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					                                 APPENDIX 1.1
                        (referred to in paragraph 1.7)
                               i
                            Interested third parties

British Steel Corporation
Chemical Industries Association
Electricity Consumers' Council
Electrical Contractors' Association
Glass Manufacturers' Federation
National Chamber of Trade
National Coal Board
National Federation of Clay Industries
Radio, Electrical and Television Retailers' Association (RETRA) Ltd
Yorkshire Electricity Consultative Council (YECC)




                                      174
                                       APPENDIX 2.1
                          (referred in paragraphs 2.21 and 2.26)


                   .YORKSHIRE       E L ECTR I                     OARD




HIAO OfflCt    •
At!A OfFICIS   O
WSKICI WHCIS   O
OTHtl TOWNS    •
                                                                                                                                                              APPENDIX 3.1
                                                                                                                                                     (referred to in paragraph 3.3)

                                                                                                                                                           THE ELECTRICITY COUNCIL


              1
             Dn Committee        Industrial                      Senior
                                                                       1                        Research C ommittee
                                                                                                                                      1
                                                                                                                            Performance Indicators        Financial a nd Pricing
                                                                                                                                                                                               1
                                                                                                                                                                                      Corporate Planning
                                 Relat ons                    Management                         1                                Committee                Policy Committee               Committee
                                 Committee          Conference (of Deputy Chairman)              '
                                                                                                  1
                                                                                         Electricity         Utilisation Research                       |                        1
                                 Medium Term                                          Supply Research                 Panel                       Load and Cost          Purchasing and
                                 Industrial                                               Council                                                 Research Panel        Contracts Matters
                                 Relations
                                 Plan Working               — Central Computer Committee                  __ Distribution                                         Retail Tariffs
                                 Party                        (has links directly with                       Research Panel                                          Pa nel
                                                              Chief Accountants' EDP
                                                              Committee and Chief Engineers'
                                                              Conference Resources and Computing
                                                              Consultancy Group)                            Study Group
                                                                                                          — on Distribution
                                                            — Manpower Committee                            Research Appraisal


                                                                                                                                                        Chief Officers' Functional Conferences
                                                                                                                                                        Reporting to EC Standing Committee or
                                                                                                                                                                  SMC as appropriate


                     1
          Chief Accountants'
                                              1
                                   Lawyers' Conference            Chief Engineers' Conference
                                                                                                                  1
                                                                                                    Public Relations Conference            Chief Commercial Officers' Conference
              Conference
                     1

— Current Cost Accounting Panel                               14 Chief Engineers' Consultancy Groups                                     — Joint Liaison Committee with Chief Accountants
                                                                                                                                         — Joint Liaison Committee with Chief Engineers
                     1                                        Planning Sector Group
                                                                                                                                         —~ Industrial Energy Marketing Group*
  Indices Reveiw Group                                        Corporate Planning
— Allocation Guide Working Party                              System Development                                                         — Working Party on Environmental Loads
                                                              System Utilisation
                                                              Research Liaison
                                                                                                                                                          9V            9          P
— Committee of London Clearing                                Operations and Safety Consultancy Group
  Bankers Negotiating Panel                                   Operations and Rel ability
                                                              System Automation and Protection
—Training of Accountants                                                                                                                 — Industrial Relations Liaison Group
                                                              Resources and Computing
  Working Group
                                                              Safety Liaison                                                             — Corporate Planning Group
— Chief Accountants' EDP Committee
                                                                                                                                         — General Purposes Group
                                                              Equipment Sector Group
                     1                                        Cables                                                              c   L
                                                                                                                                          - EB/AMDEA Committee
                                                              Overhead Lines                                                                            1
— ICL User Group                                              Switchgear
                                                                                                                                                 Working Groups
                                                              Transformers
                                                              Metering and Load Control                                       |                         |                           |
—Training Working Party                                       Communications and System Control                        Cooker Marketing           Space Heating             Spares and Service
— Computers & Privacy
                                                        — National Joint Utilitites Group
                                                                                                                            ^_^^^^^_
                                                                                                                           I                           I                      I                     I
                                                        — ESI/Manufacturers' Committee                             Strategy Working         Contracting Working       General Purposes       Service Working
                                                          for Standards Policy                                          Group                      Group              Working Group              Group

                                                    a   — EB/BEAMA Joint Commercial Committee

                                                  b c
                                                              Joint Sub-Committee o n Commercial Matters                       •                       I                  I                 I              1
                                                                                                                      General Purposes          Brown Goods           Small              Heating     Refriger,
                                                    d   — EB/OTLC Commercial Committee                                   Working                Working Party       Appliances           Working       Worki
                                                                                                                           Party                                     Working              Party          Part
                                                        1                                                                                                              Partv
                                                        — EB/BEAMA Joint Plant Technical Committee


                                                                                                                                               The Sector Group Chairmen also report directly
Source:   Electricity Council.                                                                                                                 to the Energy Marketing and Advertising Committee
:nergy Marketing and         Management Assessment.          Load Forecasting
                                                                                                 "1
                                                                                             National Joint                  National
 dvertising Committee           Development and                  Group                 Co-ordinating Council (GB)            Joint
                              Succession Committee                                                                           Negotiating
                                                                                                   I                         Machinery
                                                                                                                             NJNC
 Market Research                                                                       - ESITC                               NJM
      Panel                                                                            — HESAC                               NJB
                                                                                                                             NJC
                                                                                       — JCC (E&W) and JCC (S)               NJIC
                                                                                                                             NJ(B&CE)C
                                                                                       - JNC




   Education and Training                  Secretaries' Conference                                                  Regional Safety
    Officers' Conference                                                                                          Officers' Conference



       Working Party on                                     Estates and Way leaves Committee
       Audio Visual
                                                        — Insurance Officers' Conference
       Equipment

                                                        — Corporate Planning Working Party
                                    1
      .                             1
                        r                          1
                        I                          1                           1                                               1
          f EB/CEMA Joint Catering Air Conditioning Industry               Wayleaves        Home Office Radio            Development
                  Panel                     Board                          Payments           Stations Panel              Land Tax
                                                                            Reviews                                         Panel
                                                    1                        Panel
                EB/CEMA Joint           British Air Conditioning
               Technical Liaison            Approvals Board
                  Committee
                                                                     Abbreviations Key
         f Environments                 ~|
       — 1 Water Heating & Home Laundry 1 3 Sectors:                 a      BEAMA            British Electrical and Allied
         1 Cooking & Refrigeration       I                                                   Manufacturers' Association
                                                                     b      EB/ECMC          Electricity Boards/Electric Cable
                                                                                             Makers' Confederation
                                                                     c      EB/STCM          Electricity Boards/Super Tension
        1                                                                                    Cable Makers
  ing and Approvals                                                  d      EB/OTLC          Electricity Boards/Overhead Line
 •forking Group                                                                              Contractors
                                                                     e      EB/AMDEA         Electricity Boards/Association
                                                                                             of Manufacturers of Domestic
                                                                                             Electrical Appliances
        1                                  1                         f      EB/CEMA          Electricity Boards/Catering
     Vacuum              Home            Cooker                                              Equipment Manufacturers' Association
     Cleaner            Laundry          Working                     g      ESITC            Electricity Supply Industry Training
     Working            Working           Party                                              Committee
      Party              Party
                                                                     h      HESAC            Health and Safety Committee
                                                                     i      JCC              Joint Co-ordinating Committee
                                                                     j      JNC              Joint Negotiating Committee



                                                                     176
                                                                         APPENDIX 4.1
                                                                (referred to in paragraph 4.7)
                                                        Organisation of the YEB Head Office
                                                                               The Board

                                                              Chairman




                                                                 i
                                                           Deputy Chairman
                                                                                           Part Time Members




Chief Engineer                 Chief Commercial Officer                   Chief Accountant                     Secretary and Solicitor



 Deputy C.E                          Deputy C.C.O.*                           Deputy C.A.                        Deputy Secretary!


Assistant C.E's                     Assistant C.C.O's                        Assistant C.A's.                   Assistant Secretaries    Management Services
                                                                                                                                               Officer
Buildings                       Customer Operations                      Financial & Management                 Estates & Wayleaves
Construction                    Marketing                                   Accounting                          Legal
Operation                       Industrial Sales & Terms                 Customer Accounting                    Personnel
Technical                       Tariffs, Statistics &                    Centralised Accounting                 Purchasing & Stores
System Design                     Special Agreements                     Internal Audit
Transport (Senior                                                        Computer Services
  Exec. Officer)

* Also responsible for Domestic and Commercial Development Section and Commercial Administration,
t Also responsible for Administration and Education, Training & Advisory Sections.

Source: YEB.
                                                                         APPENDIX 4.2
                                                                (referred to in paragraph 4.24)
                                                     Organisation of a typical YEB Area
                     (Showing relationship with Head Office and the most recent type of District structure, eg Otley)
                                                                            Chairman


                                                                        Deputy Chairman


                                                                                                                  I                                 I
         Chief Engineer            Chief Commercial Officer                                              Chief A ccountant                Secretary & Solicitor




                                                                          Area Manager
                                                                                1
         Area Er igineer           Area Comme rcial Officer                                              Area A :countant                   Area Secretary



         System Design             Domestic anc Commercial                                                  Incorne                       Administration
         Construction                Developmt>nt                                                           Expe nditure                  Personnel
         Operation                 Customer Op
         Technical                 Industrial Development
                                                                                                                                                             \
         Transport                 Commercial /\dmin.
                                   Appliance Meirketing




        District EEngineer          District Industrial Staff                                     .   District Industrial Staff         District Industrial Staff
                                                                                                                                        Engineering Clerical Staff

            Engir eers
         Industri at Staff                                                   (Otley is an example of this type of District structure)


Source: YEB.
                                                              APPENDIX 4.2 (contd)
                                                      Organisation of a typical YEB Area
                            (Showing relationships with Head Office and the Doncaster type of District structure)
                                                                    Chairman

                                                                 Deputy Chairman

                                              I
          Chief E ngineer           Chief Commercial Officer                                     Chief Ac countant                  Secretary & Solicitor

                                                1
                                                1
                                                1
                                                                  Area b anager
                                              1
          Area Engineer             Area Commercial Officer                                      Area Accountant                       Area Secretary



                                    Domestic and Commercial                                                                          Administration
                                      Development                                                                                    Personnel
                                    Customer Operations                                                                              Purchasing & Stores
                                    Industrial Development
                                    Commercial Admin.
                                    Appliance Marketing




        District Engineer             Commercial Engineers                                                                         District Administrative
                                                                                                                                           Officer

            Engineers
                                                I
                                         Industrial Staff
                                                                                                                                               I
                                                                                                                                          Office Staff
         Industrial Staff                                             (Doncaster is an example of this type of District structure)      Industrial Staff

Source: YEB.
                                                                       APPENDIX 5.1 (a)
                                                               (referred to in paragraph 5.15)
                                 Yorkshire Electricity Board: historical cost accounts 1977-78 to 1981-82
     Revenue Account                                                                                                                                        £'000
                                                1977-78                  1978-79                 1979-80                  1980-81                 1981-82
     Sales of electricity                  454,863                 515,350                 571,958                  694,808                 798,687
     Rentals of apparatus and small
      repairs                                 686                     728                    2,268                    2,563                   2,620
     Miscellaneous                            398                     374                     506                      510                     576
                                                     455,947                  516,452                 574,732                  697,881                 801,883
     Deduct:
     Purchase of electricity               365,898                 415,031                 478,923                  564,551                 646,640
     Distribution             '             15,528                  18,989                  22,383                   26,108                  30,147
     Customer service                        4,906                   5,979                   9,049                   10,751                  12,068
     Meter reading, billing and
      collection of electricity accounts     6,351                   7,068                   8,125                   10,291                  11,459
     Administration and general
      expenses                               5,337                   6,168                   7,381                    8,872                   9,877
     Training and welfare                    1,890                   2,441                   3,465                    4,323                   4,499
     Rents, insurances etc                     828                    773                      974     •              1,172                   1,017
00   Rates                                   7,490                   8,160                   9,660                   12,346                  15,092
o    Proportion of Electricity Council's
      expenses                               1,250                   1,522                   1,806                    2,098                   2,206
     Changes of systems of supply                6                      —-                     —                        —                       —
     Historical cost depreciation           11,730                  12,135                  12,834                   13,436                  14,206
     Supplementary depreciation              4,882                   5,062                   5,344                    5,570                   5,861
                                                     426,096                  493,328                 559,944                  659,518                 753,072
     Operating profit/loss :
      Electricity supply                              29,851                   33,124                      14,788               38,363                  48,811
      Contracting and sales of
       appliances                                          1,035                   1,410                    2,670                   1,913                   1,546
                                                      30,886                   34,534                      17,458               40,276                  50,357
     Additional costs arising from early
      retirements prior to 1 April 1978                    —                   -1,183                       —                                               —
                                                                                                                                    —
                                                      30,886                   33,351                      17,458               40,276                  50,357
     Interest and financing expenses                  13,632                   12,026                      12,177               12,907                   8,918
     Profit/loss (—) transferred to Area
      reserve                                             17,254               21,325                       5,281               27,369                  41,439
       Source: YEB.
                                                                  APPENDIX 5.1(0)
                                                           (referred to in paragraph 5.15)
                          Yorkshire Electricity Board: historical cost accounts 1977-78 to 1981-82
As at 31 March                                                                                                                                                    £'000
Fixed assets                                  7975                       7979                       1980                       1981                       7952
Expenditure at 31 March             385,254                    399,299                    420,510                    444,671                    468,858
Less : Accumulated depreciation     197,677                    209,786                    226,122                    242,290                    260,778
                                                     187,577                    189,513                    194,388                    202,381                208,080
Current assets
Stocks and stores                     5,572                      6,658                      5,614                      5,679                      6,512
Contracting work-in-progress            498                        485                        561                        491                        364
Debtors :
 Electricity (consumption read
  in year) and other sales           52,335                     61,432                     50,836                     70,303                     80,176
 Electricity (estimated unread
  consumption)                       25,517                     32,670                     36,110                     40,804                     41,400
 Hire purchase and deferred
  payment instalments not yet due     7,645                      8,844                     10,613                     10,499                      9,431
 Miscellaneous                          642                      1,117                      2,743                      3,618                      2,997
                                     92,209                    111,206                    106,477                    131,394                    140,886
 Bank balance and cash               11,192                      9,637                      6,419                      9,768                     13,061
Less:                               103,401                    120,843                    112,896                    141,162                    153,941
Current liabilities
Central Electricity Generating
 Board :
  purchase of electricity            34,701                     41,089                     53,484                     62,924                     60,543
Creditors and accrued liabilities    12,669                     13,514                     15,947                     16,201                     16,537
Provisions                              129                        129                       —                          —                          —
                                     47,499                     54,732                     69,431                     79,125                     77,080
Net current assets                                    55,902                     66,111                     43,465                     62,037                     76,861
Net capital employed                                 243,479                    255,624                    237,853                    264,418                    284,941
Financed by :
Indebtedness to Electricity
  Council                                            159,682                    145,370                    116,928                    110,504                     83,683
 Area reserve                                         78,847                    100,172                    105,453                    132,822                    174,261
 Supplementary depreciation
  reserve                                              4,950                     10,082                     15,472                     21,092                     26,997
 Source:   YEB.                                      243,479                    255,624                    237,853                    264,418                    284,941
                                                                                 APPENDIX 5.1(c)
                                                                         (referred to in paragraph 5.15)

                                  Yorkshire Electricity Board: historical cost accounts 1977-78 to 1981-82
                                                     Contracting and sales of appliances
                                                                                                                                                                                                        £'000
                                                 1977-78                         1978-79                          1979-80                               1980-31                            1981-82
                                      Contract- Sales of              Contract- Sales of               Contract- Sales of                    Contract- Sales of                 Contract- Sales of
                                        ing     appliances    Total     ing     appliances    Total      ing     appliances    Total           ing     appliances    Total        ing     appliances   Total
Sales
Cash and credit                        5,558      5,663      11,221    6,481       7,739     14,220      5,349     10,210     15,559          15,512     10,121      15,633       6,112     1 1,226    17,338
Hire purchase and similar sales          332      5,551       5,883      365       6,652      7,017        483      8,050      8,533             457      7,077       7,534         261      6,333      6,594

                                       5,890     11,214      17,104     6,846     14,391     21,237      5,832     18,260     24,092           5,969     17,198     23,167        6,373     17,559     23,932

Direct cost of sales
Materials                              1,926      8,402      10,328     2,212     10,933     13,145      2,142     13,812     15,954     .     2,076     12,899      14,975       2,309     13,325     15,634
Salaries and related costs             1,651                  1,651     2,038                 2,038      1,741                 1,741           1,875                  1,875       2,073                 2,073

                                       3,577      8,402      11,979     4,250     10,933     15,183      3,883   . 13,812     17,695           3,951     12,899      16,850       4,382     13,325     17,707

Gross trading profit                   2,313      2,812       5,125     2,596      3,458      6,054      1,949      4,448     6,397            2,018      4,299       6,317       1,991      4,234      6,225
Hire purchase etc
  interest charges                        74       1,502      1,576       102      1,844      1,946        133      2,215      2,348             158      2,601       2,759 -       161      2,792      2,953

Gross profit                           2,387 '    4,314       6,701     2,698      5,302      8,000      2,082      6,663      8,745 _         2,J76      6,900     . 9,076       2,152      7,026      9,178

Indirect costs
Salaries and related costs                                    2,835                           3,247                            2,906                                  3,490 '                           3,760
Training and welfare                                            289                             372                              398                                    459                               503
Transport and delivery                                          748                             885                              915                                    975                             1,075
Work under guarantee and sundry
  expenses                                                      747                             920                              751                                   845                                863
Publicity and exhibitions                                       233                             241                              279                                   412                                394
Rents, rates and insurances                                     283                             308                              280                                   319                                333
Bad and doubtful debts                                           94                             147                              141                                   164                                161
Historical cost depreciation                                     97                              95                               66                                    74                                 75
Supplementary depreciation                                       68                              70                               46                                    50                                 44
Proportion of general charges                                   272                             305                              293                                   374                                422

                                                              5,666                           6,590                            6,075                                  7,163                             7,632

Operating profit as shown in
 revenue account                                              1,035                            1,410                           2,670                                  1,913                             1,546
 , Source:     YEB.
                                              APPENDIX 5.2(a)
                                      (referred to in paragraph 5.24)

               Yorkshire Electricity Board: 1979^80 to 1981-82
                                                    Revenue account
Current Cost                                                                                                     £'000
                                                      7979-30                    1980-81                   1981-82
Sales of electricity                             571,958                    694,808                   798,687
Rental of apparatus and
  small repairs                                     2,268                      2,563                    2,620
Miscellaneous                                         506                        510e                     576
                                                             574,732                     697,881                801,883
Deduct:
Purchase of electricity                         478,923                     564,551                   646,640
Distribution                                     22,938                      26,544                    30,500
Customer service                                  9,122                      10,806                    12,107
Meter reading, billing and
  collection of electricity
  accounts                                          8,172                     10,329                   11,493
Administration and general
  expenses                                          7,402                      8,888                    9,892
Training and welfare                                3,467                      4,324                    4,499
Rents, insurances, etc                                974                      1,172                    1,017
Rates                                               9,660                     12,346                   15,092
Proportion of Electricity
  Council's expenses                               1,806                       2,098                    2,206
Depreciation*                                     35,853                      43,724                   44,389
                                                             578,317                     684,782                777,835

Operating profit/(loss)
 before MWCA:
 Electricity supply                                            (3,585)                     13,099                24,048
 C and SA                                                       2,218                       1,614                 1,327
                                                                (1,367)                    14,713                25,375
MWCA                                                             8,030                      7,287                 5,096
Operating profit/(loss)                                        (9,397)                      7,426                20,279
Interest and financing expenses                                12,177                      12,907                 8,918

Profit/(loss) after interest
  transferred to Area Reserve                                 (21,574)                     (5,481)               11,361
 Source:   YEB annual accounts.

  * Excludes depreciation of transport assets, allocated over the various revenue account headings.




                                                            183
                                         APPENDIX 5.2(6)
                                 (referred to in paragraph 5.24)

                   Yorkshire Electricity Board: 1980 to 1982

                                          Balance sheet

Current cost                                                                                          £'000
As at 31 March                               1980                    1981                    1982
Fixed assets
Expenditure less customers'
 .contributions                       1,908,397               2,104,882               2,017,409
Less: Accumulated
  depreciation                        1,087,011               1,209,709               1,184,146
                                                    821,386                 895,173                 833,263
Current assets
Stocks and stores                        5,741                    5,721                  6,584
Contracting work in progress               567                      492                    364
Debtors:
 Electricity (consumption read
 in year) and other sales               50,836                  70,303                  80,176
 Electricity (estimated unread
 consumption)                           36,110                  40,804                  41,400
 Hire purchase and deferred
   payment instalments not yet due      10,613                   10,499                   9,431
 Miscellaneous                           2,759                    3,622                   3,001
                                       106,626                  131,441                 140,956
Bank balance and cash                    6,419                    9,768                  13,061
                                       113.045                  141.209                 154,017

Less:
Current liabilities
CEGB: Purchase of electricity           53,484                  62,924                  60,543
Creditors and accrued
 liabilities                             15,947                  16,201                  16,537
                                        69,431                  79,125                   77,080
                                                     43,614                  62,084                  76,937
                                                    865,000                 957,257                 910,200
Financed by:
Indebtedness to Electricity Council                 116,928                 110,504                  83,683
Area reserve                                        161,212                 155,731                 167,092
Current cost reserve                                586,860                 691,022                 659,425
                                                    865,000                 957,257                 910,200
  Source: YEB annual accounts.




                                                  184
                                                                                        APPENDIX 5.2(c)
                                                                                (referred to in paragraph 5.24)

                                         Yorkshire Electricity Board: 1979-80 to 1981-82—contracting and
                                                        sales of appliances trading account
Current cost                                                                                                                                                             £'000
                                                            1979-SO                                             1980-81                               1981-82
                                                                    Sales of                                           Sales of                              Sales of
                                                Contracting        appliances •          Total       Contracting      appliances   Total    Contracting     appliances   Total
Sales
Cash and credit                                     5,349             10,210            15,559          5,512             10,121   15,633      6,112          11,226     17,338
Hire purchase and similar
 sales                                               483               8,050                 8,533       457               7,077    7,534       261            6,333      6,594
                                                    5,832             18,260            24,092          5,969             17,198   23,167      6,373          17,559     23,932

Direct cost of sales
Materials                                           2,238             14,042            16,280          2,117             12,999   15,116      2,331          13,372     15,703
Salaries and related costs                          1,741               —                1,741          1,875              —        1,875      2,073            —         2,073
                                                    3,979             14,042            18,021          3,992             12,999   16,991      4,404          13,372     17,776

Gross trading profit                                1,853              4,218                 6,071      1,977              4,199    6,176      1,969           4,187      6,156
Hire purchase etc interest
 charges                                              133              2,215                 2,348        158              2,601    2,759        161           2,792      2,953
Gross profit                                        1,986              6,433                 8,419      2,135              6,800    8,935      2,130           6,979      9,109

Indirect coni
Salaries and related costs                                                                   2,906                                  3,490                                 3,760
Training and welfare                                                                           398                                   459                                    503
Transport and delivery                                                                         942                                  1,005                                 1,095
Work under guarantee and
 sundry expenses                                                                               751                                    845                                   865
Publicity and exhibitions                                                                      279                                    412                                   394
Rents, rates and insurances                                                                    280                                    319                                   333
Bad and doubtful debts                                                                         141                                    164                                   161
Depreciation*                                                                                  211                                    253                                   249
Proportion of general charges                                                                  293                                    374                                   422
                                                                                             6,201                                  7,321                                 7,782

Operating profit as shown
 in revenue account                                                                          2,218                                  1,614                                 1,327


  ' Excludes depreciation of transport assets which is included in transport and delivery.
                                                              APPENDIX 5.3
                                                     (referred to in paragraph 5.40)

            Yorkshire Electricity Board: 1977-78 to 1981-82—source and application of funds statement

                                                      7977-75                7975-79                 7979-50              7950-57                 7957-52
Source of funds
Profit/(loss) after interest                17,254                 21,325                 (21,574)              (5,481)                 11,361
Depreciation—net                            12,376                 12,829                  37,156               44,960                  45,517
Supplementary depreciation                   4,950                  5,132                    —                    —                       —
Cost of sales adjustment                      —                      —                        533                  273                     133
Monetary working capital adjustment           —                      —                      8,030                7,287                   5,096
                                                        Id SRO                 10 ''Rfi                "M IdS               d7 010                   f,"1 107
Sales of assets, customers' contributions
 and other capital receipts                              5,697                  6,278                   5,095                5,892                    6,266
total from internal sources                             40,277                 45,564                  29,240               52,931                   68,373
Application of funds
Expenditure on fixed assets during the
 year including net transfer between
 electricity boards                                     17,257                 21,043                  23,444               27,935                   26,728
Increase/(decrease) in working capital
Stocks and work in progress                    694                  1,073                    (941)                 (95)                    735
Debtors                                        286                 17,924                  (3,760)              24,910                   8,780
Bank balance and cash                        7,948                 (1,555)                 (3,218)               3,349                   3,293
                                             8,928                 17,442                  (7,919)              28,164                  12,808
Change in current liabilities                 (728)                (7,233)                (14,699)              (9,694)                  2,045
                                             8,200                 10,209                 (22,618)              18,470                  14,853
Current cost revaluation of stocks and
                                                                                                                                 X
 work in progress, not involving the
 movement of funds                           —                       —                        (28)                 102                     (29)
                                                         8 ">0fl               i A ">no               O") MK\               1 ft S?')                 1 A. 874

Decrease in indebtedness to the
 Electricity Council                                    14,820                 14,312                  28,442                6,424                    26,821
                                                        40,277                 45,564                  29,240               52,931                    68,373
  Source: YEB published accounts.
                                                                                              APPENDIX 5.4
                                                                                     (referred to in paragraph 5.53)
                                                                  YEB Revenue Account 1977-78 to 1981-82
                                                                  Comparison of actual with financial forecasts
                                                                                                                                                                                 £ million
                                                                                                              Historical cost                                  Current cost
                                                                                       7977-75                   1978-79             7979-50            1980-81            7957^52
                                                                                Actual       Estimate        Actual Estimate     Actual Estimate    Actual Estimate    Actual Estimate
    Sales of electricity                                                         454-8        447-4           515-4      520-5    571-9    566-5     694-8    768-1     798-7    841-9
    Purchase of electricity                                                      365-9        368-0          415-0.     429-1     478-9    470-7     564-6    642-1     646-6    693-1
    Gross margin                                                                   88-9           79-4        100-4     91-4      93-0     95-8     130-2     126-0     152-1     148-8
    Other income                                                                    1-1            1-1          1-1      1-2       2-8      3-1       3-1       3-2       3-2       3-4
                                                                                   90-0           80-5        101-5     92-6      95-8     98-9     133-3     129-2     155-3     152-2
   Less:
    Distribution                                         "^
    Customer service
    Meter reading, billing, collection                     I
    Admin and general expenses                             T                       34-8           34-4          41-5    39-5      51-4     47-6      .62-0     65-5      69-5      71-6
00
-J Training and welfare
    Rents, insurance, etc                                 J
   Rates                                                                             7-5           7-9           8-2      8-4      9-6      9-0      12-4      12-3      15-1      15-6
   Proportion of EC expenses                                                         1-2           1-3           1-5      1-4      1-8      1-7       2-1       2-3       2-2       2-7
   Depreciation                                                                     16-6          16-5          17-2     17-4     18-2     18-1      43-7      43-2      44-4      50-5
                                                                                   60-1           60-1          68-4    66-7      81-0     76-4      120-2    123-3     131-2     140-4
    Operating profit/(loss)
     Electricity                                                                    29-9          20-4          33-1     25-9      14-8    22-5       13-1      5-9      24-1      11-8
     C&SA                                                                            1-0           0-3           1-4      0-8       2-7     1-1        1-6      1-3       1-3       0-8
                                                                                    30-9          20-7          34-5     26-7      17-5    23-6       14-7      7-2      25-4      12-6
    MWCA                                                                             (-)           (-)           (-)      (-)       (-)     (-)       (7-3)      —t      (5-1)     (7-6)
                                                                                    30-9          20-7          34-5     26-7      17-5     23-6       7-4      7-2      20-3       5-0
    Interest and financing                                                         (13.6)        (17-1)        (12-0)   (14-1)    (12-2)   (12-6)    (12-9)   (11-9)     (8-9)    (11-1)
    Profit/(loss) after MWCA and interest                                           17-3           3-6          22-5*    12-6       5-3     11-0      (5-5)    (4-7)     11-4       (6-1)
     Source: YEB.
     * Subjects to additional costs of early retirements prior to 1.4.78, not included in financial forecasts. (1-2)
     t Not estimated.                                                                                          21-3
                                                                                           APPENDIX 5.5
                                                                                  (referred to in paragraph 5.70)

                                                                                            Operating costs
                                                                         Summaries of primary expenditure
                                                                       for the five years 1977-78 to 1981-82
                                                                       7977-75                      7975-79                      7979-50           7950-57                  7957-52
                                                                   £'000 % of budget            £'000 % of budget            £'000 % of budget £'000 % of budget        £'000 % of budget
   Expenditure summary
   Distribution                                                      8,471         101           10,572         103           12,302         106    14,251    101    16,304       101
   Customer service                                                  1,983          92            2,456         103            4,083          95     4,999    101     5,772        98
   Meter reading, billing and collection                             2,967         108            3,463         101            3,843         103     4,776    105     5,346       105
   Administration                                                    1,072         107            1,284         111            1,434         105     1,525     91     1,796       107
   Training                                                            543          99              691         106              875         105     1,048    106     1,035        97
   Welfare                                                           1,018         109            2,590         247            2,304         166     2,653    103     2,754       105
   Rent, rates and insurances                                        8,655          94            9,313          96           10,919         102    13,865    100    16,628        99
   Standardisation                                                        5         15               34          39               14         151         15    84         13       45
oo Repairs and maint-non-op buildings                                1,317         106            1,545         110            1,743         104     2,101    105     2,401        97
oo Non-industrial salaries                                          17,374         100           20,278         100           24,858         105    30,586     99    33,891        99
   General charges
       Printing and stationery                                          446        102               519         102              608         109      648    104       639        90
        Postages                                                        550        106               596         102              607          94      707    102       811       100
       Telephones                                                       357         87               392          96              426          99      545    107       654        98
        Repairs and maintenance—furniture                               143        104               175         119              348         106      432    100       518        91
   Computer expenditure                                                 479        103               582          95              608          93    1,291     97     1,240        88
                                                                    45,380           99          54,490          104          64,972          105   79,442    100   89,802        100

   Source analysis
   Non-industrial salaries                                          17,374          100          20,278          100          24,858          105   30,586     99    33,890        99
   Industrial salaries                                               8,727           98          11,039          105          13,780          106   16,700    100    19,247       103
   Materials                                                         2,262           98           2,684          109           3,350          102    3,406     92     3,741        96
   Other costs                                                      15,791           99          19,103          108          21,158          104   26,460    102    30,473        99
   Transport                                                         1,231          109           1,384          102           1,825          112    2,294    111     2,447        96

                                                                    45,385           99          54,488          104          64,971          105   79,446    100   89,798        100
     Source:    YEB.

     Notes:    1. Differences between Expenditure Summary and Source Analysis totals are due to roundings at intermediate levels of aggregation.
               2. The figures for all years exclude 132 kV system maintenance costs charged to YEB by CEGB.
                                                APPENDIX 6.1
                                       (referred to in paragraph 6.2)

         YEB: 1981 to 1985 capital programme—supplementary
                             information

                                                           1981-82          1982-83     1983-84 1984-85
                                                       Actual (as a % Present (as a % Present Present
                                                                of the estimates of the estimates estimates
                                                        (a)     total)    (b)    total)    (b)       (b)
A. Schemes to deal with new business
1. Load related
   (a) Industrial supplies                               3-4       (12%)          3-8                 2-6       2-9
   (b) New housing                                       2-0         (7%)         2-1                 2-4       2-4
   (c) Other new or increased
       supplies                                           1-2       (4%)          1-4                  1-5      1-5
   (d) (i) Services and meters for
             new housing                                 2-3        (8%)          2-7                 2-7       2-8
        (ii) Services and meters for
             other new or increased
             supplies                                    2-4        (8%)          2-6                 2-7       2-8
2. Non-load related
    (a) Service replacement                              2-5        (9%)          2-8                 3-3       2-8
    (b) Replacement meters                               0-1        (0%)          0-1                 0-1       0-1
    Sub-total                                            13-9      (48%)         15-5       (46%)     15-3     15-3



B. Reinforcement of board's systems
1. Load related                                          0-6        (2%)          0-6                 0-8       1-1
2. Non-load related
    (a) CEGB prompted                                    0-9        (3%)          1-3                  1-9      0-6
    (b) Replacement and renewal
          (i) sub-stations and plant                     0-6        (2%)          0-8                 0-6       0-7
         (ii) overhead mains                             3-7       (13%)          4.4                 4-4       4-4
        (iii) underground mains                          0-7        (2%)          0-8                 0-8       0-5
    (c) Voltage changeover and
        standardisation                                   1-3       (4%)          1-1                 0-7       0-6
    (d) Earthing for existing
        consumers                                        0-2        (1%)          0-2                 0-2       0-2
    (e) Diversions not rechargeable                      0-7        (2%)          0-8                 0-8       0-7
    (/) Telecontrol                                      —                        —                   0-5       1-8
    (g) Telecommunications for
        telecontrol                                      —                        —                             0-1
    (h) Operational improvement*                         0-7                      0-9                  —
                                                                                                       1-3      1-2
                                                                    (2%)
    (0 *                                                 —                        —                    —        —
    Sub-total                                            9.4       (32%)         10-9       (33%)     12-0     11-9


                                                                                                             continued

   * Under B2 (h) and (i) identify separately any other major schemes of a non-load related nature,
(a) Outturn prices (b) Average 1982-83 prices.




                                                            189
                               APPENDIX 6.1 (continued)

                                          7957-82          1982-83     1983-84 1984-85
                                      Actual (as a% Present (as a % Present Present
                                               of the estimates of the estimates estimates
                                       (a)     total)    (b)    total)    (b)       (b)
C. Other
1. Land and buildings
   (a) Stores, garages and
        workshops                      0-3         d%)     1-7            0-4      0-1
   (b) Offices                         0-7         (2%)    0-3            1-1      1-3
   (c) Shops                           0-2         (1%)    0-7            0-1      —
   (</) Other                          0-1         (0%)    0-1            0-4      0-4
Sub-total                              1-3         (4%)    2-8    (8%)    2-0      1-8
2. Vehicles and mobile plant           1-2         (4%)    1-1    (3%)    0-9      1-5

3. Miscellaneous
  .(a) Telecommunications and
       radio equipment (excluding
       telecontrol)                    1-0         (3%)    0-8            1-8      1-9
   (b) Tools and instruments           0-6         (2%)    0-8            0-8      0-6
   (c) Office furniture and
       equipment                       1-6:         (5%)   1-3            1-0      1-4
   (d) Apparatus and wiring on hire    0-2          (1%)   0-2            0-3      0-3
   Sub-total                           3-4         (12%)   3-1    (9%)    3-9      4-2

Total capital expenditure             29-2                 33-4          34-1     34-7




                                             190
                                         APPENDIX 6.2
                                (referred to in paragraph-6.14)

     Capital e;xpenditure split by programme heads at average 1982-83 prkes


                                                    NEW BUSINESS


                                                    REINFORCEMENT




                                                    TOTAL CAPITAL EXPENDITURE




WIT A no   Is)   CO   •»   u<   o>   ^J   C
YEARS      I     I    I    I    i    i    I


                      ACTUAL EXPENDITURE                 ESTIMATED EXPENDITURE
                        AT 1982-83 PR ICES                  AT 1982-83 PRICES

                                              191
                                                                APPENDIX 6.3
                                                       (referred to in paragraph 6.17)

                            Analysis by authorisation level of capital projects 1977-78 to 1982-83

Type of project                              1977-78               1978-79           1979-80            1980-81           1981-82          1982-83
                                                                                                                                          6 months
                                           No     £'000          No      £'000     No      £'000     No       £'000     No      £'000    No     £'000
OPERATIONAL
New business
 Board resolution                                 8,003           —      7,119      —      6,227      —        8,440    —        9,015    -       (-)812*
 Chairman/Deputy Chairman                           451           —        899      —      1,219      —        1,587    —        1,248    —           881
 Chief Officer                             —        849           —      2,861      —      2,543      —        2,169    —        1,914    —         1,243
 Area Manager                                     1,960           —      2,161      —      2,132      —        2,177    —        2,349    —         1,548
Total new business                         —      11,263          —      13,040     —      12,121     —       14,373    —       14,526    —        2,860

Reinforcement
 Board resolution                          —      2,573           —      2,397      —      1,796      -       (-)18t    —        1,677    —          834
 Chairman/Deputy Chairman                           593           —      2,058      —      1,020      —       1,781     —        1,392    —        1,008
 Chief Officer                                    1,122           —      2,383      —      2,161      —       2,415     —        2,040    —        1,071
 Area Manager                                     3,103           —      3,311      —      3,069      —       3,734     —        5,431    —        3,008
Total reinforcement                        —       7,391          —      10,149     —      8,046      —        7,912    —       10,548    —        5,921

Operational total
 Board resolution                            92   10,576     (-)14+      9,516         4   8,023          7   8,422        17   10,692        3       22
 Chairman/Deputy Chairman                    59    1,044         30      2,957        36   2,239         81   3,368        53    2,640      30     1,809
 Chief Officer                              200    1,971        330      5,244       329   4,704       261    4,584      213     3,962     103     2,314
 Area Manager                             2,065    5,063      2,027      5,472     1,935   5,201     1,782    5,911    1,979     7,780   1,132     4,556
Total                                     2,416   18,654         2,373   23,189    2,304   20,167    2,131    22,285   2,262    25,074   1,268     8,781

NON-OPERA TIONAL
Non-op land and buildings
 Board resolution                                      249        —       1,105     —          111             1,014             2,227     —         70
 Chairman/Deputy Chairman                                                                       69               330               152     —          15
 Chief Officer                                         127
                                                             :
                                                                 —           154    —          229               129               199     —         39
 Area Manager                                           88       —            82    —           83               156               177     —         19
Total non-op land and buildings                        464        —       1,341     —          492    —        1,629    —        2,755     —
                                                                                  APPENDIX 6.3 (continued)
   Vehicles
    Board resolution                                                 —        942                   2,379         —          1,771                   1,064        —            976
    Chairman/Deputy Chairman                                                   25         —           155                                 —            179                     101
    Chief Officer                                                              54                      60                      201                      75                       4         —           62
    Area Manager                                                               54                      86                       71                      55                      92                      3

   Total vehicles                                                    —       1,075        —         2,680         —          2,043        —          1,373         —         1,253         —           65

   MISCELLANEOUS
    Board resolution                                                           88         —             27                     926                     100                     449         —         1,052
    Chairman/Deputy Chairman                                         —         41                                 —             41        —            407                     562                      61
    Chief Manager                                                             223                      801                     639                     578        —            839                     427
    Area Manager                                                              228                      337                     359                     543                     867                     285

   Total miscellaneous                                               —         580        —          1,165        —          1,965        —          1,628         —         2,717         —         1,825

£2 Non-operational total
    Board resolution                                                  13     1,279          16      3,511           11       2,808           9       2,178          12       3,652            2      1,122
    Chairman/Deputy Chairman                                           2        66           2         155           5         110          15         916          15         815            1        76
    Chief Officer                                                     99       404         140       1,015         110       1,069          87         782         131       1,122           53       528
    Area Manager                                                     348       370         416         505         383         513         424         754         532       1,136          174       307
   Total                                                             462     2,119         574       5,186         509       4,500        535        4,630         690       6,725         230       2,033

   TOTAL— ALL PROJECTS
    Board resolution                                                 105    11,855           2     13,027           15     10,831           16     10,600           29      14,344           5      1,144
    Chairman/Deputy Chairman                                          61     1,110          32      3,112           41      2,349           96      4,284           68       3,455          31      1,965
    Chief Officer                                                    299     2,375         470      6,259          439      5,773          348      5,366          344       5,084         156      2,842
    Area Manager                                                    2,413    5,433      2,443       5,977        2,318      5,714        2,206      6,665        2,511       8,916       1,306      4,863
                                                                i
   Total                                                        '2,878      20,773      2,947      28,375        2,813     24,667        2,666     26,915        2,952     31,799        1,498      10,814
    Source: YEB.

    • (-) £812,000—Project cancellation (authorised 1980-81).
    * (-) £ 18,000—Project cancellation (authorised 1976-77) and resubmission of project to Chairman/Deputy Chairman previously authorised by Board resolution in 1973-74.
    J (-) 14 due to resubmission of projects to be authorised by Chairman/Deputy Chairman or Chief Officer which were previously authorised by Board resolution (authorisation limits increased).
                                        APPENDIX 6.4
                            (referred to in paragraph 6.27 et seq)
          Case studies of YEB's capital investment appraisal
                                                                                                     YEB expenditure
                                                                                                        on project
                                                                                                         type as a
                               Latest           Date of                                               proportion of
                              estimated      authorisation                                             total capital
                                gross          or latest                                               expenditure
     Scheme title                cost          appraisal                  Scheme type                   in 1981-82

A. British Gas,               £177,500           at 1982            Operational—new                          12%
   Easington—                                                       business: load related,
     11 kV mains                                                    industrial supplies

B. Lower Manor                 £37,100          May 1982            Operational—new                           7%
   redevelopment—                                                   business: load related,
     Phase 2                                                        new housing
C. Hunmanby66/llkV            £485,500          Nov 1982            Operational—reinforce-                    2%
   sub-station—                                                     ment: load related
   replacement of
   66/11 kV trans-
   formers and 11 kV
   switchgear
D. Skelton Grange—            £272,000          Oct 1982 "
   rearrangement
   of 132 kV con-
   nections                                                         Operational reinforce-                     3%
E. Ring Road,               £2,484,000          Sep 1981         >- ment: non-load related,
                                                                    CEGB prompted
   Horsforth —new
   132/33 kV sub-
   station and
   132 kV mains
F. Reconductoring             £325,000          Dec 1980            Operational — reinforce-                 13%
   Wakefield B—                                                     ment; non-load related,
   West Melton                                                      replacement          and
   132 kV overhead                                     ;
                                                                    renewal of overhead
   lines                                                            mains
G. Telecontrol              £14,000,000         [ ] 1982            Operational— reinforce-                   n/a
                                                                    ment: non load related,
                                                       •..          telecontrol
H. Development of            £2,341,000         Dec 1982            Non-operational —land                      2%
   Central Depot,                                                   and buildings; offices
   Hull—Phase 3 :
   Provision of new
   office block
I. Supply of an ICL          £1,052,000          [ ] 1982           Non-operational —mis-                      5%
   2988 computer                                                    cellaneous: office furni-
   system                                                           ture and equipment

          The case studies illustrated authorisation types representing 44 per cent of YEB's capital'expenditure in 1981-82.
          Appendix 6.1 shows the relative importance of all authorisation types. Case studies D and E illustrated to same
          authorisation type but were both included partly because D threw some light upon E and partly because each
          also raised an issue not noted elsewhere.




                                                           194
                                  APPENDIX 6.4(a)
             British Gas, Easington associated 11 kV mains

Project details
  1. YEB authorisation number, 6-7670
  Value of authorisation, £177,500
  Date of authorisation, 5 October 1982
  Date to commence work, July 1982
  Date for completion, January 1983


Brief description
    2. British Gas has established a compressor station at Easington for which
it requested 5 MVA normal and standby supplies for a load rising on occasion
to 7-5 MVA. YEB provided a normal supply by erecting a 33 kV overhead
line from Patrington 33 kV sub-station to Easington where it set up a 33/11
kV sub-station. Authorisation number 6-7670 relates to the standby supply.
This was provided by a 33 kV overhead line, energised at 11 kV, built from
Withernsea 33/11 kV sub-station to Easington where it will be automatically
connected to the 11 kV busbars of the Easington sub-station should the normal
supply from Patrington fail.


Observations on YEB proposals
   3. The normal supply from YEB can be expected to provide a high level
of reliability with a probable failure rate of less than a few hours per year.
The standby supply from YEB emanates from the same 132 kV sub-station
as does the normal supply. The 33 kV overhead lines are necessarily close
to each other over some of the route so that adverse weather conditions affect-
ing one line could affect the other. YEB agreed that there will be rare occasions
when both the normal and standby supplies would be unavailable.
   4. It is apparent from YEB's file for this project and from the capital author-
isation form that British Gas would be installing generating plant at Easington
to provide emergency electricity supplies in the event of the total failure of
YEB supplies. In a YEB inter-office memorandum dated 17 November 1981
to the Chief Engineer from the Area Manager at Hull it is stated that British
Gas proposed to supply all its load by means of its private generation in
the event of the loss of normal YEB supply from Patrington when the British
Gas load exceeded 5 MVA. This correspondence seems to indicate that the
capacity of the generating plant provided by British Gas would exceed 5 MVA.
  5. YEB subsequently calculated that its standby supply cost only 57p per
kWh likely to be rescued from interruption (cf paragraphs 6.32 to 6.35). But
Merz and McLellan advised us that YEB's standby supply was not necessary
because British Gas had installed its own generating plant. It may be that
British Gas acted too cautiously in providing for a standby supply both from
                                      195
YEB and from its own generating plant. However, we could see no evidence
in the YEB correspondence file to suggest that YEB had discussed with British
Gas the necessity for a YEB standby supply, despite YEB's corporate objec-
tives, which included the aims to provide supplies as cheaply as possible and
to advise consumers on the wise use of electricity.
  6. YEB told us that all the circumstances were known to British Gas who,
so far as YEB was concerned, must be deemed competent to make its own
investment decision. YEB did not interpret its objective of advising consumers
on the wise use of electricity as relating to large industrial consumers.




                                     196
                             APPENDIX 6A(b)
                  Lower Manor redevelopment—phase 2

Project details
  1. YEB authorisation number, 3-7184
     Value of authorisation, £37,100
     Date of authorisation, 13 May 1982
     Date to commence work, April 1982
     Date for completion, April 1983

Brief description
   2. At Lower Manor, Sheffield, 54 new houses have been built, forming
the second phase of a housing development. The houses were to be supplied
through low voltage underground cables from an existing 750 kVA sub-
station. The present load on the 750 kVA transformer is 503 kVA which
is expected to increase to 584 kVA after the connection of the new houses,
well within the transformer rating,

Observations on YEB proposals
  3. YEB confirmed that it used a computer programme to optimise the
design of networks to supply housing estates. Cable sections were selected
following studies of voltage conditions under maximum system loading to
ensure satisfactory voltage to all consumers on the estate. Merz and McLellan
advised us that the type and rating of proposed equipment appeared to be
satisfactory.




                                    197
                               APPENDIX 6.4(c)
                    Hunmanby 66/11 kV sub-station

Project details
  1. YEB authorisation number, 6-0098
     Value of authorisation, £479,500
     Date of authorisation, 14 December 1982
     Date to commence work, March 1983
     Date for completion, March 1984


Brief description
   2. The two 7-5 MVA, 66/11 kV transformers in Hunmanby sub-station
were carrying a maximum load of some 7'6 MVA in 1982; with the loss
of one transformer the other would be very marginally overloaded. An addi-
tional load of 1 MVA was expected to be connected in 1983 and a further
load of 1 MVA was expected in 1984, each imposed by extensions to the
nearby Butlin's holiday camp. Together with some allowance for annual load
growth the total demand on this sub-station was expected to rise to around
10 MVA by 1986-87. YEB subsequently told us that the maximum load on
the sub-station would rise in summer to 13 MVA because of the need to
carry, in the event of a 66 kV outage, an additional 3 MVA normally supplied
from Butterwick sub-station.
   3. YEB proposed replacing the existing 7-5 MVA transformers with two
new 12/24 MVA continuous emergency rated (CER) transformers; and chang-
ing the existing 11 kV switchboard because it had incoming circuit breakers
of an inadequate rating for the new transformers—the switchgear was 30 years
old and of an obsolete design.


Observations on YEB proposals
   4. Two 12/24 MVA CER transformers are capable of providing a firm
capacity of 18 MVA when operating under summer conditions. Firm capacity
is defined as the ability of to supply continuously the total transformer load
with one transformer not connected, as would be the case under fault or
maintenance in respect of one transformer. The provision of firm transformer
capacity is an established and accepted practice. Normally two or more trans-
formers share a sub-station load but when one transformer is unavailable
the remaining transformers supply all the load.
   5. A CER transformer is equipped with fans and oil pumps which are
automatically switched on to cool the transformer when its load exceeds its
naturally cooled rating. In the case of a 12/24 MVA CER unit the fans and
oil pumps would be switched on when the load exceeds 12 MVA so that
the transformer could carry 18 MVA in summer..
                                     198
   6. At a voltage level of 66 kV Merz and McLellan considered that any
reinforcement scheme should provide capacity for load growth for perhaps
8 or 9 years ahead. For Hunmanby YEB chose to instal transformers with
firm capacity of 18 MVA to meet an expected load of 13 MVA in 1986-87.
Merz and McLellan told us that this transformer capacity was somewhat
excessive since a firm capacity of 18 MVA was expected to be adequate until
at least the end of the present century provided no additional large loads
were connected. YEB's choice was in line with its standard policy to purchase
only one rating of 66/11 kV or 33/11 kV transformer, namely 12/24 MVA
CER throughout its area.

   7. Merz and McLellan advised us that a number of 66/11 kV or 33/11
kV transformers, of differing capacities for each voltage transformation, could
be obtained readily in the United Kingdom. For Hunmanby, a more economi-
cal solution, saving around £30,000 over the authorised scheme, would have
been to install two 12-5 MVA naturally cooled transformers. These were not
equipped with fans but could take some overload for short periods thus having
a firm capacity of 15 MVA in summer. Naturally cooled units have signifi-
cantly lower capital costs and slightly lower maintenance costs than CER
transformers. Further savings could result from matching 11 kV cabling to
expected loads instead of to the standard transformer rating as was YEB's
practice. Finally, we asked YEB whether a more flexible purchasing policy
might increase the scope for exchanging distribution equipment from areas
where demand had declined with lower rated units from areas of expanding
demand.

   8. YEB did not think that the total saving would be as high as £30,000.
YEB argued as follows. The additional cost at a few sub-stations of using
its standard transformer was slight and more than offset by the advantages
of standardisation to YEB and the ESI. A higher number of annual purchases
than the present very infrequent rate (less than one or two) by each area
board would be required before the ESI could benefit from ordering more
than one standard rating, bearing in mind production economies of scale,
particularly in design. YEB could have omitted fans from its standard trans-
former but would not then have been sure of obtaining them when later
required or have been able to use them now as spares for more heavily loaded
transformers. 11 kV cabling to match YEB's standard transformer rating was
more costly if purchased initially, than added later. Finally, the switching
of equipment between areas of differing demands was not usually economically
attractive because of the relatively high costs of dismantling, transporting
and reinstalling major items of plant, particularly transformers.

   9. We noted that YEB agreed that a saving could have been made by order-
ing a naturally cooled transformer for Hunmanby and we believe YEB should
examine its standard rating policy for transformers more closely, taking par-
ticularly into account the expected times before equipment needs to be uprated
which may in some cases, Merz and McLellan advised us, be as much as
10 or 15 years.
                                     199
Cost benefit analysis
   10. At our request, YEB attempted to carry out a cost benefit analysis
for the Hunmanby scheme. It calculated that the cost of each kWh likely
to be rescued by the project was as high as £2.40 (cf paragraphs 6.32 to
6.35), if all the costs of the project were attributed to improvements in security.
YEB subsequently told us that a major reason for replacing the transformers
at Hunmanby was because their connections were not of a standard form.
YEB had inherited transformers with different forms of connection which
could not tfe easily connected together in a unified distribution system. A
standard policy had been adopted following a cost benefit analysis. It was
not easy to attribute a particular benefit for following the standard policy
in the Hunmanby case. Merz and McLellan told us that it would not have
advised replacing transformers simply to obtain a standard form of connec-
tion.




                                       200
                                APPENDIX 6A(d)
                              Skelton Grange

Project details
  1. YEB authorisation number, 6-7670
     Value of authorisation, £272,000
     Date of authorisation, 29 October 1982
     Date to commence work, June 1983
     Date for completion, December 1983


Brief description
   2. Three 60 MVA generating sets at Skelton Grange 'A' power station
are to be retired by CEGB by the end of 1983, resulting in insufficient capacity
at Skelton Grange 'A' to meet the load normally supplied from there. YEB
therefore proposes to transfer load from Skelton Grange 'A', generating
station and 275/132 kV sub-station to Kirkstall 275/132 kV sub-station which
has spare capacity. Additionally, it proposes to transfer load from Skelton
Grange 'A' to Skelton Grange 'B' 132 kV busbars. This is to be accomplished
by the rearrangement of 132 kV overhead line and cable circuits associated
with Kirkstall and Skelton Grange 275/132 kV sub-stations. Supply to Beeston
Royds 132 kV sub-station is to be transferred from Skelton Grange 'B' to
Kirkstall sub-station. CEGB would thus make annual savings in the order
of £0*6 million to £1 million.


Observations on YEB proposals
  3. YEB expects there to be firm transformer capacity in all the Kirkstall
'B' and Skelton Grange sub-stations to beyond 1994. The definition of 'firm
capacity' used here is the same as that used in Appendix 6A(c), paragraph
4. Merz and McLellan had no adverse comment to make in so far as the
proposal would minimise costs to the ESI as a whole.
   4. There may however be a charging problem in so far as YEB will carry
the costs of a scheme which benefits the entire industry. ESI rules relating
to the ownership and responsibility for transmission and distribution assets
state that when a generating station embedded in the 132 kV system is closed,
the cost of any necessary alteration or reinforcement of the local area board
network will be borne by that area board, since the closure is in pursuit
of the economy of the ESI as a whole. YEB said that CEGB took into account
the alteration or reinforcement costs falling on to area boards when deciding
in which order power stations should be closed to minimise costs for the
ESI as a whole.
  5. Two or three area boards pressed for a review of the rules when in
1975 CEGB proposed advanced closure of a number of power stations to reduce
the over-capacity by successive reductions in national load forecasts. These
                                     201
boards considered that the advanced closures put an unfair commitment on
them to replace lost capacity, usually through having to invest in transformers
to step down from the 132 kV system instead of taking lower voltage lines
directly from the local generating station. The counter argument was that
these boards had previously enjoyed lower distribution costs through having
generating stations in their areas. In September 1981 the Electricity Council
approved a Working Party recommendation that the rule should remain un-
changed.
  6. As noted in Chapter 12, the ESI follows long run marginal cost
pricing principles in devising the structure, but not the levels of tariffs. These
principles suggest that bygones are bygones so that each area board should
bear proportionately the costs of improvements only in so far as these can
be related to the current and future demands of its own customers. Thus
the cost of allowing CEGB to make annual savings through power station
closures should, if these benefit the industry at large, be paid for by the in-
dustry at large, being recovered through a tariff based for example on each
area board's basic capacity charge.
   7. YEB said that each area board would have less incentive to minimise
its system modification costs if it were not having to meet them. But this
assumes that CEGB or the Electricity Council would scrutinise modification
proposals of the area boards less efficiently than the area boards or the Electri-
city Council scrutinse CEGB's estimates of savings arising from its proposed
power station closure programme. In principle, a redistribution of charges
could affect the willingness of area boards as a whole to bear the costs or
particular power stations and thus could alter the order in which they close.
   8. YEB considered that such a redistribution of charges would have a de
minimis effect on each area board's finances, although it had not made a
detailed calculation. YEB also argued that it would be unfair to alter the
rules now that its consumers had faced some of the costs of the power station
closure programme which was already well advanced in its area, whereas the
programme in London Electricity Board's area was only in its early stages
and the bulk of its costs had still to be met. Overall, the problem is changing
in so far as no power stations by the 1990s will be connected at or below
132 kV so that in general no reinforcement of area board systems would
be necessary in respect of closures thenceforth.




                                       202
                                    APPENDIX 6A(e)
                              Ring Road, Horsforth

Project details
   1. YEB authorisation number 8-2704
      Value of authorisation, £2,484,000
      Date of authorisation, September 1981
      Date to commence work, April 1982
      Date for completion, October 1983

Brief description
   2. YEB had originally, in July 1976, authorised for Ring Road, Horsforth,
a new 132/33 kV sub-station equipped with two 90 MVA transformers to
offset a shortfall in capacity resulting from the expected retirement within
a year or two of Kirkstall 'C' Power Station.
   3. Following the original authorisation, YEB received planning objections
to part of the scheme, namely a double circuit 132 kV overhead line from
Kirkstall to Ring Road, Horsforth. The objections resulted in a public inquiry
in which YEB argued that its scheme would be cheaper than what it considered
to be the best alternative of installing additional transformer capacity at the
retiring station, Kirkstall. This alternative followed the usual solution to capa-
city lost through generating plant retirement. The comparative costs which
YEB produced for the inquiry are shown at Annex A.1 YEB's preference
for the authorised scheme stemmed from its belief that it would provide supply
more efficiently to existing and future loads and from its expectation that
it would be necessary in 10 or 15 years time to transfer Rodley 132 kV sub-
station from the reduced Skelton Grange system to the Kirkstall system. If
the Ring Road, Horsforth, sub-station were established, a relatively short
overhead route from Rodley to Horsforth could be used for the transfer,
instead of a more expensive underground route from Rodley to Kirkstall.
  4. As a result of the public inquiry, YEB was instructed to adopt 132 kV
underground cables over part of the route from Kirkstall to Horsforth, signifi-
cantly increasing the cost of the scheme which was then revised and resubmit-
ted for Board approval during September 1981 (see paragraph 1). Because
of a reduced load forecast YEB decided to install only one 90 MVA trans-
former and to lay initially only one underground cable circuit.
  5. Meanwhile, as an interim measure, YEB met the load at Kirkstall, which
in 1976 was 125 MVA at 33 kV, by arranging there two 30 MVA 132/11
kV transformers and two 20 MVA 11/33 kV transformers, which together
with the two existing 60 MVA 132/33 kV transformers were assigned a firm
   1
     The costs appeared to show that YEB's authorised scheme was £400,000 cheaper than the
alternative; internal costings, which discounted future expenditure by 5 per cent per annum,
showed the saving to be £140,000.
                                           203
capacity (see Appendix 6A(c), paragraph 4) of only 101 MVA because of the
load sharing capability of these units. The remaining shortfall of 24 MVA
was met by transferring load to Leeds North sub-station which was in turn
supplied by Skelton Grange sub-station.

Observations on the proposed schemes
   6. Merz and McLellan advised us that the 180 MVA transformer capacity
originally proposed in July 1976 for Ring Road, Horsforth, was excessive,
bearing in mind the load forecast at that time which gave rise to an expected
shortfall in capacity of around 65 MVA by 1983-84. YEB has standardised
on only one rating, namely 90 MVA, of 132/33 kV transformer and Merz
and McLellan considered that one or two other ratings should be available
(cf Appendix 6.4(c), paragraph 9).

  7. As shown in Annex B, Merz and McLellan advised us that the Kirkstall
scheme would be around £0'4 million cheaper than the original Ring Road,
Horsforth scheme if allowance were made for its being cheaper to build on
an established site as at Kirkstall, rather than on a greenfield site such as
at the Ring Road; and if the transformers at Kirkstall were arranged in a
manner not in accordance with YEB policy. The Kirkstall scheme would be
£0-9 million cheaper if the Rodley transfer could be ignored.
  8. For the interim solution, Merz and McLellan advised us that the assig-
nation of only 101 MVA for the grouping of relatively old transformers was
prudent, four of them being more than 40 years old in 1976. We wondered
whether this solution made the new Ring Road, Horsforth, scheme redundant,
bearing in mind that there had apparently, if fortunately, been no sub-station
overloading in the Kirkstall area since 1976 and that, as a result of lower
load forecasts, no overloading problems were now expected at Skelton Grange
or Kirkstall sub-stations up to 1994. YEB pointed out that the four old trans-
formers at Kirkstall were in a very poor condition, with leaking radiators
and unserviceable voltage control equipment, and should be removed from
the system as soon as possible; failure of any of the 132 kV transformers,
including the two 60 MVA transformers of more recent manufacture, would
cause widespread loss of supplies in the Leeds area, constituting an unaccept-
able risk. In addition, there was a need to consider the future transfer for
Rodley sub-station (see paragraph 3).
   9. As a further possible alternative to the presently preferred scheme, Merz
and McLellan noted that the load of the Ring Road, Horsforth area was
and is supplied from Kirkstall by a number of 33 kV cable circuits, apparently
with spare capacity and in good condition. In addition, a currently redundant
66 kV double circuit overhead line between Kirkstall and the Ring Road,
Horsforth area could apparently be used, if required, to reinforce the 33 kV
circuits. But, bearing in mind the transfer of Rodley 132 kV sub-station, we
concluded that without a much more detailed study of YEB's strategy in
relation to power station closures it was impossible to assess the case fully.


                                     204
                                     ANNEX A TO APPENDIX 6A(e)

            Summary of expenditure on proposed reinforcement
               and on alternative reinforcement at Kirkstall

                                                                                                  Alternative
                                                                      Proposed                   reinforcement
                                                                   reinforcement                  at Kirkstall
Item                                                               at Ring Road                  Power Station
                                                                          £                             £
  INITIAL EXPENDITURE
  132 kVswitchgear at
    Kirkstall                                                          180,000                       180,000
  0-52 km 2 x 500 mm2
     132 kV cable and
    terminations                                                                                     258,000
  4-34 km 175 mm2
    double circuit
     132 kV line                                                       434,000
  132/33 kV sub-station                                              1,137,000                     1,137,000
  33 kV cabling                                                        185,000                       214,000
                                                                     1,936,000                     1,789,000
   Capitalised value of
     additional 33 kV
     system losses                                                                                   220,000
   Additional2 cost for
     400 mm 132 kV
     overhead line
     conductor                                                          87,000
                                                                     2,023,000                      ,0,0
                                                                                                   20900
   Additional cost for
    undergrounding
    0-82 km by 2 x 500 mm2
     132 kV cable                                                      265,000
                                                                     2,288,000                      ,0,0
                                                                                                   20900
2. FUTURE EXPENDITURE
   Uprate one 132 kV
     circuit by 0-85 km
     1 x 500 mm 2 cable                                                195,000
   132 kV connection to
     transfer Rodley from
     Skelton Grange to
     Kirkstall 275/132 kV
     sub-station                                                       125,000                       999,000
                                                                     2,608,000                     3,008,000
  Source: YEB.
  Notes:   1 Prepared for Public Inquiry January 1981.
           2 For its internal use, YEB discounted future expenditure (expected to take place 10 years later) by 5 per cent
             per annum, reducing the totals of £2,608,000 and £3,008,000 to £2,485,000 and £2,622,000 respectively.




                                                        205
                            ANNEX B TO APPENDIX 6.4(e)

Ring Road, Horsforth, and Kirkstall sub-station schemes
                (all figures in £'000)

                                                                      Estimated adjusted
                                                                  . by Aferz and McLellan
                                                                 Ring Road         Kirkstall
Initial expenditure
132 kV switchgear at Kirkstall                                       180                    -(ft)
132 kV overhead lines                                                408
132 kV underground cables                                            378                   220
132/33 kV sub-station                                              1,137                   850(6)
33 kV cabling                                                        203                   203
Capitalised cost of extra losses                                                           220
                                                                   2,306                 1,493
Discounted future expenditure
Duplicate one of 132 kV underground cables (10
years later)                                                          120
Transfer Rodley load from
Skelton Grange to Kirkstall
(10 years later)                                                       77                  613
Total expenditure                                                  2,503                 2,106

  Source: Mere and McLellan.
  Note: The significant differences between YEB's internal and Merz and McLellan's costings are that Merz
        and McLellan would have:
        (a) saved around £180,000 by arranging the transformers at Kirkstall, in a manner which was not
            in accordance with YEB policy; and
        (b) expected it to be around £287,000 cheaper to build a sub-station or an established site such
            as at Kirkstall rather than on a greenfield site such as at the Ring Road.




                                                206
                               APPENDIX 6A(f)
       Reconductoring Wakefield (B' to West Melton 1 and 2
                      132 kV overhead lines

Project details
  1. YEB authorisation number, 8-3337
     Value of authorisation, £325,000
     Date of authorisation, 16 December 1980
     Date to commence work, May 1981
     Date for completion, November 1981


Brief description
   2. The ownership of 132 kV overhead lines in YEB's area was transferred
from CEGB to YEB on 1 April 1969. CEGB was however retained as an
agent, carrying out the planning, construction and maintenance of the lines.
YEB took over the planning and construction of its lines in the mid-1970s
and is now also taking over the maintenance. YEB had, before the ownership
of the lines passed to it, little experience of the construction or maintenance
techniques for these 132 kV lines and furthermore such experience could not
be obtained in a short period. YEB was, and still is, dependent on advice
from CEGB, particularly for maintenance requirements.

   3. As a result of a CEGB report and recommendation, YEB agreed that
a number of its 132 kV overhead lines over 25 years old should be
reconductored; the policy was expected to cost around £300,000 per annum
for 10 years. So far YEB has approved the capital expenditure for three lines,
with gross costs totalling £540,000; the work was to be engineered and carried
out by CEGB.
  4. The Elland to Thornhill and Elland to Halifax 132 kV overhead lines
had already been reconductored at YEB's expense, prior to the authorisation
of the scheme which we considered and which had been deferred by CEGB
until 1982.


Observations on YEB proposal
   5. The reconductored lines in the scheme which we considered were about
25 years old, which Merz and McLellan told us was surprising bearing in
mind that lines of this type would normally be expected to have much longer
lives.
   6. From the information obtained from YEB it appeared that for some
sections of the lines the steel core inside the aluminium conductor was greased
only partially when the conductor was manufactured in accordance with the
specification of the day. Present practice is to grease fully the steel core and
first layer or layers of aluminium. As a result of earlier practice, corrosion
                                     207
apparently took place on the conductors of the Wakefield 'B' to West Melton
lines. The aluminium strands of the conductor oxidised and yielded low ducti-
lity figures; Infra-red camera examinations showed hot joints and fittings.
A number of failures occurred over the previous seven years, a few of which
appeared to be attributable to aged conductors.
   7. The information provided in the YEB capital authorisation form and
in other papers examined did not, in the view of Merz and McLellan, justify
the cost of reconductoring. Merz and McLellan told us that it would have
required a much more detailed report on the CEGB investigations and to
know, for instance, how many samples of conductor were examined and where
on the lines the samples were obtained, before saying whether the expenditure
was justified.
   8. We think it surprising that YEB approved expenditure for reconductor-
ing three lines when it was apparently not able to assess fully whether or
not the work was essential. YEB did carry out some post-investment sampling
of cables taken down by CEGB. We note that further schemes for reconductor-
ing of 132 kV lines in the YEB area have been postponed.




                                    208
                               APPENDIX 6.4(g)
                     A telecontrol scheme for YEB

Project details
  1. Value of authorisation, £13,000,000
     Date of authorisation, February 1983
     Date for commencement, November 1984
     Date for completion, February 1989


Brief description
   2. At present CEGB, as agent for YEB, telecontrols the 132 kV circuit
breakers and associated equipment in YEB's area. (The control system and
the 132 kV circuit were formally taken over by YEB from CEGB in 1969.)
The control system is said to be obsolete but is still in use. CEGB has agreed
to maintain it until 1987 when it must be replaced or other arrangements
made. As a stop-gap measure for 132 kV sub-stations built since 1974, YEB
installed cheap multiplex alarms without remote control facilities. YEB cannot
at present control remotely the rest of its electricity supply system.
  3. YEB proposed to introduce a telecontrol system which it believed was
broadly similar to those already installed by many of the other area electricity
boards in England and Wales. A limited number of remote control rooms
would be able to identify faults, to gather information about feeder loadings
and to control circuit breakers in all 132 kV, 66 kV, and 33 kV sub-stations.


Observations on YEB proposals
  4. Based upon its experience with similar installations, Merz and McLellan
considered the estimated cost of £13 million for the scheme to be reasonable
for the facilities that would be provided.
   5. The telecontrol scheme would allow earlier restoration of electricity sup-
plies following a system fault, particularly in rural areas, than was possible
with the present control system.
   6. YEB derived the estimated increase in kWh that the scheme was likely to
rescue from interruption by examining fault statistics and simulated network
conditions using typical parameters. Merz and McLellan believed these calcu-
lations to be reasonable.
   7. YEB assumed that consumers would be willing to pay up to £1.50 for
each kWh saved from interruption, around 35 tunes the normal cost of a
unit of electricity. The 35 times multiplier was derived from a survey, reviewed
by the Electricity Council, of consumers' opinion in Finland, following a strike
lasting nearly eight weeks of power station technicians in 1977. The result
was said to be substantiated by a recent survey of consumer opinion in Sweden,
                                     209
estimates of the costs of the blackout in New York in 1977, and several other
studies none of which related directly and comprehensively to United King-
dom consumers.
   8. The Finnish opinion survey suggested that the value placed by consumers
on preventing an interruption varied widely according to, for example, the
occupation or business of respondents, whether they were in urban or rural
areas, the length or time of day of any interruption and whether advance
warning of an interruption was given. YEB derived the 35 times multiplier
by reducing by 20 per cent the average value that it inferred was placed by
Finnish consumers on the prevention of emergency interruptions. YEB said
the reduction was in line with Electricity Council advice to cover what it
called inevitable uncertainties; moreover, under-investment in a distribution
system was less costly to rectify than over-investment. YEB also pointed out
that the 20 per cent reduction was just sufficient for its recommended scheme
still to show a 5 per cent real rate of return (see paragraph 13).
   9. We were uncertain how far the Finnish opinion survey could indicate
the benefits YEB consumers would derive from the telecontrol scheme. The
premium a consumer would be willing to pay to avoid an emergency interrup-
tion is likely to depend upon the probability of it otherwise occurring. This
may be very low, particularly if the proposed improvement in security relates
to a system which already has a high capability for avoiding interruptions,
as Merz and McLellan advised us was the case for YEB (see paragraph 17).1
   10. We were also uncertain how much allowance should be made for the
effect that a certain level of security for one consumer, especially in a residen-
tial area, may well give much the same level of security for his neighbour,
leading a respondent in an opinion survey to suggest a larger value than
he really has on improved security, especially if he believes that the probability
of power cuts will be lower the higher the sum he suggests; and that the
burden of paying for improved security will be spread on to his neighbour.
YEB argued that, conversely, a consumer may understate the cost of an inter-
ruption in order to avoid increased charges.
   11. Other types of studies reviewed by the Electricity Council involved plac-
ing a value on domestic consumers' leisure time; making a macro-economic
estimate of the cost of a national blackout; and inferring the value placed
on security by previous electricity distribution managers through measuring
the costs of rescued kWh implied by their practices.
   12. Almost 90 per cent of the measured annual net benefits claimed for
the telecontrol scheme came from calculating the amount of energy likely
to be rescued at £1*50 per kWh; and deducting net maintenance costs of some
£240,000 per year. For the rest, annual savings of £159,000 were estimated
   1
     YEB rejected the idea that it should have applied a range of multipliers to different parts
of its systems, reflecting that whereas its preferred telecontrol scheme was replacing a perhaps
highly valued 132 kV security system, it was elsewhere improving upon an already acceptable
system, particularly in urban areas. Research had found no significant difference between the
multipliers relevant to the different voltage levels of the system to be telecontrolled; there were
greater variations between multipliers relating, eg, to different times a day.
                                               210
would arise from reduced staff time and travelling costs incurred in carrying
out field work, comprising data collection, normal and emergency switching
and other operations.
  13. The scheme was marginally viable when measured costs and benefits
were discounted at the required 5 per cent real rate of return. YEB emphasised
that it had deliberately minimised expected benefits; unmeasured benefits
included:
  (a) faster restoration of supplies to collieries to meet safety standards,
       although interruptions lasted rarely longer than a few minutes because
       of the already relatively high degree of security of their supplies;
  (b) better handling of national supply emergencies, in line with other area
       board telecontrols;
  (c) better network planning, although savings from this would emerge only
       when load started growing again and even then savings would not
       appear for many years; and
  (d) a faster reaction to, eg, gas alarms from large transformers and oil
       pressure alarms from oil-filled cables.

   14. In respect of alternative schemes presented to the Board, the undis-
counted capital costs and estimated annual disbenefits of a number of options
were compared to their disadvantage with those of the recommended scheme.
The so-called 'do-nothing' option involved spending around £0'4 million on
replacing the obsolete 132 kV remote control system with more multiplex
alarms and putting general alarms elsewhere. No annual benefits were esti-
mated for this option which was rejected because it would not have met the
security standards recommended by the Electricity Council. Other rejected
options, nof presented to the Board, included telecontrolling down only to
the 33 kV switchgear.
   15. The recommended scheme was eventually authorised for a number of
reasons. Inter alia, a 5 per cent rate of return was considered sufficient bearing
in mind the likely lack of a capital budget restraint and that even if another
option could show a higher rate of return it would not have met the security
standards recommended by the Electricity Council.

  16. YEB subsequently told us that it was sure none of its consumers would
object to the recommended scheme if they realised that they could be getting
aborted energy cut by 28 per cent for only 0-004 pence per unit. Since the
average cost of a unit is about 4-3 pence, the average consumer would be
getting a big improvement in service for less than 0-1 per cent on his bill.
   17. Merz and McLellan advised us that security was already of a very high
standard, particularly in urban areas. The telecontrol scheme was either replac-
ing an obsolete system or adding marginally to this very high standard.




                                      211
                               APPENDIX 6A(h)
    Centralisation of Hull Area and Hull District Engineering
       functions at central depot, 200 Clough Road, Hull:
                      Phase 3—Office block

Project details
  1. YEB authorisation number, 6-0052
     Value of authorisation, £2,245,200
     Date of authorisation, 14 December 1982
     Date to commence work, July 1983
     Date for completion, March 1984


Brief description
   2. The office block represents the third phase of the centralisation of Hull
Area and Hull District Engineering functions at YEB's central depot in Hull.
Phase 1 was the construction of an additional storey on and refurbishment
of the existing offices on the site; it was completed in May 1980, having
cost around £260,000. Phase 2 is the construction of a new Area and District
engineering workshop, together with a stores building and ancillary works.
For this, the Board authorised in October 1981 gross expenditure estimated
at £2,100,000. Work was expected to start in January 1981 and last two years.


Observations on YEB proposals
   3. No benefits were identified for Phase 1 which was an essential preliminary
stage to Phases 2 and 3. YEB said the three phases should be taken together.
For the other two phases, savings were estimated in terms of:
   (a) the sale or lease of depots and offices currently being used elsewhere
       in Hull;
   (b) lower maintenance, electricity and telephone costs; and
   (c) lower numbers of staff required as messengers and less time spent by
       other staff travelling between depots and offices.

   4. YEB discounted estimated costs and benefits valued at constant prices
by 0 per cent and 10 per cent, interpolating between these results to estimate
the discount rate (known as the internal rate of return) at which estimated
costs equalled estimated benefits. The internal rates of return were estimated
to be 7 per cent for Phase 2 in September 1981 and 7-2 per cent for Phase
3 in November 1982. YEB approved the expenditures on these phases because
it deemed their rates of return were high enough; moreover, measured savings
had been conservatively estimated and there were other savings which could
not be measured objectively (eg improvements in management, supervision
and communication resulting from staff being located on one site).
                                      212
  5. When the Board made its decision, YEB had in mind a 10 per cent target
real rate of return, discounting it for benefits which could not be measured.
More recently, it has followed Electricity Council advice by moving towards
a 5 per cent target real rate of return on all types of investment, in line
with the 1978 White Paper.1
   6. Treasury guidelines on 'Investment Appraisal in the Public Sector', issued
in 1982, recommend against the use of the internal rate of return which can
give misleading results when comparing mutually incompatible projects or
in times of capital restraint. Instead the guidelines recommend computing
net benefits (divided by capital expenditure where capital rationing is necess-
ary) discounted at target rates of return. The guidelines also recommend the
use of sensitivity analysis to highlight the impact of critical but uncertain
assumptions. The guidelines are issued initially to central government account-
ing officers but are also intended to be relevant to nationalised industries.
The Department of Energy have not drawn them specifically to the attention
of the Electricity Council partly because the Electricity Council had drawn
up its own guidelines some years ago, on the basis of which area boards
have prepared their own guidelines.
   7. As noted in paragraph 6.23, non-operational schemes are controlled by
Head Office within an agreed total programme. For the Hull phases, no alter-
native project, apart from carrying on as before, was considered formally
by the Board (see paragraph 11). YEB did not subject its results to detailed
sensitivity checks for unexpected changes in costs and benefits. It relied instead
on assuming that it had under-estimated net benefits, in the case of staff time
saved by up to 20 to 25 per cent. The calculations were subject to close scrutiny
by Head Office which accepted the Hull Area estimates of staff-time savings,
similar estimates for the centralisation of depots and offices in Doncaster
in 1976 having been proved accurate by a post-investment appraisal. YEB
called in outside advice for costings only in the case of architects required
for Phase 3, YEB's own architects being fully employed on Phase 2. Estimated
costs for Phase 2 rose by around 15 per cent at constant prices during the
period between the Board's authorisation in principle in September 1980 and
its final authorisation in October 1981. However, prices tendered in April
1982 suggested that costs might be around 20 per cent lower than the level
finally authorised by the Board.
   8. We discounted by 5 per cent in real terms YEB's estimates of costs
and benefits for all three phases and converted the values to a common base
year, 1983-84, and a common price level, for September 1981. We then tested
the sensitivity of the Phase 2 and Phase 3 estimates, albeit only by varying
total costs and total benefits by certain percentages in either direction. We
found that only under the pessimistic assumptions of non-compensating errors
for total costs and total benefits in the order of 20 per cent might the three
Phases, taken together, not have been approved, given a 5 per cent target
real rate of return. In the event, as indicated in paragraph 7, the tender figure
for the building contract for Phase 2 was about 20 per cent lower than
originally forecast.
  1
      Op cit.
                                      213
   9. It is possible that the net benefits should have been higher than estimated.
First, no benefit was included for the possible sale of YEB's Osborne Street
site. When Phase 2 was designed, staff had already been moved from Osborne
Street but the site there remains partly in use as an operational sub-station
and its future is still uncertain.
   10. Secondly, the standard of insulation for the office block in Phase 3
exceeded, if only just, the requirements laid down by Department of Environ-
ment regulations. Such investment was thought likely to pay for itself within
two years. No credit was taken for the advertisement value of achieving a
highly efficient standard of heating and ventilation through recently developed
heat pumps.

Development of options
   11. Alternative sites inside Hull were not looked at in detail, although YEB
thought it had a fair idea of their relative values and had implicitly borne
them in mind. Land adjoining the existing office block had been bought as
early as the 1960s, having since been under-used for a transport section and
covered storage. The land appears to have been purchased mainly with some
form of the present centralisation project in mind. Alternative sites outside
Hull were not considered. The question of rearranging areas, including com-
bining Hull and Grimsby, is discussed in Chapter 4.




                                       214
                                APPENDIX 6A(i)
        Enhancement of the ICL dual 2972 computer system

Project details
  1. YEB authorisation number, 8-3593
     Value of authorisation, £1,000,000
     Date of authorisation, July 1982


Brief description
  2. In 1982 YEB proposed to uprate its current computer capacity from
an ICL dual 2972 to an ICL dual 2976 system and to acquire an ICL 2988
processing system in order to meet its known computer requirements up to
the end of 1985.
   3. The current dual 2972 system, replacing the previous ICL System 4 com-
puters, was commissioned in August 1980, following the Board's acceptance
of ICL's tender which was the only one it invited. The sole invitation resulted
from an 18 month survey of more widespread tendering requested by industry
in general and other area boards, particularly the South of Scotland and the
North West Electricity Boards who were seeking to replace configurations
about the same as YEB's and whose future workloads would be similar.
   4. From June to October 1981, YEB staff and ICL carried out a detailed
sizing exercise to determine whether the dual 2972 system could cope with
the new projects proposed by the Computer Development Group (see Chapter
8) as well as with the higher than initially expected load from existing uses.
  5. YEB staff and ICL then considered how best to meet YEB's known
computer requirements up to the end of 1985. As a result, ICL offered the
package noted in paragraph 2.


Observations on YEB proposals
   6. In essence, cost benefit appraisal had been applied to the projects
approved by the Computer Development Group, leaving a cost-minimisation
exercise for determining which option to pursue for additional hardware. That
apart, YEB confidently expected that fulfilment by its recommended scheme
of its known computer requirements up to 1985 and of its likely requirements
beyond would achieve savings equivalent to at least 25 clerical grade staff,
the critical number required to earn a 5 per cent real rate of return over
seven years on £1 million capital expenditure. (To earn 10 per cent, the critical
number was 29.) YEB's confident estimate resulted from experience gained
from a number of computerisations of clerical work over the last decade or
so, the larger of which have generally been subject to detailed post-investment
appraisals.
                                      215
   7. YEB did not seek outside advice, apart from ICL, in devising this scheme.
It said that options were severely limited by the need to make the enhancement
compatible with current computer equipment. Plug compatible equipment
manufactured by companies other than ICL could have been used, as could
other equipment through the use of software aids. These options were not
considered desirable because of likely increases in maintenance costs and prob-
lems in fault identification and correction when dealing with two manufac-
turers. Options were also limited in 1977 when the Board decided to request
a tender only from ICL. This had been done partly because conversion aids
were not then well developed and partly because a new hardware system needs
to be run in tandem with its predecessor for at least two years while faults
in the new system are eliminated (incompatible systems running in tandem
require different software and costs are significantly increased). A centralised
computer system, rather than linked area computers, was preferred in the
1960s, when YEB introduced its first computer; this was considered the only
sensible course because lower unit costs result from economies of scale and
from faster responses. Distributed processing was again considered in 1982
but found to be too costly.




                                     216
                                        APPENDIX 7.1
                               (referred to in paragraph 7.11)
                 Sequence of design and planning of a typical sub-station
                             5 years to placing of contract stage
                      2 years from capital authorisation to completion
                                         Consumer demand                 The public

                                                 T
                              I Identification of consumer requirement   Terms Engineers

                                                 I
                                      The 'what' specification           System Design Section

Includes determination of                        T                       Construction, Building and
transformer requirements               The 'how' specification
                                                                         Technical Sections
and . . . specifications
                                                 T
                                  Report containing draft schedules
                                  for the distribution reinforcement     System Design Section
                                           instruction (DRI)


Technical consent plus             Routing of lines clarification        Construction & Estates
deemed planning consent           comments on technical proposals        ACEs, Safety Eng & CEGB

                                                 T
                                  Refinement of technical proposals      System Design Section

                                                 T
                                          Costs of proposals             Construction Section

                                                  T
                                              Final DRI                  System Design Section


                                                Gives


                                    Technical consent for scheme         System Design Section


                                              Enabling

                                                  I
                                       Detailed Engineering of
                                     project up to point prior to        Construction Section
                                         placing of contracts

Authorisation of rates of
spend pre-determined . . .         Authorisation of project spend        System Design Section
by policy
Specified tendering . ..
                                  Selection of specific contractors      Construction Section
process
Authorisation of rates of
spend pre-determined .. .       Authorisation of individual contracts    Construction Section
by policy

                                        Contracts placement              Construction Section
                                                                         Contracts Section

Delegation of site               Management and control of project
supervision to area . . .                                                Construction Section
                                      through to completion
construction section
Source: MMC study.

                                                 217
                                                         APPENDIX 7.2
                                                (referred to in paragraph 7.15)

                             Unit Distribution in YEB System—1981-82

      TOTAL INPUT - FROM CEGB 21,420 M AND FROM OTHER SOURCES 5 M                                        SMD = 4,205 MW                  LF - 57.9%

      AGGREGATE MD ON BSP's 5256 MVA.                      AT PF. 0.931, MD = 4893 MW




                                                      <>                                                 JL
                                                                                                                                         Demand
                                                                                                                                         Diversity
                                                                                                                                         0.86




                                                             f~       d
                                                                      1                                  I
                                                                                                         1^                                      **.«.. .
                                                                                                                                         .        132 kV
                                                             L               __,
                                                                                     1
                                                                                         14950 M                                     T          555 M

        x^-v    400/66 kV(1 off) /- '•V 275/66 or 33 kV (14off|/^ «v 132/66 or 33 or 22 kV (55 off) /*>^ 132/1 1 or 6.5 kV (6 off)
        C •CI MD 128 MVA
                360 MVA
                Cap.              (    JCap. 3735 MVA         f     I Cap. 8765 MVA                 (   ) Cap. 360 MVA
        >=
        c ) U = 36%
                Agg.            >« S< Agg. MD 1603 MVA        >CIK Agg. MD 3372 MVA                 >0< Agg. Md 153 MVA

        sI
           ' LF - 34%
                                 f      JU = 43%
                                    V LF = 46%
                                      X
                                                              (
                                                                  r*
                                                                    )U = 38%
                                                                S LF = 52%
                                                                      (Transformer losses 93 M)
                                                                                                   {    J U = 43%
                                                                                                    ^rS LF = 43%
                                                                                                          (Transformer losses 4 Ml
          t (PF = 0.726)            1    (PF • 0.888)           '     (PF = 0.967)                        (PF = 0.953)

          I 273 M                        5634 M             j        14857 M




71 M
     I
   NEEB
                         I
                 BST CUSTOMERS
                 2638 M
                                                       f
                                                33 kV NETWORK
                                                BST CUSTOMERS
                                                                                 18085 M
                                                                             (Mains losses 82 M) t

                                                                                             LOCAL
                                                                                                     1




                                                                                             GENERATION
                                                                                                                      £
                                                                                                                          emand
                                                                                                                          iversity

                                                                                                                          0.93


MD = 21 MV *,    Agg. MD 946 MVA                688 M                                        RM
                 LF=41%                         Agg. MD 1.10 MVA
                                                LF = 74%             /^\66or33or22kV/11 or6.6kV                   (36.8 off)
                                                                                     1 1 f O IVIVM
                 (PF. - 0.783)                  (PF.- 0.961)         >«=<lA9^f!ID 4379 MVA
                                                                    (        ) U = 39%
                                                                              Lf
                                                                     ^Y
                                                                      •
                                                                                 °* 7%
                                                                           (Transformer losses 128 M)                                '
                                                                        I 17167 M (PF. = 0.95)
                                                                                                                                             551 M
                                                                        1                                                                               ]1(..   Demand
                                                                                                                                                                Diversity
                                                                                151 KM                                                                          0.71
                                                                                (Ma ns losses 147 M)


      BSTC USTOMERS              OTHERPRIMARY
                                         *                        IlkVNETWORK
                                                                        '*                                                                          OTHER
                                 SUB/ST CUSTOME RS                CUSTOMS RS                                                                        SOURCES
                                                                                                           10718 M
      487 M                      2038 M                           4333M                                                                             5M

      LF = 64%                   LF-45%                           LF=41%
      (PF.- 0.928)               (PF. - 0.96)                     (PF. = 0.95)
                                                                                     9858 M '                         £160 M


                                                           GROUND MOUNTED                                                  POLE EQUIPMENTS
                                                           11or6.6kV/LV|135" 6 off) ^Av            ^^                      11or6.6kV/LV 1 15426 off)
                                                           Cap. 7809 MVA
                                                           Agg. MD 3849 MVA           ( I
                                                                                            w      ( J
                                                                                                               w          Cap.
                                                                                                                          Agg.
                                                                                                                               861 MVA
                                                                                                                               MD 600 MVA
                                                           U = 49%
                                                           LF=30%
                                                                                            (j
                                                                                            vx                 I
                                                                                                               Vx
                                                                                                                           U = 70%
                                                                                                                           LF = 16%
                                                           (Transformer losses 213 M)   |            1                     (Transformer losses 44 M)
                                                           (PF. = 0.96)                T 9645 M 816 Ml                     IPF.   = 0.97)

TOTAL YEB SYSTEM LOSSES                                                                                     10461 M
EXCLUDING 132 kV MAINS * 958                                                                                (Mains Services and Meter losses 242 M)
OR 4.5% OF PURCHASES

TOTAL SENT OUT BY YEB « 20472

TOTAL SALES TO CUSTOMERS = 29353                                         f                     I                  I                             1
                                                                  Small Industrial         Domestic            Comm.                          Other
                                                                     1380M                  5847 M             2052 M                         940 M



Source: YEB.




                                                                              218
                                       APPENDIX 7.3
                        (referred to in paragraphs 7.25 and 7.34)
1981-82—Summary of incidents by fault cause and main equipment group—LV

                                                                                     Yorkshire
                                                            O/H       Power     Sw/Gr
                                                    Total   lines .   cables   Fuse/Gr Others
Total all causes                                    9,268   1,219     5,882      666     1,501
01 Lightning                                           8       2          3        1        2
02 Rain                                               18      —           5                13
                                                                                 —
03 Snow, sleet and blizzard                          272     238          5       5        24
04 Ice                                                 3       3         —       —         —
05 Freezing fog and frost                              1       1         —       —         —
06 Wind and gale (excl windborne material)           122     108         —       13         1
07 Solar heat
10 Airborne deposits (excl windborne mater-
   ial)                                                1       1
14 Condensation                                        2      —           1       —         1
15 Corrosion                                          17       7          9       —         1
16 Mechanical shock or vibration                       9       1          5        1        2
17 Ground subsidence                                 112       1        110        1       —
18 Flooding                                           46      —           9       9        28
19 Fire not due to faults                             56       6         24       —        26
20 Growing or felling trees (not felled)             177     169          3       4         1
21 Windborne materials                                17      15         —         1        1
22 Disruption of intended indoor environ-
   ment                                                19     —           2        1       16

     Total weather and environment                   880     552        176       36      116

30 Birds (including swans and geese)                   4       4         —
32 Vermin, wild animals and insects                    4      —           3      —          1
33 Farm and domestic animals                          22      22         —       —         —
     Total birds, animals and insects                 30      26           3               .1
39 Wilful damage interference or
   theft, accidental contact, damage
   or interference:                                  107      21         25      16        45
42 by Post Office or its contractors                 126       1        124      —          1
43 by Gas Board or its contractors                   419      —         419      —         —
44 by water/sewage authorities or
      their contractors                              248       7        241
45 by highway authorities or their
     contractors                                      178      6         167
48 involving farm workers or farm
     implements                                       28      14          12
49 involving aircraft or unmanned
     balloons
50 by private individuals (excl 49 and 56)           246      43        179                15
53 by unknown third parties                          443      22        414                 5
54 by local building authorities or
     contractors                                      109                104

                                              219
                                                                               Yorkshire
                                                       0/H     Power     Sw/Gr
                                             Total     lines   cables   Fuse/Gr Others
55     by private developers or their
       contractors                               358     11      336        1        10
56     involving leisure pursuits                  1      1       —        —         —
57     by other third parties                     57      9       47       —          1
  Total third party                          2,320      137    2,068       31        84
60 Ace contact; boards or contractors
   (inc live line)                               65       6       57        1         1
61 Switching error by A B personnel              —       —        —        —         —
62 Testing or commissioning error by
   A B personnel                                   1                                   1
63 Incorrect records, labelling or
   identification                                 11       1       8         1         1
65 Incorrect application of board's
   equipment                                       8               5        3
66 Faulty installation or
   construction                                  917     37      719       92        69
67 Load current above previous
   assessment                                    149      2       19      106        22
68 Incorrect protection settings
   of fuse rating                                 12               1        11
69 Unsuitable protection characteristics           2              —          2       —
                                                         —
70 Inadequate rupturing or short
   circuit capacity                                1              —          1       —
                                                         —
71 Deterioration due to ageing wear
   (excl corrosion)                          2,540      300      852      260      1,128
72 Fault on A B equipment faulting
   adjacent equipment                              5     —         4       —          1
73 Unsuitable parallelling conditions              1     —        —         1        —
75 Operational or safety restriction              22      4       11        6         1
77 Inadequate or faulty maintenance                7      1       —         6        —
87 Local generation failure
   (isolated system)                              —      —        —        —         —
     Total area boards                       3,741      351     1,676     490      1,224

88 A B equipment affected by
   generating board
90 Faulty manufacturing design
   assembly or materials                          12     —          5        6         1
98 Causes unclassified                            20      3         7        1         9
99 Cause unknown                             2,265      150     1,947      102        66

     Total unclassified, unknown             2,285      153     1,954      103        75

  Source: ESI National Fault Statistics.




                                           220
                                     APPENDIX 8.1
                      (referred to in paragraphs 8.16 and 8.23)
                    Schedule of Management Information
                             (as provided by YEB)

Note:
'General Distribution' in Section B of the schedule means that the data is
circulated normally with a covering letter to:
     Chairman
                                for information
     Deputy Chairman
     Chief Engineer
     Chief Commercial Officer
     Chief Accountant
     Secretary
     Area Managers
     Management Services Officer
     Registry

For the other cases under Section B the data is usually received in its original
format—often computer produced.

Management Information
A. Items Presented at Board Meetings and the Chairman's Conference
1. SECRETARIAL
                                               Board                   Chairman's Conference
Number of Employees (S 1)                      Quarterly               Quarterly
Stock Levels Compared to Targets in
Operating Plan (S2(a))                         Quarterly               Quarterly
Board Summary of Stock Statistics by Primary
Classes (S2(b))                                                        Quarterly
Meter Disputes Referred to Secretary of State
for Energy (S3)                                 Six monthly            Six monthly
Quarterly Analysis of Customers' Complaints
(S4(a))                                         Quarterly              Quarterly
Cumulative Analysis of Customers'
Complaints (S4(b))                             Three times each year   Three times each year
Substation Sites and Wayleaves (S5)             Annually               Annually
Disabled Persons (S6)                           Annually               Annually
Employees' Suggestion Scheme (S7)              Annually                Annually
Energy Conservation (S8)                        Annually               Annually
Board Plan                                      Annually
Secretarial Annual Review                       Annually
Manpower Plan                                   Annually
                                            221
                                                 , Board               Chairman's Conference
2. COMMERCIAL
Electricity Purchased (Cl)                      i£ Monthly             Monthly
 Growth in Units Purchased—Graph                   Monthly             Monthly
 Electricity Purchased—Graph                    ., Monthly             Monthly
Electricity Sold (C2)                           !! Quarterly           Quarterly
Sales of Appliances (C3)                        •* Monthly             Monthly
Cookers and Immersion Heaters (C4)              it
  (a) Number Installed in New Dwellings         !< Six monthly         Quarterly
  (b) Summary of Pro portion of New
      Dwellings with Cookers and Immersion
      Heaters                                   e Six monthly          Quarterly
Electricity Purchased and Units
Billed—Monthly Tariffs (C5)                          Monthly            Monthly
Bulk Supply Tariff                                   Annually
Commercial Annual Review                          », Annually
Publicity Expenditure                                Annually
Tariffs                                          ,, Annually—but may be
                                                     more frequent
Load Forecasts                                  f Annually
Rechargeable rates on Appliance Repairs              Annually
Domestic Appliance Maintenance Scheme and
'Carefree' rates                                     Annually

3. ENGINEERING
Electricity Purchased and Allocation to Areas
                                                                       Annually
Quarterly Distribution System Maintenance
Progress (AE2)                                       Quarterly         Quarterly
Distribution System Maintenance Wood            ,:
Poles—Testing and Replacement Progress
(AE3)                                            -                     Quarterly
Progress in Mains Records Conversion (AE4)       —                     Quarterly
Progress in Improving LV Network Earthing
(AE5)                                            t Quarterly           Quarterly
Standard System Phasing Progress (AE6)          •' Annually            Quarterly
Switchgear Improvements Progress (AE7)             Annually            Annually
Summary of Reconstruction and Improvement       £
of O/H Lines (AE9)                              * Six monthly          Six monthly
Mains Commissioned and Disconnected
(AE10)                                             Annually            Annually
Sub-stations Commissioned (AEI 1)                  Annually            Annually
Transport (AEI 2)                               •[ Six monthly         Six monthly
Fault Performance (AEI 3)                       -'Annually             Annually
Telecommunications Plant Maintenance
(AEI 5)                                          Quarterly             Quarterly
Safety Performance (AE 1 6)                      Annually              Quarterly
Engineering Annual Review                        Annually
Capital Expenditure Schemes Submitted for
Approval                                             Monthly
Summary of Capital Authorisations
(£50,000-£200,000 : Individual Schemes)              Monthly

4. ACCOUNTANCY
Capital Expenditure (A2)
  (a) Expenditure to Date Compared with
      Budget                                  Quarterly                Quarterly
  (b) Final Costs of Completed Capital
      Schemes                                 Six monthly              Six monthly
Summary of Capital Authorisations (Value)     Monthly
Summary of Capital Authorisations (Number
and Value)                                  rf Six monthly
Revenue Expenditure (A3)
  (a) Operating Costs in Relation to Target " Quarterly                Quarterly
  (b) Training Costs in Relation to Target  0
                                              Six monthly              Six monthly
  (c) Transport Costs                         Six monthly              Six monthly
                                                222
                                                 Board                     Chairman's Conference
Contracting and Sales of Appliances and
Appliance Servicing (A4)                         Six monthly               Quarterly
Manpower and Productivity (A5)
  (a) Non-Industrial                             Six monthly               Six monthly
  (b) (i) Industrial Hours and Earnings          Six monthly               Six monthly
        (ii) Industrial Numbers Employed         Six monthly               Six monthly
       (iii) Industrial Performance Data         Six monthly               Six monthly
  (c) (i) Industrial Sickness Data               Six monthly               Six monthly
        (ii) Non-Industrial Sickness Data        Six monthly               Six monthly
Canteen (A6)                                     Annually                  Annually
Billing and Collection (AT)
  (a) Ratio of Debtors to Related Turnover       Annually                  Annually
  (b) Quarterly Energy Accounts—Final
       Accounts and Bad Debts                    Annually                  Annually
  (c) Monthly and Miscellaneous
       Accounts—Collection Data                  Annually                  Annually
  (d) Meter Reading Billing and Collection
       (Miscellaneous Indicators)                Annually                  Annually
  (e) Meter Reading (Incidence of Meter
       Readings etc)                             Annually                  Annually
  (/) Rights of Entry (Gas and Electricity
       Boards) Act 1954                          Annually                  Annually
  (g) Prepayment Meters Broken Open              Annually                  Annually
  (h) General Statistics                         Annually                  Annually
  (i) Sundry Debtors Accounts                    Six monthly               Six monthly
  (/) Extended Credit Sales                      Six monthly               Six monthly
  (Jt) Large Power Monthly Billed Accounts       Quarterly                 Quarterly
  (/) Quarterly Credit Debts—Analysis by
       Type                                      Six monthly               Six monthly
Industrial Staff Overtime Hours as a % of
Hours Worked (A8)                                Annually                  Annually
Accountancy Annual Review                        Annually
Capital Expenditure Budgets (Current Year
Plus Five Years)                                 Annually
Capital Expenditure Programme (Secretary of
State's Approval)                                Annually                  —
Report and Accounts                              Annually                  —
Revenue Estimates                                Annually—but may be       —
                                                 more frequent
Accounts for the Year—Area Analysis              —                         Annually
Comparison of the Results of All Area Boards     Annually                  Annually
Financial Statistics                             Annually circulated for   —
                                                 information




B. Other Data

                                           Frequency        Recipient

1. MANPO WER, SALARIES AND PRODUCTIVITY
1.1 Non-Industrial Salaries
Details of Salaries (NIS 1)                Quarterly        Assistant Chief
                                                            Accountant—Financial and
                                                            Management Accounting (FAMA),
                                                            Area Accountant
Cost Centre Analysis of Salaries (NIS 2)   Monthly          Deputy Chief Officers, Area Senior
                                                            Officers
Area Summary by Function (NIS 3)           Monthly          Area Accountants, Assistant Chief
                                                            Accountant—FAMA
YEB Summary (NIS 4)                        Quarterly        General Distribution
Summary by Negotiating Body (NIS 5)        Monthly          Assistant Chief Accountant—FAMA
                                               223'
                                           Frequency       Recipient
1.2 Industrial Salaries
Summary of Hours and Earnings (ISS 1)      Monthly         Cost Centre Supervisors
Staff with an average of more than five
hours overtime per week (ISS 1 A)          Monthly         Cost Centre Supervisors
Details of Salaries (ISS IB)               Quarterly       Assistant Chief Accountant—FAMA,
                                                           Area Accountant
Area Summary of Hours and Earnings
(ISS 2)                                    Monthly         Deputy Chief Officers, Area •
                                                           Managers, Area Senior Officers
YEB Summary of Hours and Earnings
(ISS 3)                                    Monthly         Chief Officers, Area Managers,
                                                           Assistant Chief Accountant—FAMA
1.3 Manpower
Non-Industrial (Analysis over months)      Monthly         Chairman, Deputy Chairman, Chief
                                                           Accountant, Secretary, Deputy Chief
                                                           Accountant, Assistant Chief
                                                           Accountant—FAMA
Industrial (Analysis over months)          Monthly         Chairman, Deputy Chairman, Chief
                                                           Accountant, Secretary, Deputy Chief
                                                           Accountant, Assistant Chief
                                                        "* Accountant—FAMA
1.4 Miscellaneous
Sickness Absence Data                      Quarterly       Area Managers, Head Office
                                                           Personnel
Sickness Statistics and Indicators         Quarterly       Chief Officers, Area Managers,
                                                           Assistant Chief Accountant—FAMA
Industrial Staff Overtime                  Monthly         Chief Officers, Area Managers,
                                                           Assistant Chief Accountant—FAMA
Labour Turnover, Industrial Staff          Monthly         Area Managers, Head Office
                                                           Personnel
1.5 Labour Cost Control
Cost Centre Return (MC 1)                  Monthly         Cost Centre Supervisors
Area Summary Return (MC 2)                 Monthly         Area Managers, Area Senior Officers
Board Summary Return (MC 3)                Quarterly       General Distribution
1.6 Training
Report on Education and Training           Annually        General Distribution
1.7 Clerical Work Measurement
Control Data                               Monthly         Section Supervisors


2. REVENUE AND CAPITAL               EXPENDITURE
2.1 Revenue
Revenue Estimates                          Updated as      Chairman, Deputy Chairman, Chief,.
                                           necessary       Commercial Officer, Chief
                                                           Accountant, Deputy Chief
                                                           Accountant, Assistant Chief
                                                           Accountant—FAMA
Monthly Financial Statement                Monthly         Chairman, Deputy Chairman, Chief
                                                           Engineer, Chief Commercial Officer,
                                                           Chief Accountant, Assistant Chief
                                                           Accountant—FAMA
Operating Costs in Relation to Target      Monthly         Chief Officers, Area Managers
Cost Centre Statements (MIS 1)             Monthly         Cost Centre Supervisors
Area Summary of Expenditure (MIS 2)        Monthly         Assistant Chief Accountant—FAMA,
                                                           Area Managers, Area Senior Officers
YEB Summary of Expenditure (MIS 3)         Monthly         Assistant Chief Accountant—FAMA
Area Source Analysis (MIS 4)               Monthly         Assistant Chief Accountant—FAMA,
                                                           Area Managers, Area Senior Officers
                                             224
                                          Frequency      Recipient
YEB Source Analysis (MIS 5)               Monthly        Assistant Chief Accountant—FAMA
Publicity (PCS 1 (Parts 1, 2 and 3))      Monthly        Assistant Chief Commercial
                                                         Officer—Marketing
Training (PCS 2 and Supplement) Area
Summary                                   Quarterly      Area Secretaries
Training YEB Summary                      Quarterly      Secretary
Training YEB Summary (Supplement)         Quarterly      Chief Officers, Area Managers
Stores Handling (PCS 3)                   Monthly        Area Secretaries
Repair and Maintenance of Buildings
(PCS 4)                                   Quarterly      Senior Officer Responsible for
                                                         Maintenance of Buildings
Management Services Unit (PCS 5)          Monthly        Management Services Officer
Transport and Mobile Plant Return
(TPT1)
Part 1 Individual Area Statements         Six monthly    Chief Engineer, Area Managers, Area
                                                         Engineers
       YEB Consolidated Statement         Six monthly    Chief Engineer, Chief Accountant
Part 2                                    Annual         Chief Engineer
Transport and Mobile Plant Return
(TPT2)                                    Six monthly    Transport Officers
YEB Transport Cost Ratios                 Six monthly    Chief Officers, Area Managers


2.2 Capital
Outstanding Capital Schemes               Annually       General Distribution
Expenditure to Date Compared with
Budget                                    Monthly        Chief Officers, Area Managers
Final Costs of Completed Capital Scheme   Six monthly    Chief Officers, Area Managers
Capital Authorisation                     Monthly        Appropriate Level of Authority
Budget Category Analysis                  Monthly        Senior Executive Officer—FAMA
                                                         Senior Executive
                                                         Officers—Expenditure
Project Follow-Up—Summary                 Monthly        Senior Executive Officer—FAMA
                                                         Senior Executive
                                                         Officers—Expenditure
Financial Account Analysis                Monthly        Senior Executive Officer—FAMA
                                                         Senior Executive
                                                         Officers—Expenditure
Accepted Project Analysis                 Monthly        Senior Executive Officer—FAMA
                                                         Senior Executive
                                                         Officers—Expenditure
Investment Review                         Monthly        Controlling Officer
Early Warning Statement                   By exception   Controlling Officer
Completion Schedule on Closed Jobs        Monthly        Controlling Officer/Authorising
                                                         Officer
CAP 2 Forms—Data                          On process     Controlling Officer
                                          of closure
                                          notice
Summary of Revised Final Costs and Late
Costs                                   On process       Senior Executive
                                        of late          Officers—Expenditure, Controlling
                                        costs            Officer

2.3 Miscellaneous
Meter Reading Billing and Collection
Costs                                     Six monthly    General Distribution.
Repair and Maintenance of Meters, Head
Office Costs                              Quarterly      Assistant Chief Engineer—Technical
Area Costs                                Annually       Assistant Chief Engineer—Technical
Analysis of Computer Costs                Monthly        Chief Accountant, Assistant Chief
                                                         Accountant—Computer Services
Printing Section—Trading Statement        Quarterly      Chief Commercial Officer
Costing Indicators (Unbilled Jobs:
Unmatched Items: Dummy Jobs)              Quarterly      General Distribution
Canteen Costs                             Quarterly      General Distribution

                                            225
                                          Frequency   Recipient
2.4 Costing Operational Statements
COS 1 Capital Assets—Transfer and
       WnteOff                            Annually    Senior Executive Officer, FAMA
COS2 Rechargeable Jobs—Delayed                                  \
        Billing                           Monthly     Senior Executive
                                                      Officers—Expenditure
COS3    Rechargeable Jobs—Completed
        Job Details                       Weekly      Senior Executive
                                                      Officers—Expenditure
COS5 Special Jobs—Closed Job
     Summaries                            Weekly      Senior Executive
                                                      Officers—Expenditure
COS6 Special Jobs—Summary of Costs
     for Specified Jobs            Monthly            Senior Executive
                                                      Officers—Expenditure
COS? Special Jobs—Total Costs for a
     Financial Year for Permanent
     Jobs                                 Annually    Senior Executive
                                                      Officers—Expenditure
COS8 Special Jobs—Total Costs at a           rf
     Financial Year End for
     Temporary Jobs                       Annually    Senior Executive
                                                      Officers—Expenditure
COS 15 Rechargeable Jobs—List of Jobs
       Unmoved for Two Months             Monthly     Senior Executive
                                            js        Officers—Expenditure
COS 16 List of Vehicles Scrapped During
       a Financial Year                   Annually    Senior Executive
                                                      Officers—Expenditure
COS 17 Rechargeable Jobs—Work in
       Progress for Jobs Over £100        Monthly     Senior Executive
                                                      Officers—Expenditure
COS18 Vehicle Running Costs by Year
      of Purchase                         Annually    Senior Executive
                                                      Officers—Expenditure
COS19 Vehicle Costs for the Year to
      Date by User Cost Centre            Monthly     Senior Executive
                                                      Officers—Expenditure
COS20 Vehicle Depreciation Statement      Annually    Senior Executive
                                                      Officers—Expenditure



3. CONTRACTING AND SALES OF APPLIANCES (INCLUDING                 MARKETING)
District Trading Statement (CSA 3)        Monthly     Senior Commercial Engineer/District
                                            rl        Commercial Engineer, Senior
                                                      Executive Officers—Expenditure
Area Gross Profit
Summary—Contracting (CSA 4)               Monthly     Area Managers, Area Senior Officers,
                                                      Senior Commercial Engineers, Senior
                                                      Executive Officers—Expenditure
Area Gross Profit Summary—Sales of
Appliances (CSA 5)                        Monthly     Area Managers, Area Senior Officers,
                                                      Marketing Controllers, Senior
                                                      Executive Officers—Expenditure
Area Trading Statement—Contracting
(CSA 6)                                   Monthly     Area Managers, Area Senior Officers,
                                                      Senior Commercial Engineers, Senior
                                                      Executive Officers—Expenditure
Area Trading Statement—Sales of
Appliances (CSA 7)                        Monthly     Area Managers, Area Officers,
                                                      Marketing Controllers, Senior
                                                      Executive Officers—Expenditure
Shop Gross Profit Statement (CSA 9)       Monthly     Area Managers, Area Senior Officers,
                                                      Marketing Controllers, Senior
                                                      Executive Officers—Expenditure
                                            226
                                         Frequency     Recipient
YEB Gross Profit
Summary—Contracting (CSA 10)             Monthly       Assistant Chief Accountant—FAMA,
                                                       Assistant Chief Commercial
                                                       Officer—Customer Operations, Area
                                                       Managers
YEB Gross Profit Summary—Sales of
Appliances (CSA 11)                      Monthly       Assistant Chief Accountant—FAMA,
                                                       Assistant Chief Commercial
                                                       Officer—Marketing, Area Managers
YEB Trading Statement—Contracting
(CSA 12)                                 Monthly       Assistant Chief Accountant—FAMA,
                                                       Assistant Chief Commercial
                                                       Officer—Customer Operations, Area
                                                       Managers
YEB Trading Statement—Sales of
Appliances (CSA 13)                                    Assistant Chief Accountant—FAMA,
                                                       Assistant Chief Commercial
                                                       Officer—Marketing, Area Managers
YEB Trading Statement—Combined
(CSA 14)                                               Assistant Chief Accountant—FAMA,
                                                       Assistant Chief Commercial
                                                       Officer—Marketing, Assistant Chief
                                                       Commercial Officer—Customer
                                                       Operations, Area Managers
Bad Debt Analysis                        Annually      General Distribution
Quick Service Sales                      Six monthly   General Distribution
Shop Sales by Product Group and
Product Sub-Group (MKG 1 and 1 A)        Weekly        Assistant Chief Commercial
                                                       Officer—Marketing, Marketing
                                                       Controllers
YEB Summary of Sales Turnover by
Product Group (MKG 2 and 3)              Weekly        Assistant Chief Commercial
                                                       Officer—Marketing, Area Managers,
                                                       Marketing Controllers
YEB Summary of Appliance Sales by
Make and Model (MKG 4)                   Weekly        Assistant Chief Commercial
                                             u         Officer—Marketing Managers, Area
                                                       Marketing Controllers
Analysis of Sales by the Major Product
Groups (MKG 5)                           Monthly       Assistant Chief Commercial
                                                       Officer—Marketing
                                                       Area Managers, Marketing
                                                       Controllers
Manufacturers' Shares of Product Groups     n
(MKG6A-6G)                              Monthly        Assistant Chief Commercial
                                                       Officer—Marketing
Manufacturers' Shares of the Total
Appliances and Accessories Sold by the
Shop and YEB (MKG 7)                                   Assistant Chief Commercial
                                                       Officer—Marketing
Analysis of Methods of Payment for all
Appliances and Accessories Sold (MKG
8)                                       Monthly       Assistant Chief Commercial
                                                       Officer—Marketing
Analysis of Payment Method by Product
Group (MKG 9A-9H)                        Monthly       Assistant Chief Commercial
                                                       Officer—Marketing
Sales of Appliances and Accessories by
Individual Sales Employee (MKG 10)       Quarterly     Assistant Chief Commercial
                                                       Officer—Marketing, Marketing
                                                       Controllers
Appliance Stock Availability and Sales by
Make and Model (MKG 20)                   Twice weekly Marketing Controllers, Senior
                                                       Executive Officers—Supplies and
                                                       Stores
                                           227
                                        Frequency   Recipient
YEB Holdings of Standard Selling Stocks
(MKG31)                                 Weekly      Assistant Chief Commercial
                                                    Officer—Marketing Assistant
                                                    Secretary—Supplies and Stores,
                                                    Marketing Controllers
Area Holdings of Non-Standard Selling
Stock (MKG 32-32A)                       Monthly    Marketing Controllers, Senior
                                                    Executive Officers—Supplies and
                                                    Stores
YEB Holdings of Non-Standard Selling
Stock (MKG 33)                           Monthly    Assistant Chief Commercial
                                                    Officer—Marketing
Seasonal Campaign Analysis by Shop         __
(MKG 40)                               On request   Marketing Controller
Seasonal Campaign Analysis by Area and
YEB (MKG 41)                           On request   Assistant Chief Commercial
                                                    Officer—Marketing, Area
                                                    Commercial Officers, Marketing
                                                    Controllers
Sales of Storage Radiators—Package
Sizes (MKG 44)                           Weekly     Assistant Chief Commercial
                                                    Officer—Marketing
Storage Radiator Campaign
Analysis—Package Sizes (MKG 45)          Weekly     Assistant Chief Commercial
                                                    Officer—Marketing
Appliance Sales by Product Marketing     Monthly    Assistant Chief Commercial
                                                    Officer—Marketing, Controllers
Contracting Monthly Report               Monthly    Chief Commercial Officer, Deputy
                                                    Chief Commercial Officer, Assistant
                                                    Chief Commercial Officers, Area
                                                    Commercial Officers
Market Planning Figures                  Monthly    Assistant Chief Commercial
                                                    Officer—Marketing, Marketing
                                                    Controllers
Order of Shops by Turnover               Monthly    Assistant Chief Commercial
                                                    Officer—Marketing, Marketing
                                                    Controllers



3.2 Appliance Servicing
District Trading Statement (APPREP 1
(Part 1))                                Monthly    District Commercial Engineer/Senior
                                                    Commercial Engineers, Senior
                                                    Executive Officers—Expenditure
Analysis of Indirect Costs (APPREP 2
(Part 2))                                Monthly    District Commercial Engineers/Senior
                                                    Commercial Engineers, Senior
                                                    Executive Officers—Expenditure
Area Income Summary (APPREP 2 (1))       Monthly    Area Managers, Area Senior Officers,
                                                    Senior Commercial Engineers, Senior
                                                    Executive Officers—Expenditure
Area Gross Profit Summary (APPREP 2
(2))                                     Monthly    Area Managers, Area Senior Officers,
                                                    Senior Commercial Engineers, Senior
                                                    Executive Officers—Expenditure
Area Gross Profit Statistics (APPREP 2
(3))                                     Monthly    Area Managers, Area Senior Officers,
                                                    Senior Commercial Engineers, Senior
                                                    Executive Officers—Expenditure
Area Trading Summary (APPREP 4 (1))      Monthly    Area Managers, Area Senior Officers,
                                                    Senior Commercial Engineers, Senior
                                                    Executive Officers—Expenditure
YEB Income Summary (APPREP 3(1))         Monthly    Assistant Chief Accountant—FAMA,
                                                    Assistant Chief Commercial
                                                    Officers—Customer Operations, Area
                                                    Managers
                                           228
                                         Frequency     Recipient
YEB Summary Gross Profit Statistics
(APPREP 3(3))                            Monthly       Assistant Chief Accountant—FAMA,
                                                       Assistant Chief Commercial
                                                       Officer—Customer Operations, Area
                                                       Managers
YEB Trading Summary (APPREP 5(1))        Monthly       Assistant Chief Accountant—FAMA,
                                                       Assistant Chief Commercial
                                                       Officer—Customer Operations, Area
                                                       Managers
YEB Trading Summary—Statistics
(APPREP 5 (2))                           Monthly       Assistant Chief Accountant—FAMA,
                                                       Assistant Chief Commercial
                                                       Officer—Customer Operations, Area
                                                       Managers




4.1 Purchasing, Stores and Creditors
Summary of Stocktaking Adjustments
(STR4)                                Monthly          General Distribution
YEB Summary of Stocktaking Adjustments
(STR 6)                                Six monthly     General Distribution
YEB Summary of Stock Values (STR 11) Monthly           Assistant Secretary—Supplies and
                                                       Stores
YEB Summary of Number of Weeks Stock
in Hand—by Units (STR 12)            Monthly           Assistant Secretary—Supplies and
                                                       Stores
YEB Summary of Number of Weeks Stock
in Hand—by Value (CS888PO1)          Weekly            Assistant Secretary—Supplies and
                                                       Stores
Area Summary of Stock Holdings (STR 13) Monthly        Senior Executive Officers—Supplies
                                                       and Stores
Area Summary of Stock Values and the
Number of Weeks Stock in Hand by Store
(STR 14)                               Monthly         Senior Executive Officers—Supplies
                                                       and Stores
Stock Values and Number of Weeks Stock
in Hand for Individual Commodities within
Areas (STR 15)                            On request   Senior Executive Officers—Supplies
                                                       and Stores
Stock Values and Number of Weeks Stock
in Hand for Commodities Held at
Individual Stores (STR 16)             On request      Senior Executive Officers—Supplies
                                                       and Stores
General Stock Control and Usage Print
(STR 17)                                 On request    Senior Executive Officers—Supplies
                                                       and Stores
Slow Moving Stock Return (STR 19)        Quarterly     Senior Executive Officers—Supplies
                                                       and Stores
YEB Slow Moving Stock Return (STR 20) Quarterly        Assistant Secretary—Supplies and
                                                       Stores
Stores Turnover (STR 21)                 Quarterly     Senior Executive Officers—Supplies
                                                       and Stores
Stores Forecasting Check List (STR 28)   Weekly        Senior Executive Officers—Supplies
                                                       and Stores
Stock Re-order Print (STR 29)            Weekly        Senior Executive Officers—Supplies
                                                       and Stores
Appliance Spares Imprest Stock Usage
(STR 37)                                 Quarterly     Senior Commercial Engineers
List of Commodities in Store (STR 38)    Quarterly     Senior Executive Officers—Supplies
                                                       and Stores
Appliance Spares (CASS) Issues of
Commodities Not Stocked in Area Store
(STR 39)                                  Quarterly    Senior Commercial Engineers
Turnover by Stock Classification (STR 99) Monthly      Assistant Secretary—Supplies and
                                                       Stores
                                           229
                                            Frequency      Recipient
Bulk Purchase Contracts and Fixed Price
Contracts (CPP 43)                          By exception   Assistant Chief
                                                           Accountant—Centralised Accounting.
                                                           Senior Executive Officers—Supplies
                                                           and Stores
Shop Domestic Appliance Stockholdings
(CS888PO2)               j                  Monthly        Assistant Secretary—Supplies and
                                                           Stores
Pareto Analysis (CS888 )26)        '        On request     Assistant Secretary—Supplies and
                                                           Stores
Combined Invoice/Diary Sheets—Analysis Monthly             General Distribution
Official Order File—Rejections etc.    Quarterly           General Distribution



5. CUSTOMER ACCOUNTING
5.1 Quarterly Credit and Prepayment
5.1.1 Meter Reading
Meter Reading by District                   Quarterly      General Distribution
Meter Reading (Incidence of Meter
Reading etc)                                Six monthly    General Distribution
Prepayment Meters Broken Open               Six monthly    General Distribution
5.1.2 Billing        ,
Hand Delivery                               Quarterly      General Distribution
Amended and Reissued Accounts               Monthly        Chief Accountant, Deputy Chief
                                                           Accountant
5.7.3 Collection
5.1.3.1 Collection Performance Booklet       Quarterly     General Distribution
 1. Ratio of Debtors to
     Turnover—Quarter End
 2. Ratio of Debtors to Turnover—Five
     Year Graph
 3. Age of Debt Analysis
 4. Number of Normal Accounts
     Outstanding per 1,000 normal
     Customers
 5. Number of Final Accounts
     Outstanding for More than Six Months
     as a Percentage of Total Final Accounts
     Outstanding
 6. YEB Statement of Area Collection
     Performance
 7. Individual Area Statement of
     Collection Performance
 8. Welfare Debts—Average Debt Per
     Customer—All Areas
 9. Quarterly Accounts on Computer
     Files—Board Summary—produced
     Annually in March
10. Individual Area Graph—Customers
     Who Pay Before Reminder/Notice
11. Individual Area Graph—Customers
     Who Pay Before Recorded Delivery
     Letter
12. Individual Area Graph—Customers
     Who Pay Before First Disconnection
     Order
13. Area Analysis of Customers Who Pay
     Before Reminder/Notice, Recorded
     delivery, or Disconnection Order
14. Number of Disputes Outstanding Over
     Three Months Old
                                               230
                                         Frequency     Recipient
5.1.3.2 Miscellaneous
Age of Debt Summary                      Quarterly     General Distribution
Follow Up Statistics                     Daily         Assistant Chief
                                                       Accountant—Customer Accounting,
                                                       Senior Executive Officers—Income
Debit Balances Outstanding at the
Preparation of Meter Reading Sheets—
Details                                  Daily         Senior Executive Officers—Income
Debit Balances Outstanding at the
Preparation of Meter Reading Sheet—
Summary                                  Ad Hoc        General Distribution
Customers Disconnected for Non-Payment
of Account for more than One Month       Quarterly     Area Accountants
Rights of Entry (Gas and Electricity
Boards) Act 1954                         Six monthly   General Distribution
Analysis of Budget Plan Customers by
Method of Payment                        Monthly       Assistant Chief Accountant-
                                                       Customer Accounting, Senior
                                                       Executive Officers—Income
Ratio of Debtors to Related Turnover     Quarterly     General Distribution
5.1.4 General
Analysis of Prepayment Meters by Type of
Coin Mechanism                           Monthly       Assistant Chief Accountant—
                                                       Customer Accounting, Senior
                                                       Executive Officers—Income
Analysis of Customers by Status          Monthly       Assistant Chief Accountant—
                                                       Customer Accounting, Senior
                                                       Executive Officers—Income
Analysis of Customers by Collection
Method                                   Monthly       Assistant Chief Accountant—
                                                       Customer Accounting, Senior
                                                       Executive Officers—Income
Analysis of Customers by Payer Status    Monthly       Assistant Chief Accountant—
                                                       Customer Accounting, Senior
                                                       Executive Officers—Income
Number of Customers Subject to Selected
Miscellaneous Conditions                Monthly        Assistant Chief Accountant—
                                                       Customer Accounting, Senior
                                                       Executive Officers—Income
Customers Subject to Non-Standard
Follow-up                                Quarterly     Assistant Chief Accountant—
                                                       Customer Accounting, Senior
                                                       Executive Officers—Income

5.2 Monthly Credit
Meter Reading by District                Quarterly     General Distribution
Ratio of Debtors to Turnover             Quarterly     General Distribution
Monthly Energy and Miscellaneous
Accounts Collection Data                 Annually      General Distribution
Debts Outstanding—Age Analysis           Monthly       General Distribution

5.3 Extended Credit Sales
Extended Credit Sale Agreements          Quarterly     General Distribution
Control Statistics (ECS 18)              Monthly       Assistant Chief Accountant—
                                                       Customer Accounting, Senior
                                                       Executive Officers—Income
Summary of Agreements—Collection
Reports Issued and No Payment Received
for Two Months (ECS 21)                Monthly         Assistant Chief Accountant—
                                                       Customer Accounting, Senior
                                                       Executive Officers—Income
Analysis of Age and Action Taken on
Outstanding Collection Reports (ECS 22) Monthly        Assistant Chief Accountant—
                                                       Customer Accounting, Senior
                                                       Executive Officers—Income

                                           231
       r                                  Frequency       Recipient
Cash Processed Against Collection Reports
(ECS 23)                                  Monthly         Assistant Chief Accountant—
                                                          Customer Accounting, Senior
                                                          Executive Officers—Income
5.4 Sundry Debtors Accounts
Debts Outstanding                             Quarterly   General Distribution
Detailed Summary of Outstanding
Amounts—Age                                   Monthly     Chief Commercial Officer, Area
                                                          Managers
Analysis of New Debt                          Weekly      Assistant Chief Accountant—
                                                          Customer Accounting, Senior
                                                          Executive Officers—Income
Analysis of Outstanding Debt                  Weekly      Assistant Chief Accountant—
                                                          Customer Accounting, Senior
                                                          Executive Officers—Income
Ratio of Debtors to Turnover                  Quarterly   General Distribution


6. SALES OF ELECTRICITY
Customer Classification of Electricity Billed
(Table Al)                                    Quarterly   Assistant Chief Accountant—FAMA,
                                                          Assistant Chief Commercial Officer—
                                                          Tariffs & Economics, Senior Executive
                                                          Officers—Expenditure
Electricity Billed to Industrial Consumers
(Table A2)                                 Monthly        Assistant Chief Accountant—FAMA,
                                                          Assistant Chief Commercial
                                                          Officer—Tariffs & Economics, Senior
                                                          Executive Officers—Expenditure
Tariff Classification of Electricity Billed
(Table A3                                     Monthly     Assistant Chief Accountant—FAMA,
                                                          Senior Executive
                                                          Officers—Expenditure
Quarterly Analysis of Billed Units and
Revenue                                       Quarterly   Assistant Chief Commercial Officer—
                                                          Tariffs & Economics
Monthly Analysis of Billed Units and
Revenue                                       Monthly     Assistant Chief Commercial Officer—
                                                          Tariffs & Economics
Quarterly Credit Billing Statistics           Quarterly   Assistant Chief Accountant—FAMA,
                                                          Senior Executive Officers—
                                                          Expenditure
Quarterly Credit Commercial Statistics        Quarterly   Assistant Chief Accountant—FAMA,
                                                          Assistant Chief Commercial Officer— .
                                                          Tariffs & Economics, Senior Executive
                                                          Officers—Expenditure
Monthly Accounts Premises Summary             Monthly     Assistant Chief Accountant—FAMA,
                                                          Assistant Chief Commercial Officer—
                                                          Tariffs & Economics, Senior Executive
                                                          Officers—Expenditure
Monthly Accounts Premises—Twelve
Month Summary                                 Annually    Assistant Chief Accountant—FAMA,
                                                          Assistant Chief Commercial Officer—
                                                          Tariffs & Economics, Senior Executive
                                                          Officers—Expenditure
Monthly Accounts Tariff Analysis              Annually    Tariffs and Economics
Monthly Accounts Premises Analysis            Annually    Tariffs and Economics
Percentage Change in Units Billed             Monthly     Chairman, Deputy Chairman, Chief
                                                          Commercial Officer, Chief
                                                          Accountant, Assistant Chief
                                                          Commercial Officer—Tariffs &
                                                          Economics
Units Purchased and Billed—% Change
Over Corresponding Period of Previous
Year                                          Quarterly   Chief Officers, Area Managers
                                                232
                                           Frequency     Recipient
Industrial Energy Sales                    Quarterly    Assistant Chief Commercial
                                                        Officer—Tariffs & Economics, Senior
                                                        Industrial Sales and Terms Engineers
Monthly Billed Management Information Monthly           Assistant Chief Commercial
                                                        Officer—Tariffs & Economics
Analysis of Customers by Consumption Per
Tariff       .                           Quarterly      Assistant Chief Commercial Officer—
                                                        Tariffs & Economics
Number of Customers                        Quarterly    General Distribution
Pocket Statistics                          Quarterly    General Distribution
Analysis of Domestic and Commercial
Energy Sales by Salesman                   Monthly      Area Managers
Analysis of Industrial Sales by Salesman   Monthly      Area Managers

7. ENGINEERING DATA
7.1 Primary System Construction
    Programme                              Quarterly    Chief Officers, Area Managers
7.2 Overhead Line Maintenance
Progress of Inspection (OHL SI)            Monthly      Chief Engineer, Area Engineers,
                                                        District Engineers
Information for Table El (OHL S2)          Monthly      Chief Engineer, Area Engineers,
                                                        District Engineers
Information for Table E2 (OHL S3)          Monthly      Chief Engineer, Area Engineers,
                                                        District Engineers
Progress of Painting (OHL S4)              Monthly      Chief Engineer, Area Engineers,
                                                        District Engineers
District Forecast of Inspections Due in
Year (OHL 41-47,51)                       Annually      Area Engineers, District Engineers
District Forecast of Painting Due in Year
(OHL 40)                                  Annually      Area Engineers, District Engineers
District Forecast of Decayed Poles to
Retest in Year (OHL 49)                   Annually      Area Engineers, District Engineers
District Forecast of Tree Lopping Jobs in
Year (OHL 52)                             Annually      Area Engineers, District Engineers
Ten Year Forecast of Inspections (OHL 53) Annually      Area Engineers, District Engineers
7.3 National Fault and Interruption
Reporting Scheme
System and Equipment Performance           Annually     Chief Officers, Area Managers
Miscellaneous Information                  On request
7.4 Plant Maintenance
Quarterly Maintenance Schedule           Quarterly      Area Engineers, District Engineers
Maintenance Defect Report and Switchgear
Count                                    Six monthly    Area Engineers, District Engineers
Annual Maintenance Schedule              Annually       Area Engineers, District Engineers
Distribution Sub-station Future Work
Programme                                Quarterly      Area Engineers, District Engineers
Trip Test Schedule                       Quarterly      Area Engineers, District Engineers
Maintenance Performance                 Monthly         Area Engineers, District Engineers
Transformer Changes                      Monthly        Area Engineers, District Engineers

8. MISCELLANEOUS
Financial Statistics                       Annually     General Distribution
Review of Operating Plan including
Performance Indicators (Year Completed
and Ensuing Year)                          Annually     Chief Officers, Area Managers,
                                                        Management Services Officer
Accident Statistics                        Quarterly    Chief Officers, Area Managers
Meter Recertification Programme            Alternate    Chief Commercial Officer, Deputy
                                           Months       Chief Commercial Officer, Assistant
                                                        Chief Commercial Officers, Area
                                                        Commercial Officers

                                             233
                                     APPENDIX 9.1
                            (referred to in paragraph 9.5)

   YEB: Labour cost control systems—summary of management
                      control information

Frequency          Summary of Primary Indicators             Distribution
Monthly            By activity and cost centre:
Produced             —monthly performance/moving average     Engineer or
manually               performance                           Executive Officer
by districts         —overtime, waiting, diverted, other     responsible for
                       work(%)                               employees in the
                     —equivalent units per man-day           cost centre
                     —other indicators (access rates,
                       miles per job etc)
                   By activity and district:
                     —target performance                     Area senior
                     ^-current performance                   management
                     —Moving average performance
                   By activity and district:
                     —current performance                    TU Side Secretary

Quarterly          By activity and area:
                     —target performance                     Chief officers
                     —quarterly performance over 15 months   Area managers
                   By selected activities and area:
Produced             —target performance                     Chairman's
on PET               —quarterly performance over 15 months   Conference
microcomputer
atHQ
                   By activity for the Board:
                     —output units                           Electricity
                     —attendance hours                       Council

Bi-annually        By activities and district:
Produced             —current performance                    DJIC
manually             —moving average performance
atHQ

  Source:   YEB.




                                               234
                                              APPENDIX 9.2
                                (referred to in paragraphs 9.12 and 9.17)

                                    Electricity Supply Industry—G.B.

  Salary Scales and Related Payments (All Employees). Issued: November 1982

                  SALARY SCALES « pa)                                                   SALARY SCALES (I pa)
NJB—EflectTfe from :   1 February   1982                          NJB—Research Bands—Effecthre from:        1 February 1982
  Eng.1     3rd1         2nd          ht      Snr.     Prin.        Band 4    Band 3     Band 2             Band 1      Band 1 A
  Asst.    Engr.        Engr.       Engr.    Engr.    Engr.          6,046                                   13,386      15,132
                                                                               9,791     11,279
  6,046    7,044         9,500      11,279   13,386   16,086         6,223    10,083     11,597              13,822      15,606
  6,223    7,264         9,791      11,597   13,822   16,571         6,411    10,379     11,926              14,259      16,086
  6,411    7,484        10,083      11,926   14,259   17,061         6,615    10,675     12,254              14,695      16,571
  6,615    7,706        10,379      12,254   14,695   17,552         6,830    10,972     12,605              15,132      17,061
  6,830    7,927        10,675      12,605   15,132   18,047         7,044    11,279     12,955              15,606      17,552
  7,044    8,148        10,972      12,955   15,606   18,548         7,264    11,597     13,386              16,086      18,047
  7,264    8,374        11,279      13,386   16,086   19,055         7,484    11,926     13,822              16,571      18,548
  7,484    8,627        11,597      13,822   16,571                  7,706    12,254     14,259              17,061      19,055
  7,706 / 8,918         11,926      14,259   17,061                  7,927    12,605     14,695
  7,927 / 9,209         12,254      14,695                           8,148               15,132
  8,148 / 9,500         12,605      15,132                           8,374
  8,374    9,791                                                     8,627
  8,627   10,083                                                     8,918
  8,918   10,379                                                     9,209
  9,209   10,675                                                     9,500
  9,500                                                              9,791
                                                                    10,083
Plus responsibility payment: £292 pa, made to all NJB staff,        10,379
                             except                                 10,675
                             Scientific Assistants
                             Technical Staff Trainees             Plus responsibility payment: £292 pa
                             Graduate Trainees
  Note:   1. Includes Assistant Technical Officer
          2. Includes Technical Officer




                  SALARY SCALES (£ pa)                                                  SALARY SCALES (£ pa)
NJMC—Effectire from: 1 Aprfl 1982                                    NJC—Effective from : 1 May 1982
 Band    Band    Band     Band     Band         Band     Band        Schedules 'A' & «B' Staff— PAG Grades
   II     III     IV        V        VI          VII     VIII         PAG I* PAG 2 PAG 3 PAG 4 PAG 5 PAG 6*                  PACT*
 14,763* 17,399* 18,961* 20,562 . 21,628       22,704 23,780           6,985    7,663     8,577   9,829 11,424 13,542         15,526
 15,290t 17,926 19,508 21,090 22,166           23,242 24,318           7,211    7,889     8,809 10,109 11,801 14,038          16,026
 15,817 18,453 20,035 21,628 22,704            23,780 24,909           7,437    8,115     9,041 10,389 12,179 14,534          16,526
 16,344 18,981 20,562 (22,166) (23,242)       (24,318) (25,500)        7,663    8,345     9,274 10,675 12,599 15,030          17,026
 16,872 19,508 (21,090)                                                7,889    8,577     9,549 11,047 13,046 15,526          17,526
 17,399 20,035                                                         8,115    8,809     9,829 11,424 13542 16,026           18,026
 17,926                                                                8,345 9,041 10,109 11,801 14,038 16,526                18,526
                                                                       8,577    9,274 10,389 12,179 14,534 17,026             19,027
  * Points to be deleted 1 April 1983                                           9,549 10,675 12,599 15,030
  t Point to be deleted 1 April 1984
  0 Points to be added 31 March 1983                                   * Schedule A staff only
                                                                     Schedule   A Staff—CA Grades (six monthly increments)
                                                                       CAJ        CA2    CA3     CA4      CAS        CA6       CA7
                                                                       2,768     3,960   4,357  4,654     5,544     5,837     6,518
                                                                       2,860     4,059   4,455  4,753     5,642     5,935     6,614
                                                                       2,953     4,158   4,555  4,853     5,739     6,031     6,712
                                                                       3,046     4,258   4,654  4,952     5,837     6,129     6,823
                                                                       3,139     4,357   4,753   5,051    5,935     6,226     6,935
                                                                      (3,463)    4,455   4,853   5,151    6,031     6,324     7,046
                                                                       3,562     4,555   4,952   5,250    6,129     6,420     7,158
                                                                       3,662     4,654   5,051   5,349    6,226     6,518     7,268
                                                                       3,761     4,753   5,151   5,447    6,324     6,614     7,380
                                                                       3,860     4,853   5,250   5,544    6,420     6,712     7,490
                                                                       3,960             5,349   5,642    6,518     6,823     7,602
                                                                       4,059             5,447   5,739 6,614        6,935
                                                                                         5,544   5,837              7,046
                                                                                         5,642   5,935
                                                                                         5,739  6,031
                                                                                                6,129
                                                                                                6,226
                                                                     Whistleholder Payment (CA6 and CA7 only) £207 pa
                                                                     () Minimum salary on set incremental date following 18th birth-
                                                                     day.

                                                               235
                   SALARY SCALE (f pa)                                               SALARY SCALES (£ pa)
NJC—Schedule B Slaff— Effecthre from: 1 May 1982                    NJIC AND NJ(B&CE)C—Foremen grades, Effective from:
(six monthly increments)                                            17 March 1982
                  Sales                 Shop Supervisor
    Trainee      Person/  Senior                                       Scale I               Scale II                Scale III
     Sales       Demon-    Sales       Small     Medium                 7,101                  7,601                   8,133
    Person       strator  Person       Shop        Shop                 7,351                  7,866                   8,400
     2,768        4,555    5,739       5,935                            7,601                 .8,133                   8,667
                                                   6,518                7,866                  8,400                   8,934
     2,860        4,654    5,837       6,031       6,614
     2,953        4,753    5,935       6,129       6,712                8,133                  8,667                   9,201
     3,046        4,853    6,031       6,226       6,823
     3,139        4,952    6,129       6,324       6,935            NJIC and NJ(B&CE)C—Industrial grades, Effectire from:
    (3,463)       5,051    6,226       6,420                        17 March 1982
                                                   7,046
     3,562        5,151    6,324       6,518       7,158               Band I     Band 2  Band 3       Band 4         Band 5
     3,662        5,250    6,420       6,614       7,268
     3,761        5,349    6,518       6,712       7,380
                                                                        5,383      5,764   6,192        6,630          7,071
     3,860        5,447    6,614       6,823       7,490
                                                                        5,510      5,902  6,337         6,777          7,219
     3,960        5,544    6,712       6,935       7,602
                                                                        5,637      6,047  6,483         6,924          7,367
     4,059        5,642    6,823       7,046       7,713
                                                                        5,764      6,192   6,630        7,071          7,517
     4,158        5,739                7,158       7,823
                  5,837                            7,936
                  5,935
                  6,031
                  6,129

Schedule A & B Staff: Junior Administrative Grade—£3662 to
£6420 pa
() Minimum salary on set incremental date following 18th Birth-
day.
Schedule B Additional
    Payments:
  Sales Targets—First Payment£96 pa
   Sales Targets—Second
    Payment                    £207 pa
   Supervisor of One man Shop £207 pa
   Late Night Opening          £3-95 per occasion
  Work spread over more than
    5 days                     £4-70 per week
   Saturday as part of Normal £3-20 to £6*15 depending on
    Working Week               grade. Payments are made
                               for each morning and/or
                               afternoon worked.




                                            OUT-OF-HOURS PAYMENTS
  NJB EMPLOYEES
  First Excess Hour Worked:
  Day employees would receive a payment of £22-00 for a call-out on a normal working day,
  and £33-00 for a call-out on a normal day-off. For other than call-out day employees would
  receive the ordinary time rate plus 25% on a normal working day and a payment of £33*00
  on a normal day-off.
  Shift employees would receive the ordinary time rate plus 25% on a normal working day and
  a payment of £33-00 on a normal day-off.
  Additional excess hours worked are paid at ordinary time rate plus 25%. Staff may request
  equivalent time off in lieu of payment.
  Weekly Standby Payment:
  Standby retainer £44-00.
  NJC—PAG GRADED EMPLOYEES
  First Excess Hour Worked:
  Day employees would receive a payment of £22-00 for a call-out on a normal working day,
  and £33-00 for a call-out on a normal dayoff. For other than call-out day employees would
  receive the plain time rate plus 25% on a normal working day and a payment of £33-00 on
  a normal day-off.
  Shift employees would receive the plain time rate plus 25% on a normal working day and a
  payment of £33-00 on a normal dayoff.
  Additional excess hours worked are paid at plain time rate plus 25%.
  Staff may request equivalent time-off in lieu of payment.
                                                              236
NJC—CA AND RELATED GRADES
Time Worked in Extension of a Normal Working Day or Shift:
First 2 hours in any week; payment at plain time rate plus 25%. For each hour in excess of
2 hours in any week; payment at plain time rate plus 50%.
Work on Normal Day-off:
A payment of £27-50 or £33-00 (depending on Grade) for the first hour and thereafter equivalent
time-off.
Call-Out on Normal Working Day:
A payment of £22-00 for the first hour and thereafter payment at plain time rate plus 25%.
Call-Out on a Normal Day-Off:
A payment of £33-00 for the first hour and thereafter payment at plain time rate plus 25%.
Weekly Standby Payments: (All NJC Employees)
Standby Retainer Monday to Sunday £44-00
                 Monday to Friday £19-50




                                  OVERTIME PAYMENTS
NJIC AND NJ(B&CE)C EMPLOYEES
Day Employees:
Monday to Friday; normal starting time to Midnight paid at plain time rate plus 50%. Midnight
to normal starting time paid at double plain time rate (if called in at or after 6am payment
at plain time rate plus 50%), plus plain time rate for hours between leaving work and normal
starting time next day.
Weekend; Saturday up to normal starting time paid at double plain time rate (if called in at
or after 6am payment at plain time rate plus 50%).
Normal starting time to Midnight paid at plain time rate plus 50%. Sunday; Midnight to Midnight
paid at double plain time rate.
Shift Employees:
Monday to Saturday; shift overtime rate plus 50% for the first 4 hours, double shift overtime
rate until next shift.
Sunday. Days off and Public Holidays; double shift overtime rate
Weekly Standby Payment:
Standby Retainer: £35-00.




                                   SHIFT ALLOWANCES
Payment for fully continuous 3 shift working: 24 hours 7 days a week
NJB: Effective from 1 February 1982
  £1,775 to £3,610 pa dependent on grade and incremental point.
NJC: Effective from 1 May 1982
 £1,935 to £3,600 pa for PAG graded employees dependent on grade and incremental point.
 £810 to £2,055 pa for CA and Related grade employees dependent on grade and incremental
 point.
NJIC and NJ(B&CE)C: Effective from 17 March 1982
  An annual allowance of £100 plus an unsocial hours payment for normal shift hours based
 on an hourly rate of between 185 and 255 pence per hour (depending on salary band), at
 the rate of:
    (i) half time for all hours worked on a Saturday
   (ii) single time for all hours worked on Sundays and public holidays
  (iii) half time for all hours worked between 8pm and 6am.
                                             237
                                             LONDON WEIGHTING

Effective from: 1 July 1982
Inner London Allowance:
  Over 18 years of age—£1,333 pa.
  Up to 18 years of age—£941 pa.
Outer London Allowance:
  Over 18 years of age—£615 pa.
  Up to 18 years of age—£356 pa.
London Allowance is reckonable for superannuation, holidays and sick pay purposes, but is
not reckonable for other purposes.




 Source: Electricity Council.
 Note: Salary scales for NJIC and NJB staff have recently been revised. Details are available from the Electricity Council.

                                                           238
                                               APPENDIX 11.1
                                      (referred to in paragraph 11.28)

                              Retail prices of selected appliances

The tables below show the prices obtaining in various outlets in the YEB
area on 9 February 1983. Comparing prices is made difficult by (a) part-
exchange offers which may either be genuine (ie the retailer sells the old
appliance back to the manufacturer for reconditioning) or a form of discount
(ie it is offered for any appliance regardless of its condition), (b) variations
in arrangements and charges for delivery and connection; (c) offers of interest-
free credit and (d) minor variations in model. As far as possible, allowance
has been made for these factors in the tables. On the limited range of
appliances surveyed, the tentative conclusions are:
   1. Vacuum cleaners. YEB tends to be cheaper than the regional town centre
       stores (Wigfalls, Vallances) but more expensive than the national chains
       (Currys, Comet).
   2. Fridge-freezers. YEB is slightly more expensive.
   3. Cookers. YEB is competitive on the cheaper model; the more expensive
       model appears to be relatively expensive at YEB.




    Prices of selected appliances in YEB area, 9 February 1983


                                  Vacuum cleaners (excluding delivery)

                                                                                        Electrolux 502S
                          Hoover 1104                                                     (with tools)
                            Price              Index                                             Price            Index
Retailer                       (£)        (YEB=100)                      Retailer                   (£)        (YEB = 100)
Wigfalls                        70             (113)                Vallances                        74             (106)
Vallances                       67             (108)                Leeds Co-op                      71             (101)
YEB                             62             (100)                YEB                              70             (100)

Currys                          57               (92)                Wigfalls                        67               (96)
Comet                           56               (90)               Currys                           65               (93)
Leeds Co-op          ^                                              Cole Brothers "1
                                55               (89)                                                62               (89)
Cole Brothers J                                                     Comet                 J
 Notes:    1 Prices are rounded to the nearest £.
           2. YEB's Hoover vacuum cleaner is the 1108, which is exclusive to the Electricity Boards. It differs in minor respects
                   from the 1104 (eg it has a headlight).
           3. Part exchange is offered by several of these retailers. Leeds Co-op and Wigfalls offer £7, YEB and Vallances
                  £5. Comet and Cole Brothers do not offer part exchange.
           4. Vallances price includes 12 month's interest-free credit.

                                                            239
                                     Fridge-freezers (including delivery)

                    LEG T241 SL                                                         LEG T201 SL
                          Price              Index                                            Price              Index
Retailer                       (£)        (YEB =100)                       Retailer                (£)        (YEB=100)
YEB                            174           (100)                 YEB                             159           (100)
Vallances                      167              (96)                Vallances                      158              (99)
Currys                         163              (94)                Currys                         153              (96)
Wigfalls                       158              (91)                Wigfalls                       150              (94)
Comet                          145              (83)                Comet                          136              (86)
  Note: Neither of these fridge-freezers was in stock in Leeds Co-op or Cole Brothers. Vallances price includes 12 month's
        interest-free credit.




                           Cookers (including delivery and connection)1"

                 Tricity Tiara 1414                                                Tricity Contessa 1655
                           Price       Index                                                  Price       Index
Retailer                    (£)     (YEB =100)                     Retailer                    (£)     (YEB = 100)
Vallances                  204t§       (107)                       Wigfalls                    289t      (107)
                                                                   Vallances                       279t§          (104)
Currys                         195t            (103)               YEB                             269*            (100)
YEB                            190*            (100)               Currys                          260t            (97)
Leeds Co-op                    188|             (99)               Leeds Co-op                     255             (93)
Cole Brothers                  186t             (98)               Cole Brothers                   247t            (92)
Comet                          186*             (98)               Comet                           245             (91)
Wigfalls                       182t             (96)

   * YEB includes connection and testing in its price. Comet has an installation service for cookers, charging £14-50 (included
in the price shown).
  + Customer has to make own arrangements for connection. We have added an estimated £17 for this service (including the
value of the customer's time).
   J Leeds Co-op makes a charge for connection of between £8 and £12. The price shown above includes an estimated average
of £10 for connection.
   8 Vallances price includes 12 months' interest free credit.




                                                            240
                                       APPENDIX 12.1
                              (referred to in paragraph 12.5)

                               Price Indkes (1972 = 100)

                                              % Change                  % Change
                                  YEB            on        RPI             on
                                              previous                  previous
                                                year                      year

                       1972       100                      100
                       1973       105            5         109             9
                       1974       134           28         127            17
                       1975       186           39         157            24
                       1976       223           20         183            17
                       1977       253           13         212            16
                       1978       276            9         230             8
                       1979       302            9         261            13
                       1980       389           29         308            18
                       1981       457           17         344            12
                       1982       497            9         374             9

                                             as published by
                  industrial price of gas j
                                             the Department of Energy
                 wholesale price of coal                             as published by
                                                                     the Department of
                 wholesale price of medium fuel oil                  Trade and Industry
                 index of retail prices - from figures published by the
                                          Department of Employment
                 average price per unit paid by customers in YEB area

850                                                                                       i oil

800


                                                                                          .-gas



650
                                                                                            coal
600




500
                                                                  77 /                       YEB
                                                                                           ' electricity
450

400
                                                                                            retail price
                                                                                            index
350

300


250




150



  1972   1973   1974    1975     1976   1977      1978   1979    1980     1981     1982

Source: YEB, MMC study.
                                                241
                                            APPENDIX 12.2
                                   (referred to in paragraph 12.6)
                        YEB Tariff Income Indices: 1971-72 = 100
                 YEB      % change          BST       % change    RESIDUAL      % change    RPI     % change
                TOTAL        on          COMPONENT       on      COMPONENT         on                  on
               INCOME     previous                    previous                  previous            previous
                            year                        year                      year                year
  1971-72       100                         100                      100                     100
  1972-73       102          2              104          4            95           -5        107        7
  1973-74       108          6              112          8            92           -3        118       10
  1974-75       146         35              166         48            76          -17        139       18
  1975-76       204         40              213         28           171          125        1,74      25
  1976-77       233         14              244         15           196            15       200       15
  1977-78       263         13              272         11           232            18       228       14
  1978-79       287          9              297          9           252             9     . 247        8
  1979-80       327         14              352         19           240           -5        286       16
  1980-81       416         27              435         24           353           47        333       16
  1981-82       473         14              492         13           405            15       371       11
  1982-83       518         10              546         11           421            4        398        7


          YEB Tariff Income Indices:
          1971 - 7 2 = 100



    550                              Total Income
                                     BST Component
                                     Residual Component
                                     (covering YEB's other costs and profits)
    500




   450




    400




    350                                                                    .////
                                                                               '/
    300                                                                     /!
    250
                                                                   /
                                                                 -S^
    200



    150



    100                              I /
     71 -72 "72-73      73-74    74-75     75-76   76-77 77-78 78-79 79-80 80-81             81-82 82-83
Source:   YEB, MMC study.       ^""*^/

                                                     242
                                 APPENDIX 12.3
                        (referred to in paragraph 12.15)

  The annuity factor applied to the costs of notional increments of
                       distribution capacity

   1. The annuity factor includes the 5 per cent real rate of return required
for investment by nationalised industries (see paragraph 6.7); a 2-25 per cent
premium for maintenance and repairs in the earlier years of an asset's life;
and a further 2 per cent premium (known as a tilt). The tilt is included partly
because maintenance and repair costs are expected to rise beyond 2-25 per
cent towards the end of an asset's life; partly because switches in the pattern
of demand between areas are likely to render some assets redundant before
the end of what would otherwise have been considered their expected life;
and partly because of lower costs associated with new assets resulting from,
eg technological improvements over the current system. Part of the 'tilt' there-
fore contributes to the costs of increments made in previous years, simplifying
what could otherwise be the task, under LRMC pricing principles, of incorpor-
ating in current tariffs the sum of annuities, adjusted for inflation, relating
to previous increments.

   2. The formula for the annuity factor (f) applied to present capital values
is f=a+m, where a=(r+t)Q-(l-t) n (H-r)~ n ]- 1 ; r=the required annual
real rate of return (=O5); t=tilt (=-02); n=expected life of the assets which
is assumed to equal 40 years; and m = the premium for maintenance and
repairs in the earlier years of an asset's life (=0-0225). The value of a is
very sensitive to change in assumptions about t, the value for which has been
fixed following Electricity Council research; a is not very sensitive to plausible
changes in assumptions about n.




                                      243
                                  APPENDIX 12.4
                   (referred to in paragraph 12.34 and 12.39)
  Complaints about tariffs from some large industrial consumers

   1. The British Steel Corporation (BSC), the National Federation of Clay
Industries (NFCI) and the Chemical Industries Association (CIA) made refer-
ence to the competitive disadvantage suffered by their members through pay-
ing more for electricity than their continental rivals particularly in Germany
and France. NFCI think that the Government should set the ESI a lower
financial target to allow area boards to face the market-place more competi-
tively. In reply, YEB said it is! difficult to establish the reasons for international
price differences: they are affected from time to time by fluctuating exchange
rates; there is some evidence that the German price is linked to that of brown
coal; and in France the electricity industry is operating at a considerable
loss, with some £1*4 billion of debt having been written off. The ESFs financial
objectives are a matter for the Government.
   2. BSC, NFCI, CIA and the Glass Manufacturers Federation (GMF)
argued for relief for continuous, ie high load factor (HLF) consumers. NFCI
said that the overwhelming majority of these are unable to take advantage
of contract load management terms. YEB said that HLF consumers contend
that they should not pay for contributions to system peaks but should be
charged instead according to the lower costs of base load generating plant.
The Electricity Council told us that this type of plant has high capital costs
but low running costs compared with other plant. At load factors above 65
per cent, base load plant is cheaper overall than other plant. But detailed
studies carried out during the latest BST review (see paragraph 12.8) have
shown that there would be very little effect on charges if the BST were altered
to reflect the costs of different types of plant; for example the HLF consumer
would pay during daytimes a lower unit rate but a higher capacity charge.
The Electricity Council thinks its tariff structure is superior in its reflection
of marginal costs for all levels of load factor, high or low. With particular
reference to BSC, the Electricity Council said BSC plants have annual load
factors ranging from 15 per cent to only 63 per cent, below the point where
base load plant became cheaper overall; YEB pointed out that BSC does
take advantage of contract load management terms (see paragraphs 7 and
8 below). On GMF's suggestion that glass manufacturers should be charged
on Saturdays and Sundays at the night rate, YEB told us that the BST does
not differentiate between days of the week for unit charges; it could not so
differentiate without affecting other charges.
   3. One CIA member company suggested that its charges should be lower
bearing in mind that its HLF plant is near two large power stations. YEB
said it is impossible to identify which power stations feed which consumers,
because each power station feeds into the National Grid.
  4. On contract load management terms, CIA said that many consumers
have pointed to the associated potential disruption and cost. YEB said that
the extent of the disruptions and costs is not revealed; in practice, an average
                                      244
of only 5-3 hours per annum have been made subject by CEGB to load mana-
gement restrictions in the five year period 1978 to 1983. Another CIA member
company thinks that a financial penalty accrues against a consumer whose
performance meets the contract terms. But, as explained in paragraph 12.32,
YEB said that its rebates are made with appropriate interest payments.
   5. One CIA member said that, although industrial tariffs reflect the BST,
there are rapidly diminishing reductions in unit charges when a consumer
improves his load factor to over 50 per cent. YEB replied that the net advan-
tage to the consumer depends on how the load is spread. The benefit from
extending shifts from five to seven days are not as high as from introducing
a third daily shift for the night period.

   6. NFCI pointed out that YEB's demand charges are much lower than
those of the East Midlands and North Eastern Electricity Boards, but that
this is completely overriden by YEB's much higher unit charges. YEB replied
that differences in charges between area boards are to be expected since each
acts as an autonomous body. Charging differentials reflect for example differ-
ing costs and differing annual financial objectives.
   7. NFCI said that visits by its members to YEB offices have given a 'no
expense spared' feeling. BSC thinks that insufficient attention is given to
administrative efficiency; a percentage on-cost procedure has simply allowed
administration costs to escalate in line with what have been massive coal
price increases. YEB said that its offices are designed as efficient units, incor-
porating standards of comfort which any caring employer might reasonably
be expected to provide for his staff. The share of administration costs in
total BSC charges had fallen from 5-4 per cent in 1978-79 to 3-1 per cent
in 1982-83. Excluding rates and Electricity Council expenses, the share had
fallen from 2*7 per cent to —0-6 per cent, the apparent loss being justified
by the allowance for flexibility in the target rate of return for load management
contracts.
   8. Finally, BSC said that it wishes to negotiate directly with CEGB, noting
that more than 95 per cent of its electricity charges reflect purchases from
CEGB. YEB replied that it has never merely passed on costs arising from
BST. It has campaigned strongly on issues raised by BSC and other consumers
in discussions with CEGB. through contract load terms and the flexibility
allowance, YEB and CEGB have trimmed BSC's terms to the point where
YEB believes any further reduction could be challenged under the undue pre-
ference provisions of the Electricity Acts. In sum, YEB does not believe BSC
could get better terms if it were to negotiate directly with CEGB.




                                      245
                                APPENDIX 12.5
                       (referred to in paragraph 12.45)

          The case for reviewing connection charge policy

   1. The case depends in part upon the variation in costs of connection of
between £100 to beyond £2,500 (see paragraph 12.24). But the variation is
largely reflected by the system of abnormal connection charges. There remain
some variations in what YEB terms the normal costs of supply, owing mainly
to the design and phasing of construction of new estates. At present YEB
recovers a notional minimum supply cost through a combination of its higher
standard connection charge and the standing charge. It is possible that costs
might be recovered more fully by employing a larger number of standard
charges, more closely reflecting the variety in the designs and phasings of
construction of new estates, although this could involve YEB in additional
expenditure through trying to explain their basis.

   2. Residual costs associated with connections are recoverecl in principle
through the unit charge. These include the costs of transformers, sub-stations
and reinforcement of the higher voltage system which bear on improved secur-
ity. As explained in paragraph 6.34 we do not believe that these costs should
be recovered through connection charges where the improved security result-
ing from the additional assets is shared by a large number of consumers.

  3. Residual costs also include the relatively unimportant costs of providing
up to 60 feet of electric line falling outside a consumer's property, in accord-
ance with section 27(1) of the Electric Lighting (Clauses) Act 1899. If the
present standard connection charges were raised so that they fully recovered
normal costs, area boards would face greater risk of challenge under section
27(1) in respect of low cost connections.

  4. For connection costs which can properly be related to individual con-
sumers, capital charges may be preferred to revenue charges in that owners
or occupiers of premises are each more likely to bear the costs each imposes
on the system, passing these on to future owners or occupiers through altered
property prices. Revenue charges (whether standing or unit charges) apply
to current and future customers at large, with none specially concerned to
apply downward pressure on the cost of any particular development of the
electricity system. They may be appropriate where it is difficult to identify
the consumers, current or future, benefitting from marginal extensions to the
system. Moreover, in so far as more of these costs could be attributed to
particular customers and capital charges made for them, annual revenue
charges may not be much reduced unless the financial target were reduced
accordingly.




                      Printed in the UK. for Her Majesty's Stationery Office
                                   Dd 401014 CIS 9/83 (7381)

				
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