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Demand Intervals Used by Various Companies

In order to ascertain the present practice and apparent tendency in this matter, information was secured from the companies operating in the larger cities and which is given in Table II:

and power

TABLE II
Width of Peak Used in Different Cities in Determining
Maximum Demand Charge

General Light Railway

power Buffalo, New York...

2 Min. *Spokane, Washington.

5 Min. New York, New York.

.5 to 10 Min. Cleveland, Ohio...

15 Los Angeles, California..

15 Milwaukee, Wisconsin.

15

15 Min. *Minneapolis, Minnesota.

15 *Rochester, New York.

15 St. Louis, Missouri.

15

30 Min. *Boston, Massachusetts.

30

60 * Brooklyn, New York.

30 *Chicago, Illinois...

30

60 Min. Kansas City, Missouri.

30

60 Detroit, Michigan.

60

60 Philadelphia, Pennsylvania.

60

66

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The member companies in cities marked thus * use Wright demand indicators for part or all of their D. C. consumers, but not for A. C. consumers. Those marked thus

in one or the other column use either non-instrumental methods for determining the maximum demand; sell on a straight kilowatt hour basis; or else sell no power for railway purposes of any kind.

In some cases a company has used different intervals at different times, but those given in Table II are those reported by them to the writer as being used in their latest contracts for power or wholesale light and power. Arguments in Favor of Thirty Minute Interval

Only two of the companies in the fifteen of the larger cities of the country given in Table II use an interval of less than 15 minutes for general light and power; 6 companies use 15 minutes; 4 use 30 minutes and 1 uses 60 minutes. The writer believes that for the sale of general light power an interval of 5 minutes or less is unwise; also that a 30-minute interval is slightly better than a 15-minute interval and summarizes his reasons as follows:

1. Short interval readings either introduce greater percentage of error in the maximum demand or added complications and difficulty in metering.

2. Short interval readings are not necessary on a large consumer, because his load is usually made up of large number of units and therefore load is more uniform, or to express it differently, the ratio of 5 minutes to 12 hour maxima is small.

3. The existence of a very high or large diversity factor between the small consumers and also between the consumers who use their power intermittently reduces the necessity for a short interval maximum for these small or medium sized consumers.

4. The use of short and frequent intervals requires much more work.to figure and is no inconsiderable item when it is considered that there is usually a subtraction of readings in one form or another and multiplication by a constant.

5. The practicability of off-setting the slight apparent concession of using a longer interval of average of more than one maximum by a slightly higher primary rate of charge per kw eliminates the necessity for use of short intervals.

6. The use of a long interval, say 30 minutes, as against 5 minutes, makes only a very slight difference in income, which may easily be allowed for in rate-making, and promotes much better relations with the consumer who can never understand why he should be penalized for an occasional or accidental demand which lasts only a few moments.

Conclusion

The writer desires that in advocating the use of a maximum of moderate length with a compensated primary charge his position should not be construed as relinquishing the advantage to the supply company of the diversity factor of its various consumers, but rather the opposite, as stated in a former paper, in which he has said:

“The diversity factor is the very foundation rock of centralized energy supply. It is the birthright of the Central Station, the fundamental basis of its existence and its resultant value belongs to the Central Station Company."

Reasonable Profit

Its Definition, Collection

and Distribution

by

JAMES V. OXTOBY

Presented before
Association of Edison Illuminating Companies

September, 1910
And Revised to October 31st, 1910

(Reprinted from Legal Phases of Central Station Rate Making

for Electric Supply, Printed by Association of

Edison Illuminating Companies, 1911)

INDEX

Paragraphs

1-4

Introduction....
Definition of Reasonable Profit...
Collection of Profit from Classes of Customers.
Distribution of Profit Between Stocks and Bonds
Conclusions...

5-39 40–70 71-90

91

*

INDEX TO APPENDIX

Page

161

Memorandum of Authorities on Reasonable Profit...
Memorandum of Decisions of Railroad Commission of Wis-

consin...
Extract from Wilcox vs. Consolidated Gas Company, 212

178

U. S. 19....

179

182 184

194

208

Extracts from Recent Decisions of Railroad Commission of

Wisconsin, on Reasonable Profit:
(1). Case of Menominee & Marinette Light and Trac-

tion Company (August, 1909).
(2) Case of Antigo Water Company (August, 1909)
(3) Case of Madison Gas and Electric Company

(March, 1910)..
Decision of Massachusetts Gas and Electric Light Commis-

sion in matter of gas rates of Charlestown Gas and Elec

tric Company Rule of New York Public Service Commission, Second Dis

trict, as to apportionment of capitalization between

bonds and stock Extract from decision of Massachusetts Gas and Electric

Light Commission in matter of rates of Edison Elec

tric Illuminating Company of Boston. Extract from address of Senator Joseph W. Bailey, on “The

Power to Regulate Transportation Charges by Statutory

Enactment”.
Extracts from Testimony of Mr. E. P. Ripley before Inter-

state Commerce Commission...
Summary of Testimony of Mr. Jas. McCrea before Inter-

state Commerce Commission..

210

211

216

221

225

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