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<br /> <br />COLORADO RIVER STORAGE! PROJECT <br /> <br />9 <br /> <br />in what has been termed imputed interest on the non~interest~bearing' irrigation <br />ltllooation. If the utilities built the lines, they would pity Federal income..taxes <br />on those lines. On the other hand the costs of power to the preference eustomers <br />'would be higher. In;.reco&.nition of these factors, computations have been made <br />comparing costs and ,savings under the utility proposal. <br />Thifl comparison, on the basis of present worth of annual savings and costs,' is <br />shown in table 2 hereof. Included in savings are the savings in construct.ion costs <br />to the United States, savings in operation, maintena,nce, and replaoements', reduc- <br />tion in imputed interest on the irrigation allocation of the storage units, and .Federal <br />income txxes. forgone~ Imputed interest costs are generally not considered <br />by the Bureau but are 'included herein because of views expressed by the utiliti~.s. <br />Table 2 shows that the present worth of the increased costs under the utility <br />proposal exceeds the pziesent worth of savings to the United States py $36,756,000 <br />in the case where the rate for firm energy is 6.57 mills per kilowatt-hour under <br />the utility proposal and {) mills per kilowatt~hour under the yardstick system. <br />With a rate of 6 mills ,per kilowatt~hour for firm energy under both the utility <br />proposal and the yardstick system the present worth of the increased costs <br />exceeds the savings by $45,463,000 under the utility proposal. <br /> <br />TABLE 2.-Bureau's coinputaJ:t'ons of present worth of savings and increased costs <br />under the utility proposal t <br /> <br />Item <br /> <br />SavIngs <br /> <br />Increased <br />co'" <br /> <br />6.67.m:lll rate for utility proposa.tand fJ-.rnilJ rate for yardstick system: <br />Tmnsmlssfon investment 2_ _c. _ _n_.._._w._._.._._h._h.___w_w_._....w.. $109,847. 000 ._._n~.~_.w_~ <br />Operation and maintenance and rep18cement.~~.w._~._w~..~w~_.w_w..____ 86,641, 000 _w._.w_w~..__. <br />Federal ta.xes forgone 3.___..:._.__w_. _.___h_..___'_._._~__._.._._._"h_ 80,000,000 'h_.UW.W.'__ <br />Imputed jnt€'rest on Jrrlge.tlo~_......w.._w...._._.~.~_._~_w~._.~w_.___h_ 4,631,000 w_____w_w_._.. <br />Wheeling costs_. ...._._W_hW~W...u._...~hh._d._.W..~__..~.._~_._.h_ ~___.'_~_hW__ $217,775, 00l' <br />Total._..w......_.._.~..__.~W_W.W.h.W.W._._._Wh~_W._d._.w...__..__.~ 181,019,000 217,775,000 <br />Dlfferen()(l_w__w..._..n.._._w~~.w_wn..__w___'w_w..~..w_w.w..W.W.W.WWhW. ~h._W__..w.u 86,756,000 <br />6-m1l1 rate for both utJUty propOsal and yardstick system: <br />'l'rfl,lJ,~mlss1on Iuvestment,). _. ._n._.....~__~.~._._whh_.~w._~u.~...._~. 109,847,000 .._nww.ww..n <br />Operation and maintenance and reple.cemeut..w.w__.w~.~__w.w.w._~uw_~. 86,541,000 _h_.......w__ <br />Federal taKes r(lrg(lne3__.n_n~..._.._w.w._n...W...W.h.d_W~W~n_w.__.w 30,1)00,000 W"h_"~_h'~~_ <br />Imputed interest on irrl.gat1on~..U____Wh~..._.~...W..h_..W~_~~_w_w____w '.~.WW'_...~._ 4,076,000 <br />Wheeling l.!Osts_.~.w._~...._w_.._...W.hW..__.w~._.w.w._._..nwuw_h..._ ___w.._w.w.wn 217,775,000 <br />TotaL....W~._hw.w.._n._w...;.W._.Uh._._.W._Wh___.W...w_..._..~.._.. 176,~ 221,851,000 <br />Df1ference..W.Wh.hW~._w.w..~~ww.....WW_...Wh~W...._w.w_._.._h_.....w_. .w..n.ww...... 45,463,000 <br /> <br />t For perIod, 11164 through 2049, ' <br />) Includes il'lterest dUring construotlon. <br />, Although termed "sav/ngs" tho item of taxes forgono ill aotually income not received. <br /> <br />Two other analyses using wheeling costs Were made but using a somewhat <br />different approaoh in arriving at average firm power rates. The results of these <br />studies show average rates of the same relative magnitude as those repor*ed in <br />1re.ble 2 and hence, are not discussed herein. They may be found on pages 43 <br />and 45 of the regional director's report. <br /> <br /> <br />ANALYSIS UNDE& CONGRESSIONAL COMMITTEE COMMENTS <br /> <br />House Document No. 1087, 84th Congress> contains the following: <br />"Their (the utilities') proposal provides essentially that the Secretary <br />construct the backbone ,transmission lines connecting major powerplants of <br />the project and that use be made of the existing systems of the companies <br />and additions thereto to market the power. <br />"The proposal is consistent with the policy expressed by the Congress for' <br />ma.ny years in appropriation aots and elsewhere whereby the Federal Gov- <br />ernment. builds the basic.' backbone transmission system and distribution is <br />made through. existing systems where satisfactory arrangements can be <br />wOl'ked out. <br />IITherefore, the committee expects the proposal by the private power <br />companies for cooperation; in the development to be carefuIly oonsidered by <br />the DePt!-rtment of the Interior and the electrio power and energy of the <br />project to be marketed, so 'far as possible, through the facilities of the electriC' <br /> <br />