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<br />.,' I <br /> <br />The following criteria and assumptions were used in the <br />preliminary reconnaissance appraisal of the unit: <br /> <br />(a) Only direct power benefits are considered. <br /> <br />(b) No allocation of costs is made at this time to river <br />regulc.tion for future irrigation and other consumptive uses. <br /> <br />(c) Costs of the unit and of alt ernati ve steam power for <br />comparative purposes are based on amortizing costs with an interest <br />rate cf 2.5 percent over a 50-year period of analysis. Taxes are not <br />inc1ud ed in the analysis.. <br /> <br />(d) Average finn energy production deliverable to load <br />centers is based on est:i1nated 20-year depleted streamflows for the <br />1931-44 streamflow conditions and estimated power transmission losses. <br /> <br />(e) Present worth of the estillated salvage value at the end <br />of 50 years was deducted from construction costs in computing the <br />benefit-cost ratio. <br /> <br />(f) Delta, };.ontrose, Grand Junction, Nucla, and Gunnison, <br />Colo., were assumed as power market load centers for th e study. <br /> <br />General results of the reconnaissance appraisal on the above <br />basis fo r the Curecanti Reservoir and Blue Mesa Dam and powerplant <br />alone .:md for the overall Curecanti unit are summarized below. <br /> <br />Scale of development <br />Curecanti Reservoir, Curecanti unit <br />Blue Mesa Dam and (four dams and <br />powerplant alone powerplants) <br /> <br />Averag'~ cost per kilowatt-hour <br />Cost p'~ kilowatt-hour of <br />alternative steam power <br /> <br />9.4 mills <br /> <br />6.5 mills <br /> <br />9.0 mills <br /> <br />S.3 mills <br />1.4 to 1 <br /> <br />Benefit-cost ratio <br /> <br />1.1 to 1 <br /> <br />Although the reconnaissance studies indicate that the Blue <br />Mesa power plant when considered alone would have a benefit-cost ratio <br />slight:.y greater than unitlf 11" allowance is made for salvage value, the <br />average cost of energy would slightly exceed the cost of alternative <br />steam power. On the other hand, the benefit-cost ratio for the overall <br />Curecanti unit would be well over unity and the average cost of energy <br />would be 22 percent less than the cost of alternative steam power. <br /> <br />Detailed studies are necessary to refine the economic scale <br />of developnent and to confinn the present reconnaissance appraisal. <br /> <br />3 <br />