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- | PAGE SIX THE OSHAWA DAILY TIMES, FRIDAY, DECEMBER 2, 1927 More Hydro Power For Eastern '(Continued from page 3) Ontario--with regard to our hydro rate problem." F. L. Mason . The objectives of the deputation were stated to Premier Ferguson by President Mason. He reviewed the history of the Central Ontario Power Association; explaining that in its efforts to obtain relief for high hydro rates, they had exhausted every av- enue of inquiry possible before bring- ing theirstroubles to the head of the Ontario Government. However, having decided upon that course, they came with the approval of the Hydro-Electric Power Cota- mission of Ontario. The deputation was waiting upon the Government not as people with a grievance, but students of a problem who had ar- rived at what seemed the only pos- sible solution. Sccty. J. O. Herity presented the formal report of the Central Ontario Power Association's general meeting at Cobourg on Nov. 4, after which the following civie officials were call- ed upon to address the premier: Mayor Holloway of Peterborough, Mayor Holdgate of Bowmanville, Mavor Preston of Oshawa, Mayor McGuire of Cobourg, City Treasurer HH. B. Stock of Belleville, and ex- Mayor G. D. Conant of Oshawa. Mr. Conant's address threw a new er Heals Eczema . In 7 Day | or Less Or Your Money Back gurgeon's wonderful prescription now dispensed by pharmacists at trifling cost, that will do more towards helping you got rid of unsightly spots and skin »nses than anything you've ever Here is a Not only does this great heal- ing antiseptic oil promote rapid and healthy healing in open sores and wounds, but boils, abcesses and ulcers that are discharging are almost immediately relieved and cleanly healed. 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Promised light on what was considered the darkest corner of the problem which involves asking the Government to recommend a subsidy for Eastern Ontario which would be taken from the treasury of the Province as a whole, He pointed out that while Western Ontario's Niagara Power develop: ment had been an inter-municipal en- terprise, financed and supported by that progressive section of the Pro- vince, vet the guaranteeing of their hydro-electric development bonds had been on the good faith and credit of the Province as a whole, Important Point This fact, he pointed out, had un- doubtedly meant a saving of millions to the Western Ontario municipali- ties in the matter of interest charges alone, Therefore, Eastern Ontario-- without shame and with no other plea than that of equity--ieit that it could ask the Government to sanction the writing off of excess capitalization of the central region power system which had been purchased without consulting the people concerned di- rectly, and at a price over $2,000,000 in excess of the system's declared re- placement value as shown on the books of the Hydro Electric Power Commission, Mayor Preston, in addressing the premier, made two general but tell- ing points. He gave Hon, Mr. Fer- guson a statement of hydro power rate increase in Oshawa this ycar as compared with 1926 in terms of percentage; and then pointed out that industrial development is seri- ously held up because factory owners who consider locating in Central On- tario are invariably confronted with power costs that will not stand com- parison with rates in force in West- ern Ontario, Mayor Holgate of Bowmanville stressed the effect of rate increase on Bowmanville's leading industries. The Goodyear Rubber Company's rates had been increased 20 per cent; the Dominion Organ Company was forced to pay 40 per cent mere for its power. These were matters of serious concern to Bowmanville where, under such conditions, it was not only deprived of hoping for new industries, but was under threat of losing what it already had. City Treasurer Stock of Belleville presented a masterly summary of the rate question as affecting that city. There, too, the vital question was industry. Belleville, it was stated, is not further from the source of power than is St, Catharines in the Niagara district, Yet St. Catharines gets hydro at $15.74 the horse power while Belleville has to pay half as much again, The city's hydro charge for 1926 was $8,903, cove g street lighting and other hydro uses, but this year it will be $11,000 and more. Mayor McGuire of Cobourg. de- clared his city had never in any vious year had so many inquiri from prospective new industries, but negotiations had invariably broken A down on the point of power rates, Mayor Holloway of Peterborough stressed the need of Govérnment re- Kiet Jor pi ve Ritalization as the fair solution he : 10 gether with the sale bi non-profitable enterprises which had been saddled on'hydro in Central Ontario. "May I say how very glad I am to sce you here today," the Premier of Ontario bean his general state- ment when the deputation had been heard. "You gentlemen have given me some information that I did not have in mind before, and I must ack- nowledge that there are some fea- tures of this situation that I did not grasp before, "I know, however, that the Central Ontario system was taken over in response to the public' demand for Government operation of the system so that there would be no exploitation of power by private companies. "lI can say, as regards the price paid, that the company owning the system previously asked the full value of their bonds, that is some $9,300,000. After not a little nego- tiation, the system was purchased for $8,350,000 on the recommendation of the hydro commission and its chair- man. . "What really occurred was that we had to step into the shoes of a private corporation, and there were some problems that have arisen since which we did not anticipate. We could not, for instance, set aside con- tracts then in existence." This explained why some munici- palities and power users have: rates that figure out below the cost of hydro in this district, Some of these, how- ever, are being cleared up. Kingston, on the other hand, has obtained its special rates since the system was taken over by the Goy- ernment, However, despite the excess capi- talization, the premier has been given to understand that this district has saved some $3,000,000 in lower rates for hydro under Government owner- ship than would have heen demanded under private ownership. Many Gaing To that extent, Government own- ership has heen a success and in the best -interests' of Central Ontario, "Of course,". Hon, Mr, Ferguson continued, "there were unprofitable enterprises bound .up with the pur- chase of 'the system, We could not buy 'the hydro developmient without taking these also, The Commission has made a success of them in cer- tain cases--gas works, water works, and so on. At the same time, the Commission is committed to the po- licy of getting rid of non-profitable enterprises. "The system is also handicapped by the fact of excessive overhead, The Niagara system has but one over- head charge; the Central system has 10 or 12 overhead charges. "The Niagara system has also had to ahsorh losses. Certain construc- tion required during the war had to he scrapped. The loss there was some $3,000,000. "I am very glad that this organiza- tion has been created. It tends to make the people better acquainted with the system. "Development in Eastern Ontario, as compared with hydro growth in Western Ontario, has not been on the same foo The difference in cycles, as pointed out, had its effect. The large 'number of small power systems in Eastern Ontario had a de- finite bearing on the matter. "I may say that a new transmis- sion line is now under construction which will bring more power to Cen- tral Ontario, and megotiations for power to supply 'Eastern Ontario are well underway, We had hoped, in fact, that the contracts would have been signed before this . "Within a year, then, Eastern On- tario may expect to bencfit through another block of 400,000 additional horse power being made available. I am sure that the Hydro Commission will want to co-operate with your municipalities in the disposal of that power in a very generous measure." Develop District The premier then declared that the Government is prepared to endorse any movement towards the industrial development of Eastern Ontario and, infact, had a definite program in that regard under consideration, e summed up in conclusion: "You suggest that the ownership of the system be left in the Government's hands for the present at least; that the Government take the loss; and reduce the rates: This, gentlemen, would be a very desirable state of affairs. I don't know how far we may go. Having bought the plant, having taken the place of private operators and reduced the rates, the Government has alrcady gone a long way in the matter, "The recent increase in rates was made to take care of the replace- ment of the system at such time as it. may wear out or be superseded by improved methods of operation, "I will be glad to discuss this mat- ter with the Chairman of the Hydro Electric Power Commission who is away at present, and I will write to Mr Mason or, better Mr, Heriiy who is your secretary, advising what we may be able to do President Mason, at the conclusion of the premier's speech, expressed the Association's deep sence of gratitude for the interest: shown by the prime minister in the matter and for the cordial reception given hy him. The report from the Cobourg mecting of the Central Oniario Power Association, as presented hy Mr. Herity and sioncd by P lent Mason as well, follows: "To the Honourable Ferguson, prime Minist and Mcmbers of His C "Following the drastic increase i power and lighting rates ov entire Cent: 0: io p tem which wos put into « Hydro-Electric Power on. January 1st, 1927 Ontario Power Asse ganized on February 17th, 122 rising' representatives of the cipalities receiving electrical from the Central Onta-io Syst "In the opinion of the coay which formed the croanization ie increase did not £m warranted and as a consequer/~ a resolution was carried 'authoriz'ir* the executive to appear before the 17 dro Commission and make requc t th nm, ntion t the old rates should prevail until further informa- tion was obtained in regard to capi- tal investments, the distribution of costs, profits and losses, the status of non-electric utilities and other fea- tures of the system and its adminis- tration, "The executive appeared before the Commission on March 16, 1927, and met with a courteous reception and sympathetic hearing upon the part of the chairman, Hon. C. A. Me- grath, and the other members. "The Chairman promised to supply the Association with such data and information in regard to the Central Ontario System as it was possible to obtain and instructed Messrs. Clark- son, Gordon and Dilworth to prepare such statements as had been request- ed. "After the lapse of several months very complete detailed reports were furnished to the Association by the firm of auditors. Saw Commission "During the conference with the Commission, and later, aiter a care- ful examination had been made of the reports, it became evident that the adjustments of prices involved considerations with which the Com- mission was powerless to dcal. The only competent authority to deter- mine the questions at issue auprared to be the Ontario Government in whom ownership of the Central On- tario System was vested. "A subsequent general meeting of the members of the Central Ontario Power Association held at Cobourg Nov. 4, 1927, therefore decided to try to arrange an interview with Pre- mier Ferguson and his cabinet. "The matters which the meeting desired to lay before the Provincial Government were,-- *'A request for a reduction of power rates based upon a readjust- ment of the capital costs oi the Cen- tral Ontario System, * 'A recommendation that the Gov- ernment should continue, for the present at least, to retain its owner- ship of the Central Ontario S) as there were important nege i under way for the acquirements more power to serve the needs of eastern Ontario wihch might make it necessary to lia up and unif the five clectric systems of central and castern Ontario, "A rccommendation that where a icipality does not own the local system and fers t ownership vested in th Ontario Government as. at present that all surpluses, pa resent or future, properly assizncd to that municipality, be placed to its credit and not given over for the ge benefit of the system or of of municipalities owning local systems, **A recommendation that the oper- ation of non-clectric enterprises such as pulp mill s plants, and wat wo.l:s systems, not properly a | the work' that should be car by the Hydro-Electric P f mission, should be discon ( that all s pertics or utilities, a nistered by the Commis- part of the Central Onta § be disposed of at as early : ate and as advantageously as pos- sible. "'It was recognized at the time of purchase that the Government paid a price for this property that wa nr pr enormously in excess of its actual value, v alues ""The appraised value of the sys- tem was $387,319.00 and the replace- ment value as shown on the books of the Hydro Commission at the time of. purchase in 1916 was $5,055,942 As the sum of $7,632663.00 was paid for the Central Ontario System it is therefore apparent that the purchase price exceeded the replacement value by the sum of $2576,670.00. The amount of the replacement value was arrived at by the Engineers of the Commission after a long and careful investigation. If the interest charges for the period of ten years are added to this excess of over Two and a Half Millions a total of over Three and a Half Millions has been added to the capital cost of the System by the ex- cessive price Jad therefor. It is not felt by the Association or by the Power users in Municipalities inter- ested that this enormous difference or excess is adequately accounted for by any real values received therefor and not taken into consideration by the Commission's Engineers in valu- ing the system, " "While it is probably true that at the time of the purchase the Muni- cipalities interested were desirious that the system should be purchased and operated as a public utility, they had no knowledge of nor did they concur "in or consent to the pur- chasc of the system at the price that was paid for it, "'Another fruitful source of loss has been the non-electric utilities ac- quired with the Central Ontario Sys- tem. Without quoting instances or figures, it may fairly be observed that these outside properties or utilities have occasioned losses reaching an cnormous total, well up into the hundreds of thousands of dollars. While it may have been necessary, as a matter of bargaining, to take over these unprofitable adjuncts of the Electric Power Company, yet it does seem that they might have been discontinued just as well after the end of the first year as at the end of the tenth year. The power users all over the Central zone have had their bills greatly increased to make up the deficits on these unprofitable ven- tures that had nothing whatever to do with the development or distribu- tion of electricity, The continuance and multiplication of these losses can scarcely be made to appear justifiable charges against the Central Ontario System, "'The increased rates put into ef- fect January let, 1927, not only im- ose a heavy additional burden uron electric users in central Ontario but they place this division of the Pro- vince at a tremendous disadvantage hoth commercially and industrially when compared with the section served by Niagara Falls! "There are ample grounds for mak- ing a request for a readjustment of Capita! costs, The Government, by the purchase of the Central Ontario system, created a condition entirely Ufferent from that prevailing in the western part of the Province, The differences places all that zone lying cast of the County of York at a tre- mendous disadvantage in the matter of power costs, and it therefore ap- Ps (© S Fal, ie Be 2 J EB 4 ERE N 3 ZY IN A A DEINE WN El RR sandy AT: i? or Np, To TIO TR TR DANE AD a 2 Eo NY os DDN IRA 3 ARR RB TS BEN ey orn a BAW WW nee Ey Byer Ed ade SS EHR DE IERIE Em -------- AS i CES a i Ra LT TE ---- I __----_ Low rental. STORAGE SPACE FOR RENT About 12,000 ft, of good dry storage space, conveniently locatey ed, with Canadian National siding, for rent either in whole or in part. CHARLES M. MUNDY ¢/0 Mundy Printing Company, Limited Telephone 35 or 312 PWOOOOO0000O0C0000000000000CIOOCOOOOOOONTE pears to demand such treatment as will place the users of electricity in these two contiguous territories in a position somewhat approaching fair- ness and equality. "Precedents have been established and. are being created every day by which the larger community 'takes care of matters of this nature. The Welland Canal, for instance, is be- ing constructed as a general charge upon the tax-payers of Canada, al- though it carries little direct benefit to the people of the Maritime Pro- vinces or of British Columbia. "The deputation representing the Central Ontario Power Association and the Municipalities and power users of Central Ontario earnestly and respectfully request that read- justments of capital costs in the Cen- tral Ontario system be made so that power raaes in the district s by the Central Ontario Power tem may be reduced and placed a basis comparable with preva) rates in Western Ontario Oshawa's delegates, in additiol President Mason 1 Vice-Presi Conant of the Association, cons of Mayor R. D. Preston, W. E Sinclair, K.C, M.P.P,, Stuart St| Ald. Schell, Ald. MacDonald, J Fowids, and » Lngincer Smit Bowmanville was represented Mayor Holgate, John Lyle, Muni Clerk W, C. Caverly, and W. H. ruthers, Whitby was represented by Bateman and G. W. P. Every. R C. S. 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