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<br />~ <br />M <br />t- <br />.-\ <br /> <br />,- <br />~ <br /> <br />c <br /> <br />posed. (Recall that Colorado-Ute's own analysis indicates that <br />the two dam system is not economically feasible.) ~/ <br /> <br />Financing the Project with Power Revenues and Other Sources <br /> <br /> <br />Using the assumptions made above and accepting CRWCD's <br /> <br />assertion that Colorado-Ute will buy power for 3.5 to 4 cents per <br /> <br />kwh, it would then face a net annual debt service approaching $10 <br /> <br />million (the difference between $l7.0 million and $7 million from <br /> <br />power sales). Under the Smith Barney assumptions, this implies a <br />bond sale of approximately $90 million.~/ The question to be <br /> <br />asked is whether CRWCD and its membership have the capacity to <br /> <br />raise the funds necessary to take on an obligation of this magni- <br /> <br />tude. <br /> <br />Concluding Comment <br /> <br />The new project CRWCD has under consideration leaves it with <br /> <br />two unappealing financing options--find a market for high cost <br />electricity or obligate itself and the citizens of Northwest <br /> <br />Colorado to payoff a bond issue of at least $90 million. Any <br /> <br />project which presents its sponsor with such unattractive alter- <br /> <br />natives is clearly financially infeasible. <br /> <br />3 <br />