ELECTRICITY IN THE NORTH OF SCOTLAND: A REJOINDER
| Author | D. L. Munby |
| DOI | http://doi.org/10.1111/j.1467-9485.1957.tb00215.x |
| Date | 01 February 1957 |
| Published date | 01 February 1957 |
ELECTRICITY IN
THE
NORTH OF SCOTLAND:
A REJOINDER
I
AM
grateful for the care which MacDonald and Kay
(MK
for short)
have taken in reply to my article. But
I
am not sure that they have
got to the heart of the matter.
1.
My main point was whether it was economic to build further
hydro-electric dams, except for peak-load supply. What prices are
charged to consumers is a quite secondary matter
;
it is not obvious
to an economist that the criteria to be used for deciding on produc-
tion policy should form the basis
of
pricing policy. Whether money
has been wasted in the past in building dams or not is also secondary
;
I
did not raise this question. Nor is it a major matter whether
Parliament or the Board are responsible for waste, if waste occurs.
A good deal of MKs reply is thus not concerned with the main issue.
2.
The nub of my argument was in Table VII (p.
35).
Load
factors are not ignored. MKs Figures and Tables for hydro costs
coincide with mine for capital costs
of
€70
per
1,000
units per annum.
There is no disagreement about the conclusions to be drawn, if the
Board can keep capital costs down to this figure.
3.
The crux of MKs reply is the
ex cathedra
assertion that the
Board’s schemes under construction ‘will cost at present prices
.
.
.
€68
per
1,000
kilowatt-hours per annum which compares with an
average of
€61
for all the hydro schemes put into service since the
war
’.
More space could have been given to explaining these figures.
The Board had previously published only the figures given on
my
pages 25-6, which refer to estimated costs at various dates. The first
published figures of
completed
costs were given by Mr.
T.
Johnston
in October
1956,
when he said that the final cost of the Garry scheme,
as completed in
1956,
was
f61
per
1,000
units per annum. In March
1948
the estimated costs were
€29,
and work started in
1951
;
in
terms of
1954-55
prices, it seems reasonable to assume that this means
something over
E70.
What we need are detailed figures of the capital
costs of particular schemes, present and future, in terms
of
stable
pounds. Are we to believe that the Board did not start to develop
the cheapest sites, and that it is not the case that later sites are likely
to be more costly than earlier ones?
4.
It is not at all clear how the Tables and Figures have been built
up. They are described as
‘
the cost
of
all post-war schemes
’,
and
‘the mean curve drawn within the band
of
costs at a number
of
hydro-stations
’
;
the curve looks remarkably like a median curve
27
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