BOARD00930

• Board Meeting Date: 5/10/1961
• Description: Minutes
• Board Meetings - Doc Type: Meeting

admitted to the infeasibility in their system
of a third circuit to the south into Arizona,
stating that 150,000 kilowatts of surplus which
could not be carried to Arizona under their sys-
tem would simply have to be marketed to non-
preference users in the Upper Basin.

The point here made is simply that for the
purposes of equal comparison of systems, the
all-federal investment should have been increased
approximately $15,000,000 to provide this third
circuit from Glen Canyon into Phoenix against the
600,000 criteria, or Arizona Public Service Com-
pany should have been given the opportunity to
revise their wheeling offer to reflect this
change in the distribution of power.

There were further requirements for appli-
cation of investment differentials to provide
an equalized system for comparative purposes.
This cropped up in the varying line distances
in the analysis between Glen Canyon and Cure-
canti. 297 miles for the all-federal system;
349 miles of Bureau transmission which they
established for the joint system. These lines,
under either plan for comparative purposes,
naturally would be of the sarne length. There-
fore the analysis produced an overstatement of
the Bureau's cost under the utilities proposal.
The net effect of crediting these items of in-
vestment differential produces an additional
$15,000,000 in investment savings in addition to
the $122 million which were reported in the Bur-
eau's analysis as being a savings in the joint
system over the all-federal system.

Now the second major point of concern lies
in the misapplication and distortion of the
offered wheeling rates. At the request of the
Bureau, two of the utility companies submitted
dual.wheeling rates, or alternate wheeling rates
I should say. They were offered the service
under either of two plans; either on a mills per
kilowatt hour basis; or dollars per kilowatt year
service. The Bureau was supplied these figures
with the idea that, depending on their load
schedules and length of analysis, they would

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