron " should be uniform throughout the country. While we are
convinced that this should be the ultimate aim, we recognise that variations in
the price of coal will probably render it prudent to have zone or area tariffs in the
early years, and we do not consider it wise to tie the hands of the Board during its
initial stages by rigid regulations.
50. New Generating Stations.—In paragraph 47 (&) we have recommended
a uniform interest allowance of 6-^ per cent, on capital already expended on
generating stations. For all future extensions of selected stations or the building
of new stations we suggest that the capital should be provided under Treasury
guarantee of principal and interest. It might appear unnecessary to provide
such a guarantee in the case of Local Authorities, but in view of the possibility,
and even probability, of some of the larger Local Authorities being asked to erect
and operate a new station for the Board much in excess of local requirements,
we do not think that the burden should rest locally, and we recommend that the
Treasury guarantee should apply. This guarantee will secure the generation of
energy at the lowest possible cost so far as interest charges are concerned.
Consequently all undertakers will be enabled to concentrate their entire financial
strength on the development of their distribution system, which is, after all, their
real business.
51. It is our recommendation that the ownership and operation of all selected
stations should remain in the hands of Authorised Undertakers. We recognise,
however, that circumstances may occasionally make this impossible—e.g,, the
" gridiron " may extend into sparsely populated areas where no authority is
available, or exceptional cases may arise in which the more obviously appropriate
authority is unwilling to undertake the work.
To meet such cases, which we
think will be rare, or others which may be unforeseen, we recommend that the
Board should, as a last lesort, have power to build and operate stations, but only,
of course, with the consent of the Commissioners.
52. The conception of the owners of selected stations as generating agents
of the Board may be challenged on the ground that when their operating costs
and future capital requirements are being met, there remains no incentive for
them to operate the stations efficiently. This, however, is a misconception. They
have to repurchase the energy they require for their own business, and the lower
its cost the greater their advantage. Further, their cost figures will be compared
with the figures of other stations : the comparison will be open to all and emulation
definitely promoted.
53. We fully realise the apparently drastic nature of our proposal, but we
are convinced that in operation it will not involve any hardship to existing
interests. The Williamson Committee proposed the acquisition of all generating
stations in each Electricity Area by a Public Authority, the economy to be realised
being that due to complete co-ordination in the Areas. Our aim is to achieve the
beneficial reactions of co-ordination not only in separate Areas but over the country
as a whole. We propose not a change of ownership, but the partial subordination
of vested interests in generation to that of a new authority for the benefit of all,
and this only under proper safeguards and in a manner which will preserve the
value of the incentive of private enterprise.
:
PART I I I .
54. Effect on Existing Authorised Undertakers.—The creation of a new
Electricity Authority such as we have proposed is bound to have reactions in many
directions, and there are points at which its powers may conflict with those of
existing Authorities. We have already dealt with generation, and we propose in
this Section of our Report to deal with these other points.
55. At the outset we would state that we do not desire to impair or interfere
unnecessarily with existing rights.
Any modifications that may be suggested
arise directly out of the existence of the " gridiron," and we would emphasise
the fact that the existence of the " g r i d i r o n " adds definitely to the value
525(51
A
7
of existing rights. To-day, distribution is a practical monopoly: under our
proposals the commodity to be distributed will become available to the monopolist
at lower prices, and, therefore, his monopoly will become more valuable.
56. Existing Authorised Undertakers may be divided into three classes :—
(1) Local Authority Undertakers : (2) Power Companies : and (3) Distribution
Companies.
57. Local Authority Undertakers.-So far as existing Local Authority
Undertakers are concerned, we do not find it necessary to interfere with their
position in any direction. There are, however, 71 of the smaller Local Authorities
not themselves undertakers, who have a statutory right to purchase the undertaking
in their area whioh now forms part of the distribution area of a larger Local
Authority. We do not consider that any real benefit can result f rom the exercise
of this right. The creation of the smaller authorities as new undertakers would
merely add to distribution costs and advance prices. We, therefore recommend
the repeal of this right.
58. Power Companies.—The position is more complicated in the case of
Power Companies. Under the existing Power Companies' Acts these companies
are authorised to supply, inter alia, electricity in bulk to Authorised Undertakers.
59. In many of the separate Acts there are, however, towns-generally of
the larger class—which have obtained, special protective clauses; and in them the
Power Company has no right to supply except under the written consent of the
Local Authority. This type of undertaker we may term a '' free town.' The
other Local Authorities in the Power Company's area who have no such protection
may be termed " tied towns."
60. Bulk Supplies.—It must be understood that the Power Company's right
of bulk supply is not entirely monopolistic, for the 1909 Electricity Act permits
two adjacent Local Authorities to give a bulk supply from one tojJie other; and
under the 1919 Act, any two Local Authorities-wherever situated within the
Power Company's area—may be authorised to give a bulk supply one to the other.
61. There is no practical injustice to the Power Company in enabling the
Board, as we now recommend, to give a direct supply to the " free towns "; and
in the case of the '' tied, towns '' we do not propose to alter the Companies' right
to supply. It is, however, necessary to see in such cases that the cheaper energy
which will be afforded by the Board shall be passed on to the Authorised Undertaker
by the Power Company and that that Authorised Undertaker shall obtain that
benefit.
62. An arrangement has been made in the South East Lancashire Electricity
District between the Lancashire Power Company and the various important local
authorities in that District which we think can be well adopted in other Power
Company areas, namely that in such cases as we are here dealing with, the Power
Company passes on the cheaper electricity to the Authorised Undertaker and is
content to charge only the working expenses and a reasonable remuneration upon
the capital expended on the necessary transmission lines provided by that Com­
pany. This involves charging against the actual capital expended on the whole
or part of a transmission line used for the bulk supply the proper contribution to
depreciation, a proper proportion of management and general establishment
charges, rent, rates and taxes, maintenance of the line, cost of units lost in
transmission and interest on capital which we think should be fixed at 6i
per cent.
63. Power Supplies.—Passing from bulk supplies to the supplies given by
Power Companies to individual consumers, we do not feel that it is necessary
to suggest more than a slight revision of the present maximum price clause. This
should be strengthened and rendered more effective by providing for :—
(a) An initial revision at the instance of the Commissioners on the coming
into force of the new arrangements;
(b) Subsequent revisions at intervals of each 10 years.
64. Sliding Scale.—We have very carefully considered whether, in addition
to our other proposals, it would be desirable to provide for a revision of the
present sliding scale of price and dividend for Power Companies, and have reached
the conclusion that this is not necessary.
65, Existing Acts provide for a limitation after 8 per cent, has been
paid, and in the case of the recent London and Home Counties Order the Com­
:
panies agreed to a standard rate of 7 per cent, in association with a new prescribed
distribution of excess profits. While the Power Companies have rights that are
definitely monopolistic, it would be unfair to ignore the fact that very valuable
development has been achieved under their aegis. All of them have taken big
risks and few of them have yet attained the standard dividend.
66. We have specifically safeguarded the bulk supplies to other under­
takers—a point on which the action of the Power Companies has sometimes been
criticised—and we have made the maximum price clause more effective. In view
of this and the fact that the large power consumer will deal with a Power Com­
pany only at prices definitely below the price at which he could himself generate,
we feel that it would not be in the interests of electrical development to place
any further handicap on the enterprise of Power Companies. Bather we take
the view that, now their rights have been recognised and the essential safeguards
imposed, they should be encouraged to proceed with a feeling of security to the
acceleration of the development of their network of transmission mains.
67. We think, however, that the powers which they now possess to make
up back dividends to 8 per cent, should be repealed. We understand that this
power has never yet been exercised, and that in the case of the North Wales Power
Company it has been voluntarily surrendered. I t is unusual for public utilities
to possess such a power, which, if exercised, would in effect make the sliding scale
provisions meaningless.
68. Distribution Companies,—Turning to Distribution Companies, we
find only one point in which we suggest that an alteration should be made. This
relates to the purchase of undertakings by Local Authorities. Under the existing
law any Local Authority may at the end of 42 years purchase the undertaking in
its area on six months' notice, and this right recurs at the expiration of every
subsequent period of 10 years. It appears to us that the possibility of purchase
at such short notice has the effect of sterilizing the activities of the undertaker
during the latter years of his franchise owing to his reluctance to sink capital
in an undertaking which may be compulsorily purchased. We recommend
that in the interests of electrical development this statutory right of purchase
should be modified in the following manner :—
(a) The undertaker should have the right at any time within seven years
of the end of his franchise to require the Local Authority to
declare their intentions;
(b) If the Local Authority fail to notify their intention within six
months, or require unreasonable terms and conditions for the non­
exercise of their powers, the Commissioners may by Order suspend
the right of purchase for such period as they think fit;
(c) If the Local Authority declare their intention to purchase, they shall
advance by way of loan such moneys as the-undertaker may reason­
ably require for expenditure on capital account during the
remaining seven years, and so assure the continued development of
the undertaking.
P A B T IV.
69. Regional transmission.-We now turn to another vital aspect of the
situation, namely, the steps essential to the creation of widespread secondary
transmission lines, and distribution net works. To show the extent to which
electricity is now available in this country, we cannot do better than quote from
the last Report of the Electricity Commissioners : —
" Dealing now with the classes of local government areas specified
in Table 2, the approximate position at 31st March, 1924, in respect
of authorised supplies of electricity, was as summarised in the following
notes:—
" (i) Administrative County of London.
' (ii) County Boroughs.
" General supplies of electricity are available throughout the
whole of the Administrative County of London, and in each of the
82 County Boroughs in England and Wales.
" (iii) Municipal Boroughs.
" General supplies are available or in process of being established
in 175 (or 69 per cent.) of the Municipal Boroughs in England and
c
A 8
82661
'
\"
',v''rj.----
r-i-rr^^fc-^-SSI^^wa^^m^
Wales, such Boroughs having a total area of 882 square miles, and a
total population of 4,236,338, representing an average density of
population amounting to 4,803 per square mile.
'' The remaining 78 Municipal Boroughs in which general supplies
are not available or in process of establishment, comprise a total area
of 378 square miles and a total population of 407,631, representing an
average density of 1,078 per square mile. Only eight of the Boroughs
in question have a population of 10,000 or over, and four of these
Boroughs are situated within the areas of supply of Power Companies.
" (iv) Urban Districts.
'' General supplies are available or in process of being established
in 448 (or 57 per cent.) of the Urban Districts in England and Wales,
such districts having a total area of 2,330 square miles and a total
population of 6,505,652, representing an average density of 2,792 per
square mile.
'' The remaining 342 Urban Districts in which general supplies
are not available or in process of being established, comprise a total
area of 1,800 square miles and a total population of 1,818,349,
representing an average density of 1,010 per square mile. Of these
districts, 42 have a population of 10,000 or over, and 22 are situated
within the areas of supply of Power Companies.
" (v) Rural Districts.
" A n analysis on the foregoing lines has not been extended to
the case of Rural Districts in England and Wales, figures showing
the approximate extent to which the area and population of such
districts are included in areas where general supplies are available
or in process of being established, not being readily ascertainable.
Broadly speaking, however, there are not more than about 10 per cent,
of the Rural Districts wholly included in the areas of supply of
undertakers authorised to give general supplies for all purposes,
although in a number of other cases such districts are within the
statutory limits of Power Companies.
With regard, however, to
portions of Rural Districts, there are numerous cases in which the
more populous parishes, townships and villages in the vicinity of urban
centres form part of the area of supply of the undertakers operating
in such centres,
" From a broad review of the present position, it will thus be seen
that general supplies are available or in process of establishment in areas
in England and Wales having a population of the order of 28,000,000,
or about 74 per cent, of the total population of the country. Some
indication of the potentialities of the remaining areas is afforded by the
fact that there are no less than 50 Municipal Boroughs and Urban Districts
with populations of 10,000 or over, in which general supplies have not
yet been authorised." (Report for 1923-24, paras. 10 and 11.)
The position as disclosed shows that there is ample room for a more widespread
availability of supply.
70. Joint Electricity Authorities.—Under the Act of 1919 it was contem­
plated that Joint Electricity Authorities would be set up as executive bodies in
each electricity area, and that they would acquire the generating stations and con­
struct the area " gridiron," leaving local distribution to the authorised under­
takers. This scheme has been realised only to a very slight extent. At the momenf
there is one Joint Electricity Authority in being, and that Authority has handed its
executive duties over to a Power Company. The Commissioners have made an
Order now awaiting confirmation for the constitution of an Authority in
London and the Home Counties, but here again for reasons which it is unnecessary
to discuss, the Authority will not for many years function in the manner contem­
plated by the Act. One other Order to establish a complete Joint Electricity
Authority is awaiting confirmation,'
71. We fully realise the importance of securing co-ordinated regional effort,
but we must point out that the existence of the " gridiron " and the overall
co-ordination of generation will remove many of the defects which it was hoped
to eliminate by the constitution of Joint Electricity Authorities. The stumbling­
block has always been the generating stations, and this is now removed.
72. Power Company Areas.—Practically ail the important industrial
areas are covered by the Power Companies, whose duty it is to provide for
regional transmission. The main defect is that no definite machinery exists to
provide for co-ordination or regional transmission between the Power Companies
and the large municipalities in their area.
In our view the advent of the
'' gridiron '' will go a long way towards remedying this evil. In the first place,
by interconnecting the selected stations and connecting up with existing systems,
the " gridiron " will itself provide a very useful backbone of transmission mains.
We have further suggested that the 73oard should have power to connect up with
the " Tree Towns " or to arrange for the Power Companies to do so. This will
carry the position a stage further.
73. We do not, therefore, regard it as necessary to lay down any rigid
policy for the creation of regional authorities. We think it wise to leave in
existence those Joint Electricity Authorities already formed. Further, we see
no objection to the creation of additional Joint Electricity Authorities, if the
Commissioners regard this as desirable and provided the necessary co-operation
can be secured. We do not, however, suggest any extensions of the Commissioners'
powers in this direction, being of the opinion that they will find far less difficulty
in creating such bodies when the generating stations have been lifted out of the
picture, and supplies have been made available through the medium of the
" gridiron."
74. Advisory Committees.—In certain cases where the Commissioners
have failed to secure Joint Electricity Authorities, they have made Orders
constituting Advisory Committees. The question of retaining these Committees
is one which we think should be left entirely to the discretion of the Commis­
sioners.
75. New Areas.—Leaving the areas covered, by the Power Companies, we
would point out that a distinctive feature of the '' gridiron '' will be the Oipening
up of definite possibilities of development in the more sparsely populated districts
through which, it passes. I t is therefore necessary to- consider the methods by
which regional transmission systems can be secured in areas where no Power
Company exists. We have given much thought to this aspect of our problem,
and have come to the conclusion that in such areas regional transmission and
local distribution cannot be dealt with separately. At this point we desire to
recommend that under no conditions should the Board be empowered to under­
take distribution in the ordinary sense of the word. At most it should be
authorised to supply large individual consumers who require power for industrial
purposes and cannot reasonably obtain such power from other sources.
76. The areas will differ in potentialities. There will be purely non­
industrial areas and also' areas in which there exist definite possibilities of a future
demand for power. In the latter case, particularly, the most obvious course would
be to encourage the setting up of new Power Companies in accordance with the
present practice, but for the reasons which we set out below, we are of opinion
that such a course should not be adopted.
77. Supply Companies.—Cnder the existing system there are two types
of company differing in certain essential respects. In the first place there are
Power Companies endowed by Act of Parliament with powers limited in nature,
but monopolistic and perpetual in tenure. In the second place there are
Distribution Companies set up by Special Order with power to supply for all
purposes, but over a restricted area and subject to purchase after 42 years.
Neither type is wholly satisfactory, and in other parts of our Report we recom­
mend various modifications which we believe will improve the position without
unduly affecting existing rights and interests. We do not, however, regard the
system even with the alterations we have suggested as ideal, and for the future,
more especially so far as the new areas are concerned, we recommend
as a substitute for both Power and Distribution Companies alike,
a new type of Supply Company which will embody the more desirable
principles of both.
We recommend that Supply Companies should
be created by Special Order so as to avoid the greater expense
of a Private Bill, and should be authorised to supply for all purposes. The
Company should be required to justify the area over which it asks for rights, but
it should be the policy of the Commissioners to encourage applications for wider
rather than more restricted areas. So far as extent of area is concerned the
Supply Companies will thus approximate at one end to existing Distribution
1
52561
A
i
)
-
Companies, and at the other end to Power Companies. They should be subject
to a purchase clause which can be exercised after 50 years, with right of notice
seven years before the expiry of their franchise. Where the area is confined to a
single local government area, the right should be exerciseable by the Local
Authority concerned; where it is larger, it should be exerciseable either by a Joint
Electricity Authority or an Association of Local Authorities in the area. The
purchase clause should be simple in character and based upon the capital properly
expended less such depreciation as the Commissioners may allow. If notice of
purchase is not given, the Commissioners should have power to extend the
franchise for such period as they think fit.
78. Where these new Supply Companies cover wide areas, they will be
responsible not only for actual distribution, but also for regional transmission.
Where their activities are confined to a limited area, as will probably be the case in
the purely non-industrial regions, the Board should be empowered to lay down
secondary lines connecting their system to the " gridiron." This will at once
provide the nucleus of a regional transmission system, and open up the
possibilities of development in further directions.
P A R T V.
79. Finance.—It is necessary to consider in rather more detail the financial
effects of our proposals. The technical scheme will, we think, involve during the
next fifteen years new money to the extent of upwards of £250,000,000, which
is substantially less than would have been required if development continued
under existing conditions. We estimate that one-half of this new money will be
required in connection with the development of distribution schemes, and this
capital should be provided by the Local Authorities, Power or Distribution
Companies as now.
80. Loans required by Local Authorities are subject to the sanction of the
Electricity Commissioners. In view of the benefits to all undertakers, including
companies, which will flow from our proposals, we recommend that all further
capital raised by companies should also- be subject to the approval of the Com­
missioners so as to ensure that the capital is raised on terms that are most
advantageous to the consumers and the undertakers alike. This should secure
inter alia a proper ratio being maintained as between Ordinary Stock, Preference
Stock and Debentures.
81. The other half of the new capital can be conveniently divided into two
sections :
(a) The amount necessary to construct the " gridiron " for bulk trans­
mission plus (1) The necessary working capital (2) Sufficient reserve
to cover the initial expenses of management (3) Interest capitalized
for a period of say five years, at which date the net earnings from
the " gridiron " should be sufficient for all purposes. We estimate
that a sum of £25,000,000 would be absorbed in the foregoing by
the end of five years from the date the scheme is put into operation,
and this sum should represent the original authorised capital of the
Board.
(&) The amount necessary to provide local authorities or other authorised
undertakers with the capital required for the erection of new selected
capital stations or additions to present selected stations as fore­
shadowed by Sir John Snell in his report covering the period to 1940.
82. In regard to Section (a), we recommend that this capital should be in the
shape of " Electricity Stock " issued by the Board with Government guarantee as
to principal and interest, Sinking Fund provisions to be operative only after five
years, and power given to the Board to capitalize interest if necessary during
the first five years.
83. In regard to Section (b), we recommend that this capital should be
issued by the Authorised Undertakers empowered to construct the new stations,
but with Government guarantee as to principal and interest, and with safeguards
as to Government credit and responsibility similar to those now given effect to by
the Advisory Committee under the Trade Facilities Act.
Schemes should be
submitted through the Board to the Treasury with the prior approval of the
Commissioners.
84. The whole of the foregoing capital is for the purpose of the development.
of an important and essential public utility, and in so far as the expenditure is to
be incurred by local authorities or private enterprise, their operations will be
clearly monopolistic and must, therefore, be surrounded by safeguards for the
public interest.
85. In our view, the scheme will assist those associated with the financing of
this public utility to strengthen and deepen the confidence of the public in the
stability of the electricity business, and, we would hope, lead to the continuous
growth of investments in electricity concerns by the consumers of the energy.
86. We feel that it would be of considerable social value if these electricity
securities be held by as wide a body as possible, and accordingly we recommend
that they be made available in small denominations.
PART
VI.
87. In this final part of our Report we deal with a variety of points arising
directly or indirectly out of the recommendations we have made.
88. Standardisation of Frequency.—Our attention has been called to an im­
portant proposal to.unify the varying frequencies of electrical energy supply over
the whole of industrial Great Britain, originally made to the late Government by
the Electricity Commissioners and accepted by them but not put into force.
89. The definite proposals are contained in two documents :—
(a) A memorandum dated 2nd January, 1925, from the Electricity Com­
missioners to the Minister of Transport.
(b) A report of a closely detailed investigation based on the Clyde area into
the financial, technical and commercial aspects of the problem, made
by Messrs. Merz and McLellan at the request of the Commissioners
and with the concurrence of the late Minister of Transport.
90. The Memorandum and Report indicate clearly the benefits to the elec­
trical industry, the electricity manufacturing industry and the consumers. They
make it equally clear that the entire cost must be borne by the State if the change
is to be made within a reasonable period, and that any long drawn-out scheme
would fritter away the ultimate economies.
91. The estimated gross cost, which would be spread over a period of 3-4
years, would be under 10^ millions, while the estimated net cost after allowing for
expenditure represented by useful additions to the plant capacity of supply under­
takings should not exceed 8 millions.
92. In recommending the late Government to adopt this scheme the Com­
missioners did not definitely associate it with any proposals for remedying the
general situation although it is clear to us that they had in mind the probability
that an interconnecting " gridiron " such as we recommend might be created in
the future.
93. We have carefully considered the scheme and have heard evidence from
the Commissioners, Messrs. C. H. Merz, J. M. Kennedy, J. S. Highfield and
R. A. Chattock, the City Electrical Engineer of Birmingham.
We were not,
however, prepared to make a recommendation for the whole country based on
the report from a single area, and we therefore arranged as a preliminary step­
for a detailed survey of the Birmingham district in addition. This survey is now
being carried out and the report will be available shortly.
94. Subject to this Report broadly confirming the original Report for the
Clyde Area, we have come to the following conclusions :—
(a) While we recognise the advantages of Standardisation of Frequency in
this country and appreciate its stimulating influence on the develop­
ment of electricity, we are not prepared to recommend the expendi­
ture of 10 millions to- achieve these advantages except as part of a
comprehensive scheme for improving our existing electricity system.
(b) Interconnection on the complete scale which we recommend is the first
essential towards bringing about subsequent and far-reaching­
improvements in our present system, and interconnection cannot be
entirely effective without standardisation of frequency.
52561
A 10
(c) Accordingly we recommend that immediately the detailed Report on
the Birmingham area is available and provided that it gives broad
confirmation of the practicability and cost, the Government should
instruct the Minister of Transport to proceed at once with the pro­
posal and to defray the cost from State Funds. In view, however
of the ultimate advantages which the undertakers will reap, we
do not think that compensation should be included for' any
temporary loss of revenue during the change-over period.
(d) On this question of cost we recommend that consideration should be
given to the possibility of repaying to the Treasury this expenditure
through the operation of the Board.
In our view it would be
thoroughly justifiable to fix a date (say) six years from the constitu­
tion of the Board, after which for a further period of (say) 20 years
the Board would impose a levy on the costs of all energy sold which
would in that period enable the Treasury to be repaid without
interest the sum it had advanced.
95. Rating.—Our attention has been drawn to the fact that in the year
1923 the electrical industry paid £2,191,437 in local rates. As the gross receipts
for the same period amounted to £34,256,000, it appears that rates account for
some 6 per cent, to 7 per cent, of the total bill.
96- We have considered what effect this will have on the operations of the
Board. As one of the main conditions governing the creation of the Board is that
it should make no profit, it follows that the payment of rates will involve an
increase of the price at which energy is supplied.
97. The paramount importance of a cheap and abundant supply demands
a careful consideration of the question whether the Board should be saddled with
fie necessity of adding to the price of high tension energy for the-sole purpose of
paying rates.
98. The existing system of rating electrical undertakings may be roughly
described as a payment based on profits : in other words, the undertaking itself
shares its prosperity with the local community. In the case of the Board, as we
have already pointed out, rates will have to be paid by increasing the price, and
this increase will in effect be a direct levy of rates upon the consumers, not on the
Board. Hence the consumers will be called upon to pay rates not only in their
own areas, but also in other areas through which the " Grid " lines pass and in
which the consumers have no direct interest.
99. While we are not prepared to make any recommendation for a general
revision of rating in its application to electricity undertakings, as a whole, we
feel that this new transmission enterprise can be usefully considered apart, and
we recommend that it should be definitely provided that the transmission lines
and substations of the Board should not be liable to rates.
100. Railway Electrification.—Although the matter is perhaps not strictly
within our terms of reference, w e could not fail to note the effect which the
advent of the " gridiron " would have on the possibilities of the electrification
of British Railways. At the same time we have made no allowance in our
calculations for the possible demands over and above the present slow rate of
growth of the traction demand. We definitely recommend that the Board should
have power to supply Railways direct.
T
101. The existence of the " gridiron," the layout of which from! the point of
view of Avayleaves must necessarily conform in a considerable measure to that of
the railways, cannot but have a vital influence on reducing the amount of capital
required for electrification. The availability of ample supplies of cheap energy
from the " gridiron " would also relieve the Railway Companies from the
necessity of heavy expenditure for power stations. At the same time a railway
demand for energy, which might approximate to 20 per cent, of the whole national
demand for other purposes, would most favourably affect the national load factor
and thus reduce still further the cost of energy.
102. The position would be so radically altered that we think that if the
Government adopt our proposals generally, then at the same time they should
take steps to ensure that Railway Electrification is reviewed and reconsidered.
103. Sales of Electricity.-There has in the past been a serious lack of
organisation in the encouragement of the use of electricity, especially by domestic
consumers, which compares most unfavourably with the great enterprise shown
in America. We have had the benefit of the experience of Mr. Insull, of Chicago,
and Mr. Alexander Dow, of Detroit, and we find that in America the great supply
systems have developed the business of selling electricity into a very fine art,
with the result that there has been a rapid increase in the consumption of
electricity per head of population. There is active canvassing for new consumers;
existing consumers are encouraged to use electricity for all sorts of purposes;
and dissatisfaction is avoided and consumption increased by a free service of
lamps and certain parts of apparatus such as flat irons and domestic electrical
utensils.
104. In this country an attempt has recently been made to improve
conditions, and an organisation is now in being, the British Electrical Develop­
ment Association, which by growing propaganda is, we are advised, doing good
work and should be encouraged. There is, however, a good deal of restriction
which hampers expansion.
105. The restrictions are of three types. Partly they are due to the
diversity of practice among Authorised Undertakers, e.g., the large number of
pressures which tend to maintain the cost of appliances at a high level, the
numerous methods of charge and scales of prices, etc. We understand that the
Commissioners have recently appointed an Advisory Committee to enquire into
many of these points, and we have not therefore felt it necessary to consider
them in detail. We venture, however, to hope that the Advisory Committee will
be able to report quickly so that their recommendations, if requiring new
legislation, may be included in the Bill to effect the main purposes herein
advocated.
106. Partly the restrictions are legislative. Most Local Authority Under­
takers are prevented by their Acts from selling any electrical apparatus. No
such restriction exists in America, and it should be removed here. All under­
takers should be encouraged, not only to sell apparatus, but also to provide
showrooms and exhibit appliances with which they can demonstrate the numerous
practical applications of electricity in the home.
107. A third restriction arises from a tendency prevalent in this
country to regard the engineering side as necessarily being of higher
status and greater importance than the commercial side.
We under­
stand that this view is so deep-rooted that when an undertaking takes a bulk
supply and closes down its own generating station, it frequently happens that the
salaries of the staff are reduced on the ground that they are now only concerned
with sales. We consider this policy to be unsound. In our opinion it is obvious
that the interests of the consumers and the success of the undertaking depend
as much, if not more, on the efficient and enterprising management of the com­
mercial side as on the technical management of the stations. Where an under­
taking is small, it may happen that both duties must be entrusted to the same
staff, and it is probable in such cases that the enterprise as a whole will suffer
through attention being unduly concentrated on the engineering side. The staff
should be set free for work which is at once more lucrative for the enterprise,
and better for the consumers. If this essential work is to be performed to the best
advantage, the present attitude towards the engineering and commercial sides
must be profoundly altered. The work requires capacity of no mean order, and
the best available capacity should be employed. The freeing of officials from the
dual task of engineer and manager should be regarded, not as a lowering of
status, but as opening up a possibility of even more fruitful endeavour.
108.. Small consumers should be encouraged and electricity should, as far as
possible, be made available for the new housing schemes which are being
extensively developed. In America and elsewhere an electric supply would be
considered indispensable in such cases.
We are convinced that a wide scope
exists, and every effort should be made to demonstrate, especially in new districts,
the advantages which can be afforded by the use of electricity for a great variety
of useful purposes. All such steps would result in cheapening both the cost of
the supply and also the cost of the apparatus.
109. Conditions of Supply.—By the existing law undertakers are entitled
before giving a supply of electricity to require new customers to enter into a con­
tract to take such a supply as will give the undertaker a return of 20 per cent, on
the outlay incurred in giving the supply. The duration of the contract is two
years in the case of Distribution Companies, and seven years in the case of Power
Companies.
,
:
110. We recognise that undertakers should not be obliged to give a supply
at a serious loss to themselves, more particularly as this would tend to raise prices
and so penalise the community as a whole. On the other hand it must be borne in
mind that the undertaker enjoys a virtual monopoly in a public service. We think
therefore that the onus of proof should be laid on the company and not the con­
sumers. This is the practice in the U.S.A., where the duty of supplying is imposed
on the undertaker in every case subject only to a right of appeal to the State Com
mission. We recommend that a similar course should be adopted in this country.
111. Waste Heat, Water Power, etc.—We have already referred to the
utilisation of waste heat and water power, and we recommend that the Board
be given full powers to purchase energy from all economic sources. In making
the surveys and developing the layout of the transmission scheme we have outlined
for the future wholesale generation and transmission of electrical energy, the
following technical developments (some of which may be immediately realisable)
must be kept in view from the beginning and provided for, viz :—
(a) The existence of the " gridiron " as providing a free market for the
disposal of surplus energy will inevitably and in a valuable sense
extend the utilisation of waste heat stations, the economical use
of which is now limited to strictly local applications.
(b) Similarly, the " gridiron " opens up entirely new possibilities for
utilising small water power schemes, and much energy now wasted
throughout the country will be conserved by small automatic plants
selling and delivering current over the 24 hours into- the " gridiron."
(c) The possibilities of the large northern water power resources indicated
in the Water Power Resources Committee Report should be again
brought under consideration in view of their increased practicability
under the new circumstances.
(d) Progress in the successful low temperature carbonisation of coal may
hereafter influence the location of new power stations in relation
both to coal mines and to the larger gas undertakings.
112. Wayleaves.—The Williamson Committee made certain recommenda­
tions to ameliorate the position in which undertakers found themselves when­
attempting to obtain wayleaves. These recommendations were largely incor­
porated in the Acts of 1919 and 1922. Experience, however, has shown that
further amendment is desirable in certain respects, more particularly in connection
with the compulsory acquisition of land for the purpose of erecting overhead lines
and building sub-stations. We recommend that the necessary amendments should
be made.
113. Amendments to Legislation.—We have heard some evidence which
suggests that the machinery laid down by statute for administering the Acts is
in certain respects cumbersome and involves unnecessary delay. We have not
considered it necessary to investigate these points in detail, but we desire to record
our opinion that amendments to the law which experience has shown to be
desirable for the purpose of speeding up and improving the machinery of
administration, should be embodied in the new Bill.
114. Future Technical Developments.—In conclusion, we would add that as
our proposals involve large expenditure over a long period of time, Ave felt it
incumbent to establish whether or not there is any tendency in the development
of electrical technique which might render our proposals obsolete within the
period in question. We are advised that within the region of justifiable specula­
tion there is nothing to warrant hesitation.
Improvements will probably be made in transmission technique, but so far
as can be seen their influence on our proposals can only be of a favourable nature.
115. Summary.—It is customary to conclude reports of this nature with
a summary of recommendations. In view, however, of the many matters dealt
with and their complexity and interaction, we feel that a summary on the usual
lines would fail to give a clear picture of our proposals, and would also be wholly
inadequate for the preparation of a Bill.
116. In conclusion we desire to express our indebtedness to our Secretary,
Mr. O. A. Sherrard, for the assistance he has given us, and our appreciation of
his thoroughness and capacity.
We have the honour to be,
Sir,
Your obedient Servants,
W E I R (Chairman).
FORRES.
S. HARDMAN LEVER.
0. A. SHERRARD
(Secretary).
14th May, 1925.
A P P E N D I X 1.
ABSTRACT OF MEMORANDUM BY SIR JOHN SNELL, THE CHAHfc
MAN OF THE ELECTRICITY COMMISSION, ON THE EFFECT
OF A MAIN TRANSMISSION SYSTEM AND ELECTRICITY
GENERATED
IN CERTAIN
CAPITAL AND
SECONDARY
STATIONS WHEN AN AVERAGE ELECTRICAL CONSUMPTION
OF 500 UNITS P E R HEAD IS OBTAINED THROUGHOUT GREAT
BRITAIN.
(1) Exhibit No. 1 shows the distribution of sales with an average of 500
units per head.
The total is 21,385 million units sold, with a maximum
demand of 8,135,000 k.w. and an annual load factor of 30 per cent. It will
be noted that a consumption of 700 units per head has been adopted for the
industrial districts, 500 for the special case of London and the Home Counties,
and 300 or 255 per head for the other parts of the country.
(2) Exhibit No. 2.-Actual load curves, each extending over a period of
one week, have been obtained for both winter and summer for all the principal
Scottish undertakings. As these undertakings contain a fair admixture of
Power Companies and Local Authorities, they have been adopted as a basis for
the calculations which follow. In each of the winter and summer curves shown
the load curves of all the undertakings have been integrated so as to get a true
relation between winter and summer peak loads, and the high load factor
component.
These are as under :—
Winter Peak load, 160,700 k.w.
Summer Peak load, 100,000 k.w.
High Load Factor Component, 40,000 k.w.
The ratio of the high load factor component to the maximum load is in the
winter curve 41'5 per cent., and in the summer curve 44'4 per cent.
A similar combination of curves has been made for the district of Central
England and the relation of the load curves is essentially similar to those for
Scotland.
It has been assumed, therefore, that at least as good a curve for the whole
country would be obtained when complete interconnection has been made, the
probability being that a further improvement would be realised.
(3) Exhibit No. 3 shows selected existing stations in certain of the
districts, some of a capital station nature, others of a secondary station kind,
from which survey have been deduced certain further new capital stations, 15 in
number, required to meet the conditions in 1940.
In addition to 13 existing capital stations situated on the main waterways
and in proximity to coalfields, there are 30 secondary stations which are so
situated and equipped as to be worth retaining. It will thus be seen that 58 power
stations would take the place of some 490 out of the 541 stations in the country
at the present time. The remaining 51 stations are small in size and situated
in remote places not likely to be affected by the main transmission system for
a long time to come.
(4) Maps have been prepared of England and Scotland respectively, on
which the proposed new capital stations are shown in red, existing capital stations
in blue, secondary stations in green and the existing hydro-electric stations in
North Wales and the Scottish hydro-electric stations (under construction) in
violet.
The main arterial system of transmission is shown in red and is probably
as accurate and practicable a lay-out as can be devised at the present time with­
out making the complete field survey which would be necessary before this network
can be finally designed.
(5) Exhibit No. 4 is a detailed study of the capital cost and total working
expenses of the Scottish area when the prescribed stage of development has been
reached.
Shortly, it may be said that high tension untransformed energy could be
sold at an average price of 0'4c?. per unit and low tension energy, after all the
local detail charges have been added, including street distribution, at T038d. per
unit or round about Id. per unit.
Attention is directed to the two curves at the end of Exhibit 4, which show
these figures applied to various load factors.
(6) Exhibit No. 5.—A similar detailed study has been made of Central
England, the details of which are given in Exhibit No. 5, and from this it will be
seen that the results are very similar to those for Scotland.
(7) It may, therefore, be taken that these figures for Scotland and for Central
England can be applied as being approximately true for the whole country. The
result, as applied to the whole country, may be briefly summarised.as under :—
Estimated Figures
at.500 units sold
per head.
Actual Figures
1923.
Units sold per head by supply undertakings
Maximum load k.w. ...
K.W. Installed
Units sold
Annual load factor ...
Capital expended
,,
perk.w.i.
...
per k.w.d.
,,
,,
per thousand units sold...
Total Revenue
Revenue per £100 invested...
Average price per unit sold...
455-0
441-0
323-0
532-0
500
8,135,000
10,000,000
21,385,000,000
30%
£399,428,500
£30-94
£49-10
£18-68
£89,100,000
£22-3
110
1,844,000
3,096,000
4,016,000,000
24-9%
£161,750,000
£52-25
£87-7
£40-3
£34,256,000
£21-2
2-047^.
Growth
per cent.
247-0
- 23-6
-44-0­
-53-6
260-0
5-2
- 48-8
Id.
(8) If individualistic' development continued, further improvement and a.
reduction in the present average cost of energy would certainly be attained,
though not to the degree possible by the transmission scheme. I t is not possible
actually to estimate the reduction attainable by individual development. Were
the average price per unit sold reduced from 2047d. to- Tl'5d., then the scheme
would show a total annual saving of £66,800,000 when the units sold amounted
to 500 per head.
Were the average price reduced from 2'047c?, to V5d., the annual saving
effected by the scheme would be £44,550,000. That is to say, at the best possible
valuation of individual development the public would have to pay over 44 millions
more in each year than they would pay under the Scheme.
(9) There are a few general observations of a detailed character which it
may be interesting to put on record.
(a) While 23 per cent, of spare plant only is allowed for in the scheme­
at the time of winter maximum load—it is to be observed that
during seven months of the year (due to the reduced summer demand)
the spare plant would be increased to 50 per cent, or thereabouts,,
thus allowing an ample margin of plant and time for complete
overhaul.
(b) Calculations have been made by the Ministry of Transport of the total
consumption of electrical energy by British railways were the whole
of the lines to be electrified. The result is a total output of
6,862,000,000 units (equivalent to a sale of 160 units per capita)..
At a load factor of 40 per cent, this output is equivalent to a
maximum demand of 1,985,000 k.w., or practically 2,000,000 k.w.
As some 2,138,000,000 units may be assumed in any case to be
included in the sales when the total consumption of the country is
500 per capita, it follows that main line electrification on a big
scale would add a further 4,724 million units with a maximum
demand of 1,350,000 k.w. The total consumption per head of
population would then be raised from 500 to 610 units.
(c) The existence of a main transmission system would encourage! the­
development of water power, the sources of which are (excepting
North Wales and certain large Scottish schemes now under con­
struction) generally remote from any likely distribution area at the
present time. When it is remembered that a modest computation
of the available water power in Great Britain amounts to
265,000 k.w. continuous output (equivalent to, say, 2,120,000,000
units per annum) as shown by the Report of the Water Power
.
'
Resources Committee, or about one-tenth of the total output
throughout the country when a sale of 500 units per head is reached
—-it is evident that in the interests of the community so important
a source of power must not be neglected. A general transmission
network when established will enable these sources of power to be-,
economically used.
a
:
"vT:.'.-^-^rrft-7rTr?eM^
"
-
.
"
Exhibit No. 1.
ESTIMATED FIGURES FOR 1940.
units per cap: will reach 2 1 , 3 8 5 , 0 0 0 , 0 0 0 units.
Average 3 0 per cent, load factor = 8,135,000 k.w.
500
District.
Lower Severn
Mid Lancashire
South East Lancashire
West Riding ...
...
..;
Mersey and West Lancashire
North Wales ...
London and Home Counties
North West Midlands
North East Midlands
South West Midlands
East Midlands
South Wales ...
North Lancashire
Kent
South East Midlands
Berks., Bucks., etc.
N o r t h East Coast
Westmorland...
Eastern Counties
Southern Counties ...
Devon and Cornwall
West of Scotland
Lothians
Central Scotland
South Scotland
North Scotland
Great Britain ...
...
Population.
Units Sold.
Thousands.
1,449
985
2,862
2,202
1,796
805
8,265
1,367
1,284
1,516
1,455
2,066
263
803
1,703
Millions.
434-7
689-5
2,003-0
1,541-0
538-8
241-5
4,130-0
957-0
898-5
1,060-5
1,018-0
1,445-0
78-9
24-9
210-9
3,334
278.
2,160
2,166
1,127
2,173
554
587
354
1,215
...
Unite, Sold
per capita.
2,333-0
70-9
550-5
552-5
286-9
1,522-0
166-2
176-1
90-2
364-5
42,769
21,385-0
300
700
700
700
300
300
500
700
700
700
700
700
300
300
300
700
255
255
255
255
700
300
300
255
300 .
500
Maximum
demand.
Load Factor
(on units
sold).
K.W.
198,500
254,500
737,500
567,500
220,0U0
11,500
1,682,000
352,500
331,000
390,500
374,500
532,500
38,000
11,500
96,500
Per cent.
25-0
31-0
31-0
31-0
28-0
24-0
28-0
31-0
31-0
31-0
31-0
31-0
24-0
25-0
25-0
701,500
34,500
267,500
268,500
139,500
560,500
79,500
67,500
44,000
173,500
38-0
23-5
23-5
23-5
23-5
31-0
24-0
30-0
23-5
24-0
30
8,135,000
NOTE.—It is recognised t h a t these figures represent only an arbitrary sub-division for the
purposes of illustration, and t h a t there are a few districts which, are already approaching the
1940 estimate. With the adoption of a comprehensive economic scheme it is probable that this
average consumption will be reached long before 1940.
Exhibit No. 3.
Y e a r 1922--23.
Area
No.
District.
S.l. West
of
Scotland.
Units
Output,
Thou! sands.
Maximum
Demand,
k.w.
1940.
Units
Output,
Thousands.
Maximum
Demand,
k.w.
Ultimate.
Plant available.
Station.
Steam
Total
Total
Effective
Largest PresPlant
Plant
Capacity,
sure,
Unit,
Capacity,
Installed,
k.w.
lbs. per
k.w.
k.w.
k.w.
sq.in.
294,041 140,778 1,522,000 560,500 Dalmarnock 131,250 18,7501 275
Yoker
35,750 18,750! 225
Clydesmill
49,500 18,750 225
Greenoek... 25,000 7,000 250
Kilmarnock
20,000 10,000 250
Totals
261,500,
Remarks.
Set spare.
168,750 150,000 One 18,750 k.iv
100,000 81,250
150,000 131,250
40,000 30,000 One 10,000 k.wi
40,000 30,000
[ 498,750! 422,500,
K.W.
Maximum demand 1940 ...
...
...
...
Ultimate total capacity of existing stations ...
560,500
498,750
Additional plant t o be provided (without spare)
Add 20 per cent, of 560,500 k.w. for spare ...
61,750
112,100
173,850
Total additional plant required in area, after above existing stations
are extended to the limit of their capacities
(say) 175,000 k.w
Year 1922-23
r e a
16
i District.
MaxiUnits
mum
Output,
Thou- Demand,
k.w.
sands.
1940.
Units
Output,
Thousands.
Maximum
Deman (1,
k.w.
P l a n t available.
Ultimate.
Steam
Total
Total
Largest PresPlant
- Plan t Effective
sure,
Unit,
Capacity.
Installed.
lbs.per Capacity.
k.w.
k.w.
k.w.
k.w.
sq.in.
Station.
33,000
N.E. 552,676 182,889 2,333,000 701,500 Hull
55,000
Carville B.
Coast.
Dunston ... 78,850
N. Tees ... 100,000
Set spare.
200 60,000 50,000 One 10,000 k.w.
275 100,000 80,000
,, 20,000 k.w.
,, 35,000 lew.
200 180,000 145,000
,, 35,000 k.w.
425 S250,000 215,000
i
10,000
11,000
15,000
20,000
1
1
Totals ... 176,850
Maximum demand 1940
Ultimate total capacity of existing stations
...
spare)
Additional plant to be provided (without
Add 20 per cent, of 701,500 k.w. for spare plant
Remarks.
Remarks .
590,000 490,000
...
...
...
K.W.
701,500
590,000
...
...
...
...
111,500
140,800
251,800
Total additional plant required in area, after above existing stations
are extended to the limit of their capacities
...
...
...
Year 1922-23
rea
'o.
District.
Units
Output
Thousands.
Maximum
Demand.
k.w.
P l a n t available.
1940.
Units
Output
Thou-'
sands.
Maximum
Demand,
k.w.
Station.
8 ]S .W. 272,971 151,013,2,017,500 743,000. Nechells
nd Midpermanent
10. lands
(Birming­
and
ham).
S.W.
Mid­
lands,
Stour port...
T
Totals
(say) 252,000 k.w.
Ultimate.
Steam
Total
Total
Effectve
Largest PresPlant
Plant
sure,
Unit,
Installed.
Capacity Capacity,
k.w.
lbs. per
k.w.
k.w.
k.w.
sq. in.
90,000 15,000
320
110,000
30,000 15,000.
350
125,000 105,000
120,000
Remarks.
90,000
235.000 195,000
Maximum demand 1940 ...
Ultimate total capacity of existing stations ...
748,000
235,000
Additional plant to be provided (without
spare)
Add 20 per cent, of 743,000 k.w. for spare plant .
508,000
148,600
656,600
Total additional plant required in area, after above existing stations
are extended to the limit of their capacity
...
..
....
(say) 660,000 k.w.
The following have been, put before the Commissioners as new stations: —
Ultimate
k.w.
Installed.
k.w.
Effective.
Birmingham ( H a m s Hall) ...
300,000
265,000
Ironbridge
150,000
Stone
...
...
...
30,000
Rugeley
120,000
-':
20,000
80,000
60,000
560,000
Year 1922-23.
Area
No.
District.
Units
Output,
Thousands.
Maximum
Demand,
k.w.
1940.
Units
Output,
Thousands.
Maximum
Demand,
k.w.
2 , 3 Mid. 764,538 369,090 3,231,300 1,212,000
a n d Lanes.,
5.
S.E.
Lanes.
and
Mersey
and
W.
Lanes.
Minimum sammer flow.
5,700,000 galls, per hour natural
water to be increased by im­
pounding to 8,400,000 galls,
j
per hour.
1,750,000 galls, per hour natural
flow.
3,300,000 galls, per hour natural
How.
465,000
-
Plant available.
Ultimate.
Steam
Total
i lTotal
a n
ffective
Plant Largest Pres. 1 ; I BCapacity
sure, Capacity,
p
Installed, Unit,
£
lbs.
per
k.w.
lew.
k.w.
sq. in.
i
Scat:
Blackburn
20,000 10,000
(Whitebirk)
Preston
20,000 10,000
(Ribble).
Padiham ... 12,000 6,000
Bolton
... i 46,500 12,500
Manchester ' 106,750 25,000
(Stuart St.)
Manchester
82,500 27,500
(Barton).
Oldham ... 32,000 6,000
Salford
37,500 18,750
(Ageci oft).
Stockport...
40,500 10,000
Radcliffe ... 48.375 10,000
Liverpool...
91,000 25,000
Percival
25,000 12,500
Lane.
!
210
60,000
Remarks
50,000
325
125,000] 100,000
250
215
200
50,000
46,500
106,750
375
167,500 140,000
215
300
32,000
100,000
200
165
200
270
40,500 30,500
48,375 38,375
91,000 66,000
1-25.000 100,000
37,500
34,000
81,750
26,000
75,000
992,625 779,125
Totals
1,212,000
992,000
M a x i m u m demand 1940 ...
Ultimate total capacity of existing stations ...
220,000
242,4-00
Additional plant to be provided (without spare)
Add 20 per cent, of 1,212,000 lew. for spare plant
462,400
Total additional plant required in area, after above existing stations
are extended to the limit of their capacities
(say) 462,000 ii
T h i following have been put before the Commissioners as new stations: —
Oldham (Chadderton)
Wigan ...
Lancashire E. P. Co. (Kearsley)
Manchester (Carrington)
Stockport (Cheadle)
Ultimate
k w.
Installed.
k w.
Effective.
Remarks.
100,000
80,000
100,000
150,000
50,000
75,000
60,000
75,000
125,000
30,000
Cooling Tower Station
Natural Water.
Half only Natural Water.
Natural Water.
Includes 10,000 k.w. CoolingTowers.
480,000
365,000
Year 1922-23."
I
rea
District.
Units
Output
ThouSandb.
11
i
1
West
Riding.
Maximum
Demand,
k.w.
269,766 127,998
;
1940.
Units
Output
Thousands.
P l a n t available.
Maximum
Demand,
k.w.
Steam
Total
Total
Effective
Largest PresPlant
Plant
sure,
Unit,
Capacity,
Installed,
lbs. per Capacity,
k,w.
k.w.
k.w.
k.w.
sq. in.
Station.
154,100 567,500 Bradford ...
Leeds
Thornhill
Ferrybridge
Totals
j
i
Ultimate.
64,000
79,000
40,000
30,000
20,000
12,000
12,500
15,000
210
200
200
325
... 213,000
Remarks.
64,000 44,000
79,000 67,000
75,000 60,000
180,000 150,000
398,000 321,000
Maximum demand 1940 ...
Ultimate total capacity of existing stations
576,500
398,000
Additional plant to be provided (without spare)
Add 20 per cent, of 567,500 k.w. for spare plant
169,500
113,500
283,000
Total additional plant required in area, after above existing stations
are extended to the limit of their capacities
Year 1922-23.
area District.
So.
Units
Output
Thousands.
Maximura
Demand,
k.w.
1940.
Units
Output
Thousands.
Maxim ran
Demand.
k.w.
Plant available.
Station.
1 1
lands,
E. Midlands,
S.E.
Midlands.
Ultimate.
Steam
To:al
Total
Largest PresEffective
Plant
Plant
sure, Capacity Capacity,
U
n
i
t
,
Installed,
lbs. per
k.w.
k.w.
k.w.
k.w.
scj. in.
N.E. 357,509 195,993 2,127,400 802,000 Rotherham
jand
Mid15
(say) 285,000 k.w.
Sheffield
(BlackburnMeadow).
Derby
68,000 30,000
48,000 10,000
220
190
27,500 10,000
300
50,000! 30,000
50,000
30,000
100,000
80,000
Remarks.
70,000
60,000
Leicester
(Central).
20,000 10,000
Nottingham
(N.Wilford)
Spoudon ...
Avon
30,000 10,000
17,000 k.w.
i natural water
balance
250
60,000 50,000
with cooling
towers.
250 200,000 175,000
24,000 12,000
12,000 6,000
215
260
Totals
... 229,500 88,000
40,000
20,000
570,000 445,000:
Maximum demand 1940 ...
Ultimate total capacity of existing stations ...
K.W.
802,000
570,000
Additional plant to be provided (without
spare)
Add 20 per cent, of 802,000 k.w. for spare plant
232,000
160,400
392,400
Total additional plant required in area., after above existing stations
are extended to the limit of their capacities
(say) 400,000 k.w
Tear 1922-23.
Area
No.
District.
Units
Output
Thousancls.
1940.
Maxi-
Units
Output,
Thousands.
Demand,
k.w.
Plant available.
Maximum
Demand,
k,w.
Ultimate.
Steam
Total
Largest PiesPlant
Unit,
sure,
I In stalled.
k.w.
lbs. per
k.w.
sq. in.
Station.
Fulham ... 12,000: 6,000:
Stepney ... 40,000 10,000
London 714,978 417,975 4,130,00011,682,000 Bankside ... 45,000 15,000
Barking ... 100,000! 35,000
Deptford ... 60,000 15,000
26,000 10,000
Poplar
35,500! 12,500
Marylebone
80,000 15,000
Grove Rd.
64,000 15,000
Bow
Met. Co. ... 72,000 20,000
:
!
275
200
260
375
200
200
350
210
260
275
Remarks.
80,000: 60,000:
70,000 50,000
80,000 60,000
600.000 500,000
70,000 55,000
55,000 40,000
50,000 35,000
80,000! - 65,000
75,000 60,000
75,000 55,000
1,235,000 980,000
534,500
Totals
Total
Effective
Plant
Capacity, Capacity,
k.w.
k.w
K.W.
1,682,000
1,235,000
Maximum demand 1940 ...
Ultimate total capacity of existing stations ...
Additional plant t o be provided (withotit spare)
Add 20 per cent, of 1,682,000 k.w. for spare ...
447,000
336,400
783,400
Total additional plant required in area, after above existing stations
are extended to the limit of their capacities
Year 1922-23.
Area
Are a
No.
No .
12
District.
District .
Units
Output
Thousands.
Maximum
Demand,
k.w.
i
Plant available.
1940.
Units
Output
Thousands.
Maximum
Demand,
Station.
k.w.
Total
Largest
Plant
Installed. Unit,
k.w.
South 117,209 46,951 1,445,000 532,500 Cardiff
...
Newport ...
Wales.
Swansea ...
S. Wales
Power Co.
k.w.
21,000 5,000
21,750 10,000
20,000 10,000
41,000 15,000
Totals^ ... 103,750
(say) 785,000 k.w
Ultimate.
Steam
Total
PresEffective
Plant
snre,
Capacity, Capacity.
lbs. per
k.w.
k.w.
sq. in.
200
260
200
200
21,000
50,000
65,000
75,000
Remarks
Remarks..
16,000
40,000
50,000
60,000
211,000 166,000
Maximum demand 1940 ...
Ultimate total capacity for existing stations, ...
K.W.
532,500
211.000
Additional plant to be provided (without
spare)
Add 20 per cent, of 532,500 lew. for spare plant
321,500
106,500
428,000
Total additional plant required in area, after above existing stations
are extended to the limit of their capacities
(say) 430.000 k.w
* In addition there is a total of 132,000 k.w. of plant installed in private generating stations
in the area with a total maximum demand of 60,000 k.w.
1
Exhibit No. 4.
SCOTLAND.
Distribution of loads among selected stations and total cost of generating
H.T. untransformed. 3 phase energy (including annual capital charges) when
units sold average 475 per head of population in that area.
Data.—Coal 16s. per ton (10,500 B.Th.TJ.) delivered, including handling and
removal of ashes : Interest and Sinking Fund in Local Authorities' stations, 8 per
cent.; Interest and Depreciation in Power Companies' stations, 10 per cent.
Generating Station.
K.W.D.
High. Load Factor Stations—
Grampians H.E. ...
tFalls of Clyde H.E.
No. 1 Capital Station
Load Factor Capital
Stations—
No. 1 supplemental
Dalmarnock
Clydes Mill
*Yoker (winter only)
Portobello ...
Units sent
out in
millions.
Anual Load
Factor.
Cost of
Generation.
Cost per
Unit
sent out.
Per cent.
£
d.
80,000
10,000
.130,000
343-0
44-0
769-0
50-0
50-0
67-5
397,000
45,800
805,700
0'2778
0-2500
0-2515
87,000 J
150,000
131,000
81,000
100,000
250-0
332-5
292-7
99-8
218-4
32-8
25-3
25-3
14-0
25-0
384,280
557,280
530,400
285,920
357,752
0-3689
0-4022
0-4348
0-6876
0-3930
30,000
30,000
20,000
37-0
' 37-0
24-6
14-0
14-0
14-0
91,930
95,418
78,900
0-5964
0-6190
0-7691
Low
Secondary Stations—
*Kilmarnock
...
*Greenock ...
* Dundee
...
3,630,380
0-356
33-0
(aver.)
* These four stations are assumed t o be shut down, during t h e summer six or seven months.
I This water power at thei F a l l s of Clyde is intermittent in character varying from 4j,00G
to 13,000 k.w., b u t the annual output is stated to be n o t less than 44 million units sent out.
(For details of cost of generation see Annex t o Appendix 1.)
Totals and averages ...
849,000
2,448-0
The cost and details of main transmission lines are given in Appendix B.
The estimated capital expenditure would be approximately £3,000,000.
The distribution and management expenses, plus local rates on the whole
undertaking (excluding rates on main transmission already provided for) and in­
cluding capital charges (taken at 7^ per cent.), is actually in the case of the Power
Companies 0"423ci. per unit sent out and 0'8rf. in the Local Authorities. Com­
pounded, the average to-day is 0'666c?. This figure must be considerably reduced
by reason of a bigger system, a larger proportion of overhead mains and the
cheaper A.C. distribution in nearly all future extensions.
It is considered to be a very safe figure to adopt 0'5af. per unit sent out as
applying at the 1940 stage.
Estimated total costs of electricity supplied.
Per unit
sent out.
d.
(a) Generating . costs per unit sent out from
stations (coal at 16s. per ton)
...
... 0 356
(b) Operating expenses and capital charges on
main transmission lines, including local
rates—see Appendix B ...
...
... 00265
j
03825 or 0M. per high
tension unit sold.
(c) Local distribution expenses, including capital
charges, total management costs and local
rates
O5000
08825
or at an average distribution efficiency of 85 per cent, (the present average)
0'8825(i. ^-85 = 10386?. average cost per low tension unit sold to consumers.
Applying this average cost to various classes of consumers at different load
factors, the prices charged could be as in the two curves shown on Appendix C
the lower curve A being for high tension
energy
supplied to large power
consumers, in bulk to authorised undertakers and to high load factor consumers,
such as chemical industries or collieries, for ventilation and pumping; and
i C u r v e B being the average price for loiv
tension
energy
supplied to consumers
after street distribution has been charged for, whether the supply be A.C. or
converted to direct current. It will be seen from the former curve A that bulk
supplies and ordinary large power consumers could be dealt with at less than
a halfpenny per unit and high load factor chemical consumers, &c, under one-third
of a penny. From curve B it will be s e e n that small supplies f o r house lighting
would vary between I f d and 2fd. and small power and domestic supplies would
average less than l\d.
These figures a r e certainly on the high side, as curve B is derived from
existing distribution costs in Scotland, a large proportion of which is on the
direct current system, and material economies would be gained in future by a.
bigger utilisation of the simpler and cheaper alternating current system.
I t must also be observed that all these figures a r e based o n coal at 16s. per
ton, and a reduction in the price of coal would correspondingly reduce the figures
in the curves.
I t is difficult to estimate the amount of plant involved if individual develop­
ment w e r e to continue, but approximately an additional 132,000 k.w. o f plant
would be required, costing about £2,000,000.
The transmission system for the scheme includes a part also necessary if
individual development w e r e continued, particularly that part enabling the
Grampians Hydro Electric Scheme to supply the Fife Power and Central Power
Companies. The extra cost of the scheme of transmission system over and above
that necessary part is £1.800.000.
The total capital, therefore, is very much the same under the scheme o r
under individual growth, but the cost of energy under the former must obviously
I e less. The pooling system is safer and much n e w territory is opened up by the
scheme.
Exhibit No. 5.
CENTRAL ENGLAND.
Distribution of loads among selected stations and total cost of generating
H.T. Untransformed 3 phase energy (including annual capital charges) when units
sold average 612 per head of population in that
Data.—Coal
16s. per ton (10,500 B.Th.U.) delivered, including handling and
removal of ashes : Interest and sinking fund in Local Authorities' stations, 8 per
cent.; interest and depreciation in Power Companies' stations, 10 per cent.
Source.
H.L.F.. Stations
H.L.F
Stations..
Ironbridge
Ironbridg e
N . Wilfor
Wilfordd
..
....
..
....
Stourpor
Stourportt
U.S.O. in M.
:.
:...
Othe
Otherr Station
Stationss (L.L.F.
(L.L.F.))
H.L.F
H.L.F.. Station
Stationss a s abov
abovee
Spondon
Spondo n
Rngele
Rngeleyy
Hams
Ham s Hal
Halll
Nechells*'
Nechells* '
Leicester
Leiceste r
Warwick'''
Warwick'' '
Derby
Derb y *
Draw
Drawnn fro
from
m othe
otherr district
districtss
A.L.F.
per cent.
Total Cost
per U.S.O.
Amount.
£
K.W.D.
420 - 9
735-0
420-9
60
60
60
0-2656
0-2656
0-2656
465,800
813,400
465,S00
80,000
139,800
80,000
1576-8
60
0-2656
1,745,000
299,800
33-7
33-7
33-7
31-6
31-6
33-7
31-6
31-6
31-6
0-3689
0-4200
0-3422
0-3544
0-6134
0-3983
0-8935
0-6677
0-5000
(say)
454,500
206,690
252,500 .
1,082,450
319,272
245,018
103,130
115,741
469,792
100,200
40,000
60,000
265,000
90,000
50,000
20,000
30,000
162,500
35-4 av.
0-3456
4,994,093
295-7
118-1
177-.1
733-0
124-9
147-6
27-7
41-6
225-5
3468-0
I 1,117,500
* These three stations are assumed to be shut down during the summer six or seven mon
(For details of cost of generation see Annex to Appendix 1.)
The cost and details of main transmission lines are given in Appendix B ,
the estimated capital expenditure being approximately £3,632,000.
The cost of L.T. distribution, management and local rates on the whole
undertaking (excluding the main transmission system already provided for) and
including capital charges on distribution are taken at 0 5d. per unit sent out at
the 1940 stage of development, as in the case of Scotland.
Estimated total costs of electricity
(a) Generating costs per unit sent out from
stations (coal at 16s. per ton)
(b) Operating expenses and capital charges
on main transmission lines, including
local rates
supplied.
Per unit :
sent out.
d.
03456
00291
03747 or 039(1 per high
-tension unit sold.
(c) Local distribution expenses, including
capital charges, total management
costs and local rates ...
05000
0-8747
or at an average distribution efficiency of 85 per cent, the average price per
low tension unit sold to consumers would be 1029^.
Applying this average cost to various classes of consumers at different load
factors, the prices which could be charged are as shown in the two curves given
on Appendix C, the lower curve A being for high tension energy supplied to
large power consumers, in bulk to authorised undertakers and to high load
factor consumers, such as chemical industries or collieries for ventilation and
pumping purposes. Curve B shows the average price for low tension energy,
either D.C. or A.C., supplied to consumers after street distribution has been
charged for. I t will be seen that the figures are very similar to those for the
Scottish district.
A N N E X TO A P P E N D I X
I.
ESTIMATED COST OF A RIVERSIDE CAPITAL STATION OF 133,000 K.W. INSTALLEDCAPABLE OF MEETING A MAXIMUM LOAD OF 100,000 K.W. FIGURES BASED ON
THE BARKING CONTRACTS.
I.
£
£ per K . W I .
(a) Land as at Barking-308 acres
...
...
(b) Civil engineering works, piling, wharfs, rail-,
wav sidings, roads, water culverts and screens
and foundations
(c) Buildings (above raft) and cranes
id) 3 * 33,000 k.w. turbo alternators (economic
rating), condensers, reheaters and pumps,
plus 2 x 15,000 k.w. sets
...
(e) Boilers (1,250,000 lb. total evaporation), 375
lbs. per square inch, stokers, superheaters,
balanced draught fans, auxiliary plant and
ash removal plant
...
--.
(/) Switchgear and cabling ...
ig) Transformers, step-up, and station auxiliaries
97,500
0-733
250,067
229,000
1-880
1-722
525,312
3-950
460,800
90,840
78,860
3-464
0683
0-593
I.—continued.
'\
£
(h) Pipework, steam, water, feed, &c. ...
...
\i) Coal storage equipment (cranes, grabs, loco­
...
...
motives, wagons, &c.) . . . . ...
(j) Sundries (battery and charging sets, oil coolers
and pumps, oil filter plant, auxiliary sets and
wiring, fittings, &c.)
(say)
Add for engineering supervision, legal and
incidental expenses (5 per cent.)
61,840
£ per K . W . I .
0-465
19,678
0-148
40,000
0-301
1,853,897
13-939
92,700
£1,946,597
0-697
£14-636
II.
Cost of Units Delivered to Feeders from 100,000 K.W.D. Station operating
at an annual load factor of 60 per cent. :—
Data:
Maximum demand : 100,000 k.w.
Units generated: 525-6 millions.
Units delivered to feeders : 483-6 millions.
Coal assumed thermal value 10,500 B.Th.U. at 165. per ton delivered
including handling.
Consumption per Kilowatt hour delivered to feeders 17,000 B.Th.U. or
1-619 lbs.
Superintendence, repairs and maintenance, wages and stores, taken at the
actual observed figures at Dalmarnock Power Station.
Interest taken at 5 per cent., and sinking fund on the Commissioners'
usual periods for repayment based on 3^ per cent, table.
Amount.
£
279,600
100,740
155,013
Coal
S u p e r i n t e n d e n c e , w a g e s , repairs,
repairs , store s
A n n u a l capita l c h a r g e s
535,353
*
Pence
P e r cent.
52-2
18-8
29-0
per unit.
0-1387
0-0500
0-0769
100-0
0-2656
NOTE.—The sinking fund or depreciation is based as under :—
Sinking Fund (3^ -per cent. Table).
Capital
expended.
P e r cent.
cent .
Land
...
...
...
C i v i l e n g i n e e r i n g w o r k s and
an d b u i l d i n g s
Plant
Supervision, etc.
60 y e a r s
30 y e a r s
20 y e a r s
Average
. ....
. ..
..
. ..
..
...
0-509
0-509
1-9377
1-93
3-53
3-5366
2-964
2-964
Annual
amount.
£
97,500
479,067
1,277,330
92,700
496
9,280
45,169
2,747
1,946,597
57,683
LOAD CURVES.
CENTRAL E N G L A N D
EXHIBIT N ? 2 .
NORTH W E S T M I D L A N D S , S O U T H W E S T M I D L A N D S A N D E A S T M I D L A N D S
6
12
6
12
6
12
6
12
6
12
6 - 12
6
NOON RM. MID, AM, MOON RM. MID. AM. NOON RM. MID A.M. NOON RM.
W
. TUESDAY
WEDNESDAY
THURSDAY
1 8
I0ND
COMBINED.
12
6
12
6
12
6
12
6
12
6
12
6
12
MID. A.M. NOON EM. MID. A.M. NOON RM. MID. A.M. NOON RM; MID.
FRIDAY
SATURDAY
SUNDAY
f/blby &. Sorta, i-ith.
LOAD
CURVES.
WEST OF SCOTLAND,CENTRAL SCOTLAND,EAST OF SCOTLAND AND DUNDEE COMBINED .
EXHIBIT!N 2l
0
160,000
140,000
120.000
w 100,000
i­
i­
^
q 8o,ooo
12
6
12
6
MID. A.M. NOON P.M
MONDAY
22S7,
laSW
766/130,150,3.26.
12
MID.
6
12
6
12
AM. NOON P.M. MID.
TUESDAY
6
12
6
12
6
12
6
12
6
18
6
12
6
12
6
12 6
A.M. NOON P.M. MID. A.M. NOON P.M. MID. A.M. NOON P.M. MID.- A.M. NOON P.M. MID.
FRIDAY
SATURDAY
WEDNESDAY '
THURSDAY
CENTRAL
ENGLAND.
APPENDIX . C.
LU
o
z
a
20
IOpERCEsrl5
25
30
35
C O N S U M E R S
40
45
L O A D
50
Melby & S o n s , Lith.
F A C T O R .
SCOTLAND
UJ
O
B
z
APPENDIX C.
POSSIBLE AVERAGE PRICES TO CONSUMERS
B
ANNUA
ANNUAL
L
A
LOAD FACTORHT
.U
. NTRANSFORHEP L T - AC & DC
PERCENT
PERCENT
PENCE
PENCE
0 35
3533
2-8I8VUFTS
2-8I8VUFTS
10
0
68
686
6
l;786
l;786J
J LIGHTING
IS
0*550
*550-- D I I I k
20
I-3871SMALL
04691
0469 1 luPPUE
luPPUES
S 1 143
25
143 POWERi
0-414/fl.ARG
-414/fl.ARGE
.ARGE
30
0 378JD0IIESTI
378JD0IIESTIC
C
0-375
0-375 /FOWER 0-86
35
-861
1
40
0
773
77
3
n^sllCOlilERIES
n^sllCOlilERIE
S 0-704
45
-704
0 305ICHEMICA
305ICHEMICAL
L 0-65
50
-650
0
0 290
290ff &
55
0-60
0-6055
60
LrJ
a.
A
0-278INETAIUISOCA
-278INETAIUISOCAL
L 0-56
-568
8
asvggrg P
EO(Blll ie .SUPPLIF 3 S
TO Dr.
LARGE POWER
CONSUMERS LOAD FACTOR
Mai by & Sons, Lith.
APPENDIX 2.
PHNCLUSIONS OF TECHNICAL ADVISORY COMMITTEE ON THE
" MEMORANDUM BY THE CHAIRMAN OF THE ELECTRICITY
COMMISSION."
We have accepted the statistics on which the Memorandum is based.
We have also considered the detailed estimates on which the figures in the
Memorandum are based.
The conclusions at which we have arrived are as follows :—
(1) C o s t of N e w C a p i t a l S t a t i o n s . — W e have taken a figure of £14 per
k.w. of Maximum Continuous Rating in our calculations for new capital
stations.
(2) R e s e r v e P l a n t . — W e consider that 10 per cent, reserve plant capacity
is ample for the proposed conditions.
(3) C o s t of G e n e r a t i o n . — W e consider that allowing for the above and
other considerations, the cost per unit sent out from new capital stations will
be at least 10 per cent, below the estimate on which the Memorandum is based.
(4) L o a d F a c t o r . — E x h i b i t N o . 1.—We consider that when a sale of 500
units per head has been reached for the whole country, the average load factor
for the proposed conditions will certainly not be less than 35 per cent, as compared
with the average load factor of 30 per cent, assumed in the Memorandum. This
reduces the estimated maximum demand in each district and consequently the
amount of plant required at that stage of development
(5) C o s t of T r a n s m i s s i o n . — W e consider that the transmission costs,
including capital charges, will be 10 per cent, above the estimates on which the
Memorandum is based.
(6) D i s t r i b u t i o n E f f i c i e n c y . — W e consider that, for the country as a whole,
a distribution efficiency of 85 per cent, is sufficient to allow for all losses from the
high pressure busbars of the generating stations to the consumers' terminals.
(7) C o s t of d e t a i l e d D i s t r i b u t i o n . — T h e cost of detailed distribution stated
as 0500 pence per unit sent out, which is equivalent to 0'588 pence per unit sold,
represents more than half the total cost of each unit sold. It may be assumed
that the costs of detailed distribution would be the same whether a National
Transmission Scheme is adopted or not. The estimate appears to be very
reasonable, especially for the more densely populated areas.
(8) E x h i b i t N o . 4 . - S c o t l a n d . — B a s e d on the above, and assuming an
annual output of 2,448 million units, our estimate for Scotland is as follows :.- Pence per unit
sent out.
Generating Costs ...
...
. . . . ...
0311
Transmission Costs
...
0 029
Local Distribution as in the Memorandum
...
...
0500
Total Annual Cost
0'840
The average cost per unit sold to consumers, at 85 per cent, distribution
efficiency, would therefore be 0'988 pence, as compared with 1"038 pence given
ni the Memorandum.
(9)
E x h i b i t N o . 5 . — C e n t r a l E n g l a n d . — O n the same basis, and assuming
an annual output of 3,468 million units, our estimate for Central England is
as follows :—
Pence per unit
sent out.
Generating Costs ...
...
...
...
...
... 0'314
Transmission Costs ...
...
...
...
...
... 0'030
Local Distribution as in the Memorandum
...
... 0'500
Total Annual Costs
0-844
The average cost per unit sold to consumers, at 85 per cent, distribution
efficiency, would therefore be 0993 pence, as compared with 1 029 pence given
in the Memorandum.
(10) Lancashire District.—The South East Lanes., Mid Lanes, and Mersey
and West Lanes. Districts have been investigated as a check on Exhibits Nos.
4 and 5, and we find that on the sarnie assumptions the average cost per unit sold
to consumers works out at 1'037 pence.
(11) Location of Generating Stations.—We are not in complete agreement
with the locations indicated for some of the future extensions of generating
plant, and it is probable that with the reduction in reserve plant and the increase
in load factor, referred to above, the requirements could be met by a rather more
economical grouping of stations than that proposed in Exhibit No. 3. As such
modifications would not affect adversely the financial conclusions of the Memor
andum, we have not investigated the proposed location and plant capacity of
generating stations other than to estimate the total amount of plant required Per
the districts of Scotland, Central England and Lancashire.
(12) Routes of Transmission Lines.—We have not investigated in detail
the proposed routes for the high tension transmission lines, but in our estimates
we have allowed sufficient margin to cover all probable difficulties which may be
encountered, provided that the position as regards obtaining wayleaves is
improved.
(13) Summary of Conclusions.—-The foregoing conclusions are based on the
assumption that the standardisation of frequency throughout the /country is
deemed to be technically possible and economically justifiable on national grounds,
but that the cost thereof is not debited against the cost of electricity.
The Technical Scheme outlined in the Memorandum is based on a system
of interconnecting lines throughout the country coupled with the generation of
electricity in the more economical stations. We consider that the additional
electrical requirements of the country—which must be very large----can be most
economically dealt with in this manner.
The actual estimates are necessarily based upon the assumption that no
unforeseen and fundamental changes take place in the cost of labour, coal and
plant. Generally speaking, however, any increase in these items would relatively
improve this method of developing electricity supply as compared with present
methods.
(Signed)
23rd April, 1925.
J. M. KENNEDY.
CHARLES H. MERZ.
S. L. PEARCE.
APPENDIX
THE
EFFECT
OF
INTERCONNECTION
GENERATION
OF
3.
ON
REDUCING
ELECTRICAL
THE
COST
OF
ENERGY.
I n p a r a g r a p h 2 4 of our R e p o r t w e h a v e referred to t h e e c o n o m i e s u n d e r t h r e e h e a d s
w h i c h m a y be e x p e c t e d t o f o l l o w f r o m i n t e r c o n n e c t i o n .
T h e s e s a v i n g s are h e r e set o u t i n
greater detail
1. Savings in Capital Expenditure.—These
take place under the following heads
: ­
(a) I t i s p o s s i b l e t o d e s i g n g e n e r a t i n g p l a n t s w h i c h are c h e a p e r p e r k i l o w a t t i n s t a l l e d
d u e to t h e u s e of larger u n i t s . L a r g e r u n i t s c a n be u s e d b e c a u s e t h e l i m i t a t i o n
to t h e s i z e of t h e i n d i v i d u a l u n i t b e c o m e s l e s s t h e larger t h e s y s t e m of w h i c h it
f o r m s a part.
(b) T h e p e r c e n t a g e of useful o u t p u t o b t a i n e d f r o m t h e p l a n t i s i n c r e a s e d b e " a u s e h
i s n o t n e c e s s a r y to provide s u c h a l a r g e p e r c e n t a g e of p l a n t as r e s e r v e a g a i n s t
breakdown, since the interconnected stations are, to some e x t e n t , e m e r g e n c y
s t a n d b y s t o e a c h other.
(c) T h e capital e x p e n d i t u r e o n p l a n t is, a l m o s t d i r e c t l y p r o p o r t i o n a l t o t h e m a x i m u m
d e m a n d w h i c h h a s to be m e t .
T h i s m a x i m u m d e m a n d occurs at s o m e w h a t
different t i m e s i n different d i s t r i c t s .
If all s u c h d i s t r i c t s d r a w t h e i r e n e r g y f r o m
a c o m m o n s y s t e m t h e a m o u n t of plant to s u p p l y t h e c o m b i n e d l o a d s i s r e d u c e d .
(d) E x t e n s i o n s of p l a n t h a v e t o be m a d e i n a d v a n c e of t h e d e m a n d a n d t h e i n t e r e s t o n
s u c h p l a n t d u r i n g t h e period t h a t i t i s n o t profit e a r n i n g i s a n a p p r e c i a b l e i t e m .
If t h e v a r i o u s areas w e r e i n t e r c o n n e c t e d t h i s w o u l d b e r e d u c e d for t h r e e r e a s o n s :
(1) T h e a n n u a l i n c r e a s e of d e m a n d is m u l t i p l i e d at a. g r e a t e r r a t e t h a n t h e
s i z e of t h e i n d i v i d u a l u n i t s of p l a n t , so t h a t t h e a m o u n t of non-profit
earning plant in the whole country is reduced.
(2) A l l e x t e n s i o n s of p l a n t m u s t b e m a d e o n estimates of d e m a n d , w h i c h m u s t
i n c l u d e a m a r g i n for c o n t i n g e n c i e s .
If all t h e s e m a r g i n s are p o o l e d a
s m a l l e r m a r g i n i s sufficient.
­
(3) T r a d e f l u c t u a t i o n s i n different d i s t r i c t s are n o t c o i n c i d e n t a n d i d l e p l a n t
i n a district w h e r e t r a d e i s poor m a y b e u s e d t o s u p p l e m e n t p l a n t i n a
district w h e r e t h e d e m a n d i s u n e x p e c t e d l y h i g h .
(e) T h e e r e c t i o n of s m a l l s t a t i o n s , w i t h t h e i r h i g h c o s t s p e r k i l o w a t t i n s t a l l e d , c a n be
avoided by the undertaker t a k i n g supply in bulk from the transmission network.
T h i s i m p r o v e s t h e load o n t h e larger s t a t i o n s a n d t h e r e f o r e still f u r t h e r i n c r e a s e s
their efficiency.
2.
Savings in Operating Costs.—These d i v i d e
into the following heads :—
(a) T h e s i t e of n e w s t a t i o n s can b e c h o s e n w i t h o u t a n y r e g a r d for local b o u n d a r i e s so
as t o o b t a i n p l e n t i f u l w a t e r a n d c h e a p coal.
(b) T h e larger u n i t s of p l a n t are m o r e efficient i n coal c o n s u m p t i o n a n d t h e labour c o s t s
of o p e r a t i n g do not i n c r e a s e at t h e s a m e r a t e as t h e s i z e of unit'.
(c) D u e to p l a n t h a v i n g to be p r o v i d e d to deal w i t h t h e m a x i m u m d e m a n d a p r o p o r t i o n
of g e n e r a t i n g p l a n t i s o n l y r e q u i r e d for a f e w h o u r s p e r w e e k .
I t is therefore
d e s i r a b l e t h a t t h e p l a n t w h i c h is idle s h o u l d b e t h e l e a s t efficient p l a n t .
By
i n t e r c o n n e c t i o n it is possible so to a r r a n g e t h a t t h e m o s t efficient p l a n t r u n s for
t h e l o n g e s t period
(d) N o t o n l y is t h e inefficient s m a l l s t a t i o n e l i m i n a t e d t h r o u g h p u r c h a s i n g i n b u l k , b u t
t h e transfer of t h e load to t h e larger s t a t i o n s w o u l d still f u r t h e r i m p r o v e t h e
e m c i e n c j ' of t h e latter.
(e) T h e a p p r e c i a b l e w a s t e h e a t a n d w a t e r p o w e r r e s o u r c e s of t h e c o u n t r y are r e n d e r e d
a v a i l a b l e , a s t h e y c a n be fed i n t o t h e c o m m o n n e t w o r k .
3. Those due to Load picked up by the Interconnecting Mains.—Increased load i n c r e a s e s
e c o n o m y b o t h b y e n a b l i n g p r o d u c t i o n to t a k e place o n a larger s c a l e and also b y i m p r o v i n g t h e
load factor of t h e g e n e r a t i n g p l a n t . T h e rural load w h i c h w o u l d be p i c k e d u p b y t h e i n t e r ­
c o n n e c t i n g t r a n s m i s s i o n m a i n s w o u l d be of a different t y p e f r o m t h e u r b a n l o a d s , and should
therefore b e specially u s e f u l i n i m p r o v i n g load factor.
Quite apart from t h e t e c h n i c a l a d v a n t a g e of t h i s load, t h e social b e n e f i t s of e l e c t r i c a l l y
d e v e l o p i n g rural areas and of p r o m o t i n g d e - c e n t r a l i s a t i o n of i n d u s t r y are of n a t i o n a l
importance.
APPENDIX
CONSTITUTION,
POWERS
4.
A N D D U T I E S OP
BOARD.
THE
CENTRAL
ELECTRICITY
(I) T h e B o a r d t o b e c o m p o s e d as f o l l o w s : —
(a) T o b e n o m i n a t e d b y t h e M i n i s t e r of T r a n s p o r t after c o n s u l t a t i o n w i t h t h e E l e c ­
t r i c i t y C o m m i s s i o n e r s a n d s u c h o t h e r b o d i e s as h e m a y t h i n k fit—
A Chairman.
T w o m e m b e r s e x p e r i e n c e d i n M u n i c i p a l or L o c a l G o v e r n m e n t affairs.
T w o m e m b e r s experienced in Electrical Company undertakings.
One m e m b e r with Railway experience.
(b) T o b e n o m i n a t e d b y t h e M i n i s t e r of T r a n s p o r t after c o n s u l t a t i o n w i t h t h e Board
of T r a d e —
O n e m e m b e r r e p r e s e n t a t i v e of I n d u s t r y .
(c) T o b e n o m i n a t e d b y t h e M i n i s t e r of T r a n s p o r t after c o n s u l t a t i o n w i t h t h e
Treasury—
A Government nominee.
I n a d d i t i o n t o t h e a b o v e t h e r e w i l l b e a w h o l e t i m e M a n a g i n g D i r e c t o r , t o b e appointed
b y t h e B o a r d w i t h t h e approval of t h e M i n i s t e r , w h o w i l l also b e V i c e - C h a i r m a n and will
r e q u i r e t o b e p a i d a s u b s t a n t i a l salary.
T h e Chairman and other m e m b e r s to receive fees and expenses only.
(2) T h e B o a r d t o p r o v i d e or s e c u r e t h e p r o v i s i o n of a c o m p r e h e n s i v e s c h e m e of generation
of e l e c t r i c i t y a n d i t s t r a n s m i s s i o n a n d d e l i v e r y t o a n y u n d e r t a k e r s r e q u i r i n g a s u p p l y at a price
w h i c h s h a l l c o v e r all e x p e n d i t u r e o n i n c o m e a c c o u n t ( i n c l u d i n g i n t e r e s t a n d s i n k i n g fund
charges)
(3) T o a p p o i n t a n E n g i n e e r - i n - C h i e f , S e c r e t a r y a n d s u c h officers a n d s e r v a n t s as the
Board m a y determine.
(4) T o b e a u t h o r i s e d t o c r e a t e s t o c k , a n d b o r r o w m o n e y s u b j e c t t o r e g u l a t i o n s to b e made
b y t h e M i n i s t e r of T r a n s p o r t w i t h t h e a p p r o v a l of t h e T r e a s u r y , u p t o a p r e s e n t limit of
£25,000,000.
(Note.—They
s h o u l d h a v e p o w e r , w i t h t h e c o n s e n t of t h e C o m m i s s i o n e r s , to
p o s t p o n e s i n k i n g f u n d u p t o a l i m i t of five y e a r s , a n d t o c a p i t a l i s e i n t e r e s t w h i l e the
expenditure r e m a i n s unremunerative up t o a similar period.)
(5) T h e m o n e y r a i s e d t o be a p p l i e d to t h e f o l l o w i n g p u r p o s e s : —
(a) T o e n a b l e t h e B o a r d t o c o n s t r u c t t r a n s m i s s i o n l i n e s , s u b - s t a t i o n s a n d o t h e r trans­
mission works;
(b) t o e n a b l e t h e B o a r d t o m a k e a n y o t h e r p a y m e n t or t o u n d e r t a k e a n y permanent
w o r k or o t h e r t h i n g w h i c h t h e B o a r d are a u t h o r i s e d t o e x e c u t e or d o ;
(c) t o p r o v i d e w o r k i n g capital.
(6) T o m a k e a g r e e m e n t s a s t o t h e w o r k i n g of s e l e c t e d s t a t i o n s a n d t o direct t h e general
o p e r a t i o n of s u c h s t a t i o n s for t h e s u p p l y of e l e c t r i c i t y b y t h e m t o t h e B o a r d .
(7) I n c o n n e c t i o n w i t h (6) t h e C o m m i s s i o n e r s o n t h e a p p l i c a t i o n of t h e B o a r d m a y require
b y Order a n y a u t h o r i s e d u n d e r t a k e r s t o g i v e r e a s o n a b l e f a c i l i t i e s :—­
(a) for t h e g e n e r a t i n g of e l e c t r i c a l e n e r g y f o r t h e p u r p o s e s of t h e B o a r d ;
(b) for c o n n e c t i n g t h e u n d e r t a k e r s ' s t a t i o n w i t h t h e t r a n s m i s s i o n s y s t e m of t h e Board.
(8) T h e C o m m i s s i o n e r s , o n t h e a p p l i c a t i o n of t h e B o a r d , m a y after a specified period
p r o h i b i t a n y a u t h o r i s e d u n d e r t a k e r s f r o m u s i n g g e n e r a t i n g p l a n t w h i c h i s i m e c o n o m i c a l if
t h e C o m m i s s i o n e r s a r e satisfied t h a t a s c h e a p a s u p p l y c a n b e afforded t h r o u g h t h e operation
of t h e B o a r d .
(9) T h e B o a r d t o b e a u t h o r i s e d t o p u r c h a s e e n e r g y derived f r o m w a t e r p o w e r , w a s t e heat
or o t h e r f o r m s of e n e r g y .
(10) T o h a v e p o w e r s t o break u p r o a d s , r a i l w a y s a n d t r a m w a y s a s m a y b e n e c e s s a r y for
t h e p u r p o s e s of t r a n s m i t t i n g e l e c t r i c a l e n e r g y for t h e p u r p o s e s of t h e B o a r d and p o w e r t o erect
overhead lines.
( I I ) T o h a v e p o w e r t o s u p p l y t o a u t h o r i s e d u n d e r t a k e r s w i t h c e r t a i n l i m i t a t i o n s , railways,
and c a n a l s , a n d t o a n y b o d y , c o m p a n y or p e r s o n i n a r e a s n o t c o v e r e d b y authorised under­
takers.
(12) T h e B o a r d a n d t h e C o m m i s s i o n e r s t o a c t j o i n t l y i n r e c o m m e n d i n g t h e Treasury to
a l l o w t h e o w n e r s of s e l e c t e d g e n e r a t i n g s t a t i o n s t o i s s u e c a p i t a l at c h e a p r a t e s .
(13) T h e B o a r d t o p r e p a r e a n A n n u a l R e p o r t of t h e i r p r o c e e d i n g s , t o w h i c h should be
a p p e n d e d t h e i r A n n u a l S t a t e m e n t of A c c o u n t s i n a f o r m t o b e p r e s c r i b e d b y t h e M i n i s t e r of
T r a n s p o r t . T h e R e p o r t t o b e p u b l i s h e d a n d p l a c e d o n s a l e at a s m a l l c h a r g e .
(14) T h e a c c o u n t s of t h e B o a r d t o b e a u d i t e d i n a c c o r d a n c e w i t h s u c h r e g u l a t i o n s as
m a y b e p r e s c r i b e d b y t h e M i n i s t e r of T r a n s p o r t a n d b y a n A u d i t o r t o b e a p p o i n t e d b y h i m .
(15) T h e B o a r d t o s u b m i t s t a t i s t i c s a n d r e t u r n s t o t h e C o m m i s s i o n e r s a s required by
them.
(16) T o h a v e p o w e r t o e s t a b l i s h a C o n s u l t a t i v e E n g i n e e r i n g "Committee f o r m e d from the
E n g i n e e r s a n d M a n a g e r s of t h e s e l e c t e d g e n e r a t i n g s t a t i o n s , w h i c h s h o u l d m e e t from time
t o t i m e t o d i s c u s s t h e c o n t i n u e d i m p r o v e m e n t s in t h e g e n e r a t i o n of e l e c t r i c i t y and t h e most
a d v a n t a g e o u s w a y of w o r k i n g t h e p l a n t at t h e i r c o l l e c t i v e d i s p o s a l .
CURVE SHOWING EFFECT OF LOAD FACTOR ON COST. BASED
UPON THE COSTS PER UNIT SENT OUT FROM A CAPITAL STATION
DESIGNED TO MEET A MAXIMUM DEMAND OF 100,000 K.W.
LOAD
LOAD FACTO
FACTOR
R
2*0
2*0
30
40
50
60
70
60
20
PER
CENT
3 0
4 0
SO.
6 0
ANNUAL LOAD FACTOR.
COST
COST OF COAL
COAL
0-3269
0-2477
0-247
7
01982
01585
01387
01238
01090
70
80
Malby Sc Sons, Llth.
APPENDIX
5.
N O T E TO E X P L A I N T H E M E A N I N G OP " L O A D P A C T O E " A N D I T S
U P O N T H E COST OP E L E C T E I C A L
BEAEING-
ENEEG-Y.
DEFINITIONS.
A K i l o w a t t i s e q u i v a l e n t t o 1J- h . p .
j
A K i l o w a t t h o u r i s a s y n o n y m for a unit, of e l e c t r i c i t y
A year contains 8,760 hours.
T h u s a K i l o w a t t of g e n e r a t i n g p l a n t w o r k i n g c o n t i n u o u s l y t h r o u g h o u t t h e y e a r w o u l d
produce 8 , 7 6 0 u n i t s .
If, as i s m o r e g e n e r a l , a K i l o w a t t o n l y p r o d u c e d 2 , 1 9 0 u n i t s , t h e n t h e r a t i o of t h e s m a l l e r
n u m b e r of u n i t s a c t u a l l y p r o d u c e d , t o t h e l a r g e r n u m b e r w h i c h w o u l d h a v e b e e n g e n e r a t e d
had t h e K i l o w a t t of p l a n t w o r k e d c o n t i n u o u s l y t h r o u g h o u t t h e y e a r , r e p r e s e n t s t h e L o a d
Factor.
I n the above e x a m p l e t h e ratio is :—
2190
8760
1
4"
­
25
100
and t h u s t h e r e s u l t i s g e n e r a l l y expressed, a s a n " A n n u a l L o a d F a c t o r of 25 per c e n t . "
T h e c o s t s of g e n e r a t i n g e l e c t r i c i t y a r e d i v i d e d i n t o t w o p a r t s : —
(a) F i x e d c h a r g e s ( s u c h a s i n t e r e s t o n c a p i t a l , d e p r e c i a t i o n or s i n k i n g f u n d for r e p a y ­
m e n t of c a p i t a l , m a n a g e m e n t , w a g e s , e t c . ) w h i c h d o n o t v a r y w i t h t h e a c t u a l
units generated by any given plant.
(b) E u n n i n g c o s t s — m a i n l y coal a n d s t o r e s — w h i c h v a r y a l m o s t p r o p o r t i o n a t e l y to t h e
units generated by any g i v e n plant.
T h u s i t i s t h a t i n t h e a t t a c h e d c u r v e t h e i n f l u e n c e of t h e -fixed c h a r g e s n e c e s s a r i l y r a i s e s
the cost per unit at low-load factors, b e c a u s e t h e divisor (or t h e n u m b e r of units) is l e s s :
t h e cost- p r o g r e s s i v e l y d e c l i n e s a s t h e load f a c t o r i n c r e a s e s i n v a l u e .
I n t h e c u r v e t h e c o s t i s a s h i g h as 0'7'd. per u n i t at a 2 0 per c e n t , load f a c t o r ,
a u t o m a t i c a l l y r e d u c e s to 0'2d. o n l y at t h e h i g h - l o a d f a c t o r of 8 0 per c e n t .
(SS641-1J)
Wt 1854-786.
150 5/25
H. St.
G. 6
and