WSP07981

• File Number: 8446
• Description: Cache La Poudre Platte Project
• State: CO
• Basin: South Platte
• Water Division: 1
• Date: 11/1/1982
• Title: Economic Evaluation Procedures Phase II Cache la Poudre Project Study
• Water Supply Pro - Doc Type: Report/Study

.

.

irrigation and (4) new storage space for the
already developed irrigation water supplies.
are referred to collectively as conservation

better management of
The latter three
storage purposes.

The economic evaluations performed in Phase I dealt only
with the composite monetary costs and monetary benefits of the
alternatives. In Phase II, the costs and benefits of
conservation storage, peaking power ana run-of-river power will
be analyzed separately.

The economic evaluation will be performed in three steps, as
follows:

1. Alternatives 1 and 8 represent project configurations
whose major purposes are conservation storage. For
these two alternatives, benefit/cost ratios will be
calculated for the total benefits and total costs
associated with the three major conservation purposes
(i.e., supplemental irrigation water, M&I water uses and
improved management). The difference between total
annual costs and total annual benefits will also be
displayed and discussed for these two alternatives to
demonstrate the magnitude of the difference between
benefits and costs.

2. Alternatives 2 and 7 are representative of multiple-
reservoir configurations with large-scale hydropower
peaking facilities upstream of terminal storage
reservoirs. For these two alternatives, the separable
costs of the peaking power facilities will be
estimated. For alternative 2, the separable costs are
total project costs (except run-of-river hydro) less the
costs of alternative 1. For alternative 7, the
separable costs are the total project costs (except
run-of-river hydro) less the costs of alternative 8. A
break-even analysis is then performed by setting
benefits equal to the separable costs of peaking power.

3. In phase I of the study, it was determined that the unit
costs (cost per killowatt of installed capacity) for
run-of-river hydropower are virtually the same for each
alternative. The benefit/cost ratio for run-of-river
hydropower will be calculated using a representative
unit cost for the separable costs of run-of-river power
and a unit value for benefits based on an average plant
factor and the unit value of such power as determined in
Phase I. The resulting benefit/cost ratio shall be
considered to be representative of run-of-river power
for all four alternatives.

Measurement Standards

The economic evaluations to be performed shall deal
exclusively with direct monetary effects. Unless otherwise

-2-