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1983. It is assumed that the past natural flow, over the long term, is a reliable predictor of future water availability. The future water estimated to be available in the Colorado River is used in conjunction with a database containing demand information regarding projected monthly Upper Colorado River Basin water depletions, withdrawals, and diversions (due to the increasing consumptive use of the Upper Colorado River Basin water), together with estimated water returned to the river after use. Restrictions on simulated water releases from the CRSP reservoirs reflect provisions of the "Criteria for Coordi- nated Long-Range Operation of Colorado River Reservoirs." These criteria, adopted by the Secretary of the Interior as specified in Section 602(a) of the Colorado River Basin Project Act, Public Law 90-537, 82 Stat. 900, dated September 30, 1968; comply with provisions of the Colorado River Compact, the Upper Colorado Riyer Basin Compact, and the Mexican Water Treaty. Each year, the annual operating plan of the reservoirs is adopted by Reclamation following consultation with Upper and Lower Basin States. After all of the hydrology and demand data is compiled, the CRSM simulates the future monthly water release and subsequent power production at the various CRSP powerp1ants. Each year, at Western's request, Reclamation furnishes the results of the CRSM monthly total energy and capacity, projected to the end.of the repayment study period. a. Procedure for Estimating CRSP Energy Production. From the annual and monthly CRSP energy projections, the "average" annual energy is selected as the basis for revenue estimates and repayment purposes. Western refines these "average" energy estimates by applying a 5-year moving average computer program to the CRSM projections. The program "smooths" the jagged curve, as can be seen in Figure 1, Appendix G. The 5-year moving average projections then are used in future years of the PRS to predict future hydroelectric generation. The annual energy projections of Figure 1 show increased generation during the 1990s, because additional generation from several of the CRSP participating projects is expected to come on-line during that period. A gradual decline in average annual energy through the year 2078 is due in large part to anticipated increased Upper Colorado River Basin depletions for irrigation and consumptive purposes. b. Procedure for Estimating CRSP Capacity Production. Capacity projections require a more complex analysis than do the energy projections. In establishing the basis for rate making, Western assumes a 25 percent level of risk, 8