choose; that is simply a matter for each individual city.

MR. ROBERTSON: Do you take into account the maximum demand coming at at one time in one case and at another time in another case?

THE PRESIDENT: You will find that the average maxima of your customers is about one-third higher than the maximum of your station.

MR. FERGUSON: The sum of the customers' maxima is one and one-fourth times the absolute maximum of the station. I neglected those cases that Mr. Robertson asks about, because they are not worth bothering about. I brought that question up with Mr. Wright at the convention last year at Niagara Falls, and showed him that if a man used his service from four o'clock until twelve he ought to have a lower rate; but the number of customers in this class is so small that it does not affect the system. You must not discredit the system because you have some few customers that want to be treated on a special basis.

MR. ROBERTSON: It is in the company's favor to disregard it.

MR. WEEKS: There have been few discussions before this association, Mr. President, of greater importance to central-station interests than that to which we have just listened. In the cost of our product, the relative value of the interest factor has been forcibly and clearly shown, and the necessity for revision of rates or discounts has been ably demonstrated. In my judgment, the method employed by Mr. Insull, or a slight modification of it, will soon come into general use. In one respect, however, the practice as stated strikes me of questionable equity, if not expediency, and I should like to ask Mr. Insull what

has been the effect upon your revenue of the lower rates for summer service?

MR. INSULL: We do not know yet; we have only put them in operation during the last few months.

MR. WEEKS: It seems to me that it is somewhat inequitable to make a lower rate for transient summer service, such as that of the customer that operates a fan but a few weeks or months, at most, in the year, while his rate on account of the interest factor should be higher, rather than lower, than that for most other classes of service.

MR. INSULL: That is a discrepancy, but we have a large by-product that we want to sell, which usually lies idle in the summer; and we endeavor to dispose of if to these casual users.

MR. WEEKS: What would be the effect of this system or the Wright system upon the present rates for municipal lighting? What would be the rate on municipal lighting?

MR. INSULL: It would be very low.

MR. WEEKS: Have you determined that?

MR. FERGUSON: The municipal light runs about twelve hours It depends upon whether it is a moonlight schedule or an all-night service. It would not get so low as you are selling it now. You can readily see that if you make the rate twenty cents for the first hour and ten cents for everything after that, the maximum discount will not reach fifty per cent. It is something higher than that now. It is the same as if you figure ten cents per kilowatt-hour. You will have to make the second rate low enough to figure out the same kilowatt-hour that you are now charging for the arc-light service. That must be arranged in each individual city.

THE PRESIDENT: We should be pleased to hear

from Mr. Rice, if he has anything further to say on the subject.

MR. RICE: There is one point of which I wish to speak. These curves of costs of plants show the figures during the last four years of the "record " plants of England. These curves show plants having outputs of between 500,000 and 4,000,000 units.

It

is interesting to observe that the largest plant shown, the Westminster plant, is only about one-quarter as large as that of the Edison company of Chicago. The cost was eight cents per kilowatt-hour in 1890; in 1897 it had dropped to a little over four cents. The sinaller plants have, perhaps, one-hundred-kilowatt

capacity. Their costs in 1890 were about nine cents a kilowatt-hour and in 1896 four cents; the Portsmouth plant, having a maximum output of 800,000 units only, is down to three and one-half cents, whereas the record of the largest plant in England is four and one-fourth cents per kilowatt-hour.

MR. FERGUSON: This method should be carried

further, and is to be carried further. You can readily appreciate that fifty per cent discount, or ten cents per thousand watt-hours, is not low enough to get all the business. To take out isolated plants, you will have to sell current at five cents an hour, and perhaps as low as four cents. To take care of

the large business, it will be necessary to give a quantity discount beyond the discount that you give by the combination of the high and low rate. But that wholesale discount should be based only on that portion of the current that is sold at the low rate; you should not discount the high-rate portion, but only the low-rate portion. The high-rate portion is intended to cover the interest charges, and if you had a customer that had 10,000 lamps and was billed $2,000 under the Wright demand system he would be entitled to ten per cent or fifteen per cent discount; whereas if you gave him discount for quantity, it would be forty per cent, which would be unfair to the small customer. The intention is to give the low rate to the long-hour burner.

On motion, the meeting adjourned until three o'clock.