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6 thereby lend support to their "yardstick" system. Heavy flows of project power were imposed on investor-owned utility lines and REA lines and reim- bursement for the use of these facilities was ignored. At a meeting in Salt Lake City on March 13 and 14, 1961, the Bureau stated that such flows would be free for the Federal government under the all-Federal system but would be an expense to the Federal government if the utilities built any lines. Even with the free use of utilities' lines and the construction of some 600 miles of "non-related" transmission lines, the all-Federal system is not capable of reasonable operation and is not an adequate "yard- stick. " What is an adequate "yardstick?" It has long been our under- standing that a yardstick is a finite unit of measure defined and main. tained as a physical standard by the National Bureau of Standards and as such is 36-inches long. We find ourselves in the analyses under discussion being subject to yardsticks of varying lengths, and I will now point out a few of these short measuring sticks to you. Under date of August 31, 1960, the Bureau supplied the utilities with load and generation schedules indicating that 600,000 kilowatts would have to be delivered to Arizona preference users in the early years and that this was the basis of applying the utilities' wheeling offers. Although the utilities were instructed they must be able to deliver 600,000 kilowatts of power to Arizona preference users, the Federal government "yardstick" system, by the Bureau's own admission, does not have sufficient capacity to deliver more than 450,000 kilowatts to Arizona, therefore, the ground rules for the all-Federal transmission system is in direct violation of the Secretary's marketing criteria. Figure 3 shows the 150,000 kilowatt difference in these two yardsticks, The Bureau stated that this difference of 150,000 kilowatts would be sold to the investor- owned companIes in direct violation of the Secretary's marketing criteria. Another obvious discrepancy in the two systems is the different criteria used in computing the operation, maintenance and replacement ex- pense for the Federal transmission lines under the two systems. Figure 4 shows this expense in $ per <.He for the two systems, Under the all-Federal transmission system, the Bureau used an equivalent operation, maintenance expense for their transmission system of $840/mile of line. For the Federal line under the combination system, they used $1365/mile of line. This is again indicative of the two types of yardsticks used to measure this job. The two systems are not comparable with respect to transmission losses. The Bureau assumed that the power losses for the two systems would be the same, Engineering studIes show that there is a marked difference. Figure 5 shows that increased project revenues from the combination system amount to some $76 million over the 86-year period. Arizona Public Service Company and Public Service Company of New Mexico offered to wheel under either an energy or a demand charge type rate. The Bureau was given the opportunity of using either charge, depend- ing on load schedules and length of analysis, which would result in the minimum cost. The Bureau, in both instances, used the most expensive rates.