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URGES DIRECT (Continued from page 5) APPEAL ON HYDRO sense of the word id it aw arbitrary act, To understand the present situa- tion it is necessary to know a little of the back-ground or history. 'Previous to the year 1916 the whole generation, transmission and ( dlstribution of electric power in this ust et was in the control of a com- the Seymour Power and Elec- oo Company or the Central Ontario Power Company, which in turn were owned or controlled by Sun Life Insurance Company of Montreal. At that time Sir Adam Beck, as chair- man of the Hydro-Eleetric Power Commission, was making every ef- fort to extend the Hydro Electric system and control throughout the Province, The Central Ontario system was valued by his engineers with a view to purchase mo doubt and they fixed a value of $5,672, 000,00. For some reason which has not been at all clearly or satisfac- torily explained by any person yet, the entire system was finally pur- chased at the price of §8,350,000,00, which was $2,677,000, 00 in excess of the valuation placed upon the Hydro Electric. Power Commission by its own engineers. "At a conference with the present Hydro-Electric Power Commission since the recent raise in rates, It was explained that this discrepancy represented the amount paid for water rights, franchise and other intangible assets, Doubtful Point "It may well be doubted whether the present users of power in this district are prepared to accept this explanation, It must be horne in mind also, that this excessive amount of over $2,600,000,00 has borne in- terest since the purchase in 1916 amounting to approximately $170,- 000,00 a year, Furthermore, when the Ontario Government purchased the system they acquired not only the electric systems proper but they also 'acquired street railways, pulp mills, timber limits, gas works, and all the other assets that helonged to the old Company, many of which have been operated at a loss, It is apparent from an examinatjon of the reports of the Hydro-Electric Power Commission since 1016 that the electrical assets proper have ands of dollars, increase in rates, pired on the 1st of March, A.D. system. be economical, excepting in ferent direction. erment Relief : "As I have already said, this system was purchased by and has been operated for the Provincial Government. It does seem to me that the Provincial Government should assume all or a substantial part of the burdens that have been placed upon the system through the unwise and improvident purchase of the system and its subsequen; adminis- tration. There would be consider- able justice and likelihood of resaits in going to the Provincial Govern- and asking them to absorb at ery least the excessive price aid for the system amount- who can bring us any relief from the present situation, and on the merits of the case, one would think that the Proyincial Government could net turn a deaf ear if the sit- uation were properly and fully pre- sented to them." vol " been profitable or successfully oper- ated whereas the other assets of a non-electrical nature have been a burden on the system and have created deficits running into thons- "It must he borne in mind that in reality the ' Central Ontario System was purchased by the On- tario Government and simply hand- ed over to the Hydro-Electric Power Commission of Ontario to administer as trustees, Our system has never heen part of the Hydro-Electric System, proper, although, of course, it has been under the same manage- ment and control as the system in Western Ontario, It should also he borne in mind that the Hydro-Eleg: tric Power Commission of Ontario as at present constituted is proo- ably not responsible for the recent Re-Financing #When the system was purchased by the Government, the purchase price of $8,350,000.00 was paid by ten year Provincial bonds which ex- 1927. The refinancing of this indebt- edness, together with capital expen- ditures and losses on the system capitalised, pow amounting in all to some $14,000,000.00, has created the present situation, Specifically, it might very properly be said that the first mistake arose in the pur- chase of the system at an excessive price of over $2,000,000,00, then the carrying of unprofitable assets in- curring losses which are now capi- talised was the next error, Added to this there is the fact that during its ten years of administration the Hydro-Electric Power Commission entered into some improvident con- tracts notably with the City of King- ston and with the Canada Cement Company of Point Anne whereby for a period of years it contracted to sell power at a price much lower than is now being charged to other municipalities and industries, in the "It is most commendable for any person to endeavor to devise some form of relief and it is interesting to note that a scheme to operate a Central plant for system of our own electricity by steam has been pro- pounded. The fact, however, that such plants have mot been found to where steam coal cap be purchased at a very low price, would seem to indicate that such proposal would be most difficult to work out. In my bumble opinion, relief from the pres- ent situation lies in an entirely dif- si tt PERF Ol ART 3 Minutes Walk From Gerigral Mators IS READY! 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