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(APPENDIX 1]

BOULDER CANYON PROJECT

GENERAL REGULATIONS: LEASES AND CONTRACTS FOR HOOVER DAM POWER

WASHINGTON, D. C.

April 25, 1930
Amended March 10, 1931, July 1, 1931

and November 16, 1931

101

BOULDER CANYON PROJECT

GENERAL REGULATIONS FOR LEASE OF POWER

I The United States will, at its own cost, construct in the main stream of the Colorado River, at Black Canyon, a dam, designated as Hoover Dam, creating thereby at the date of completion a storage reservoir having a maximum water surface elevation at about twelve hundred twenty-two (1,222) feet above sea level (United States Geological Survey datum) of a capacity of about twenty-nine million five hundred thousand (29,500,000) acre-feet. The United States will also construct in connection therewith outlet works, pressure tunnels, penstocks, power-plant building, and furnish and install generating, transforming, and high-voltage switching equipment for the generation of the energy allocated to the various allottees, respectively. Title to Hoover Dam, reservoir, plant, and incidental works shall forever remain in the United States.

II The United States will operate and maintain the dam, reservoir, pressure tunnels, penstocks to but not inclusive of the shut-off valves at the inlets to the turbine casings, and outlet works, and will have full control of all water passing the dam for any and all purposes. The dam and reservoir will be operated and used, first, for river regulation, improvement of navigation, and flood control; second, for irrigation and domestic uses and satisfaction of present perfected rights in pursuance of Article VIII of the Colorado River compact; and, third,

for power.

trical energy

III The United States will lease to the City of Los Angeles, referred to herein as the city, for fifty (50) years from the date at which energy is ready for delivery to the city, as announced by the Secretary, such power-plant units and corresponding plant facilities and incidental structures as may be necessary to generate the energy allocated to it and energy for those allottees for whom the city is herein designated the generating agency, together with the right to generate such elec

The United States will lease to Southern California Edison Co. (Ltd.), referred to herein as the company, such power-plant units and corresponding plant facilities and incidental structures as may be necessary to generate the energy allocated to it and energy for those allottees for whom the company is herein designated the generating agency, together with the right to generate such electrical energy, for a period beginning with the date at which the first of such powerplant units is ready for operation and water is available therefor as announced by the Secretary, and ending at a time fifty (50) years from the date at which energy is ready for delivery to the city.

The machinery and equipment under lease to either lessee shall be operated and maintained by such lessee without interference from or

control by the other lessee, but subject nevertheless to the supervisory authority of the Secretary or his representative, under the terms of the lease.

Subject to conditions hereinafter stated, the designation of generating agencies shall be as follows:

Generation of energy allocated to and used by the States of Nevada and Arizona shall be effected by the city.

Generation of energy allocated to municipalities shall be effected by the city.

Generation of energy allocated to the district shall be effected by the city.

Generation of energy allocated to the companies shall be effected by Southern California Edison Co. (Ltd.).

The lessees and allottees may make other arrangements for generation, subject to the approval of the Secretary.

Disputes and disagreements between any allottee and the lessee generating energy for it, with respect to such generation, and/or the cost thereof, shall be determined by the Secretary unless otherwise specifically provided by contracts thereof with the Secretary.

All generation shall be effected at cost, except as provided in contracts with the United States.

IV The respective portions of the power plant and appurtenant structures shall be operated and maintained by the city and the company, severally, under the supervision of a director appointed by the Secretary. The city and the company shall each be responsible for the operation and maintenance of that part of the power plant operated by it and shall bear the cost thereof. The United States will pay each lessee in the form of credits upon the account of such lessee for amounts due the United States under its contract, the cost incurred by it in generating energy for other allottees for whom it is the designated generating agency, and will require such other allottees to repay such cost to the United States. Except as to off-peak power the term "cost" as used with reference to generating energy for other allottees, shall include a proper proportionate allowance for amortization of the amounts for which the respective lessees are obligated to the United States on account of use of machinery and equipment and interest on the respective lessees' prepayments thereof; a proper proportionate part of any annuity set up in accordance with regulations of the Secretary, and any additional expenditures made by the respective lessees with the approval of the Secretary for the purpose of meeting the obligation of the lessees to make replacements; and a proper proportionate part of the actual outlay of the lessees for operating such machinery and equipment and keeping the same in repair, including reasonable overhead charges. The extent of the allowance for the several items and the system of accounting therefor shall be prescribed by the Secretary under uniform regulations to be promulgated by him in accordance with the Boulder Canyon project act. The United States will compensate each lessee for the generation by it of any secondary energy not taken by the district or the lessees in accordance with Article V hereof but disposed of by the United States, such compensation to cover the pro rata cost thereof as defined in this article in proportion to the total kilowatt-hours generated in that month by each lessee), during the time said secondary energy was generated. Such secondary energy will be disposed of by the United States subject only to the prior right thereto of the district and/or the lessees.

The director, among other powers, shall have authority to enforce rules and regulations promulgated by the Secretary in accordance with the Boulder Canyon project act, respecting operation and maintenance of the power plant and appurtenant works and structures.

Prior to the promulgation of any additional regulations, or the change or modification of regulations, the Secretary shall give any lessee and any allottee affected thereby, an opportunity to be heard.

V The following allocation of energy is made (the percentages stated being percentages of the total firm energy available) subject, however, to the conditions hereinafter stated: Of firm energy.

A. To the State of Nevada, for use in Nevada, not exceeding eighteen per centum (18%) of said total firm energy.

B. To the State of Arizona, for use in Arizona, not exceeding eighteen per centum (18%) of said total firm energy.

Should either of the States not take its full eighteen per centum (18%) allocation within a period of twenty (20) years hereof, the other may then contract for the energy not so taken up to four per centum (4%) of the total firm energy, provided that the combined amount used by the two States shall not, at any time, exceed thirtysix per centum (36%) of such total firm energy.

C. To the Metropolitan Water District of Southern California (hereinafter referred to as the district) so much energy as may be needed and used for pumping Colorado River water into and in its aqueduct for the use of such district within the following limits:

(1) Not exceeding thirty-six per centum (36%) of said total firm energy; plus

(2) All secondary energy developed at the Boulder Dam power plant as provided in these regulations; plus

(3) So much of the firm energy allocated to the States, the city and the company as may not be in use by them. Energy allocated to the States but not in use by them shall be released to the district by the two lessees equally (unless they agree upon a different ratio) as follows: (a) If the district makes a firm contract with the Secretary for

the balance of the lease period for part or all of such unused States energy (subject to the first right of the States thereto) such contract shall be made effective upon two years' written notice to the Secretary, and compensation to the lessees, respectively, for main trans

mission line property rendered idle; (6) If the district does not so make a firm contract for such

energy, then energy allocated to the States but not in use hy them shall be released to the district upon not less than fifteen (15) months' written notice to the Secretary and at such compensation as the district and

such lessees, respectively, may agree upon, to cover cost 15091233

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