uses your investment say 3,000 hours a year, when the amount of money
invested to take care of either customer is precisely the same. Surely
the customer who uses the product on an average 30 times longer than
the customer using it for only 100 hours is entitled to a much lower
unit rate, in view of the fact that the expense for interest to the
company is in one case but a fraction per unit of output of what it is
in the other. This fact is illustrated by the interest columns on the
graphic chart already referred to. Supposing that the central station
manager desired to sell his product at cost, that is, an amount
sufficient to cover his operating, repairs and renewals, general
expense, and interest and depreciation, he would have to obtain from
the customer having the poorest load factor, as shown on the load
chart, over four times as much per unit of electricity as it would be
necessary for him to collect from the customer having the largest load
factor. No one would think of going to a bank to borrow money and
expect to pay precisely the same total interest whether he required
the money for one month or for twelve; and for the same reason it
seems an absurdity to sell electricity to the customer who uses it but
a comparatively few hours a year at the same price at which you would
sell it to the customer using it ten hours a day and three hundred
days a year, when it is remembered that interest is the largest factor
in cost, and the total amount of interest is the same with the
customer using it but a few hours a year as it is with the customer
using it practically all the year around.

I have dwelt thus at length on the question of interest cost in
operating a central station system, not alone for the purpose of
pointing out to you its importance in connection with an electrical
distribution system, but also to impress upon you its importance as a
factor in cost; in fact, the most important factor in cost in any