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Mr. HARWELL. No, sir; no expressed opposition.

Mr. O'NEAL. Is it contemplated that the distribution of this power will be handled, as far as practicable, by the existing power distributing agencies?

Mr. HarWELL. I am unable to make that statement, because, as I explained a moment ago, from the water users' point of view, whatever disposition of it is made or recommended by the Bureau of Reclamation, which will be in charge of the enterprise, will be satisfactory to us. We do not care to attempt to restrict the operations of the Bureau by offering our ideas in that respect.

The annual operating cost is made up of the items of interest and amortization at 3.89 percent, that is, interest at 3 percent and amortize the plant over a 50-year period; the power house, transmission line, substation maintenance, operation, and depreciation at 1.3 percent will give a total annual operating cost of $205,850, or a cost per kilowatt-hour of energy generated of approximately 24 mills, and a cost per kilowatt-hour delivered of something like 2.6 mills.

Mr. ScrUGHAM. Have you taken into account the amortization charge in calculating that figure?

Mr. HARWELL. Yes, sir.
Mr. SCRUGHAM. What will be the installed cost per kilowatt-hour?
Mr. HaRWELL. Three units of 8,000 kv-a each, is to be installed.

Mr. ScrUGHAM. That is, the installed capacity would be approximately 24,000 kv-a. What would be the firm horsepower, the firm kilowatts, that would be delivered at the plant?

Mr. HARWELL. On an annual basis, 80,000,000 kilowatt-hours,
Mr. ScrUGHAM. I would rather have it on the basis of steady output.

Mr. HARWELL. I think I can find it for you in the record. One unit is a reserve unit, and the other two units are operating.

Mr. SCRUGHAM. I have roughly figured it by mental arithmetic as being 10,000 firm kilowatts.

Mr. Page. It is a little higher than that, Mr. Scrugham. It would be about 12,000 kilowatts.

Mr. SCRUGHAM. That was based on the 80,000,000 kilowatt-hours estimate, and the load factor would probably be 55 percent. On that basis, that would give you an installed cost of somewhere in the neighborhood of $215 per installed firm kilowatt, I should say. Are there any further questions?

Mr. HARWELL. Mr. Chairman, in about 1 minute more, I think I can complete the engineering set-up on this project.


On the basis of serving the Silver City, N. Mex., are by building a transmission line there as well as to the El Paso area, a cost of something like 3% mills would be incurred per kilowatt-hour by reason of having, you might say, duplicate transmission lines.

At the Caballo Dam itself there is a possibility that additional seasonal or intermittent power may be developed to the extent of some 14,000,000 kilowatt-hours by the installation of a plant there. The cost of the Cabello plant would be in the neighborhood of $925,000 and this added charge would bring the cost up to around 4.6 mills per kilowatt-hour for that particular power.


BUTTE DAM Now, the point that I wish to stress is this: Throughout the period of nonuse of Elephant Butte Dam for power generate tainly there has been a wastage of natural resources, as I said, ". extent of some $9,000,000, which almost equals the total ai r in the Rio Grande project. We water users feel that to stanu és is and countenance this waste is an offense, not only against the munity, but an offense against the country as a whole. The that flows, or, rather, is encompassed within the released water it is hrough the gates, is gone forever, and nobody can rerosa Coal or fuel oils or other sources of energy, or even natuni subject to storage and later use when necessary.


We have been helped along toward the securing of this deseruer by the Public Works Administration in making a $1,000,000 at a which, as I said, must be repaid from the power returns. Te according to engineering reports referred to, which are very mur o I am quite sure, is at hand when this development should m ea because the situation does not improve with delay.

To the gentleman who questioned me about competing with m e interest, this is the logical time for these developments to a s because industry is expanding all the time, and if we do not f or some point or other, and take up the slack, why, it is obvious thus su will wait forever hoping to get hydroelectric power developmeo: S avoid the losses which I have mentioned.

Thank you, gentleman.

Mr. FITZPATRICK. I was not here when you started your testNCE but did you explain to the committee how the $9,000,000 vus

Mr. HARWELL. The $9,000,000 in energy was lost by simply S through the gates of the dam in the form of water without ito tion for power.

Mr. FitzPATRICK. Can you explain just how you figum » $9,000,000?

Mr. Harwell. I figured the theoretical kilowatt-bour which you could generate from the released water, and stated in the meantime, the surrounding community has used meer that amount of electrical energy annually. So, the energy free water has been lost, and the energy has been supplied frue sur fuels to replace that loss.

Mr. FITZPATRICK. That has been happening all over the mere as to water power energy being lost, has it not?

Mr. HARWELL. In the beginning I stated in the case of the Parts Butte Dam provision was made for the generation of this post : at the time the dam was built, and the installation was crian and it is not a question of building a new structure to use the por that might result from harnessing a river. It is a matter of a a power dam, something that is already to be hooked up, and was expected to be hooked up to a power plant in the very begins

Mr. SORUNAM. Thank you, Mr. Harwell. Does that car. your statement?

^Ir. Harwell. Yes; thank you.

^at. Dempsey. Mr. N. B. Phillips, manager of the Elephant Butte

station district.


^<Ir. Phillips. Mr. Chairman and gentlemen of the committee, my :xne is N. B. Phillips, and I am manager of the Elephant Butte

-igation district, at Las Cruces, N. Mex. My district comprises the

L3av Mexico portion of the Federal Rio Grande project. 1 wish to state that I confirm all of the statements made here by T. Harwell, and I only desire to take up a few moments of the

• Tnmittee's time. I think it would be well to stress this point: That all of the figures

».ci estimates given by Mr. Harwell which advocate the development ■this hydroelectric energy at Elephant Butte have been taken from a

3ry comprehensive and technical report compiled for the Bureau of

reclamation by Mr. Cove and the cost of this report, the water users

f the district have agreed to pay for.


The water users in the district, I assure you, have no desire or any ntention to have power developed as a menace to existing companies ^hich are now in the field.

In connection with other developments of a similar nature, and -eferring to the report of Mr. Cone to the Bureau of Reclamation, and as an illustration of showing that there has apparently been no designs or any attitude on the part of the Bureau to destroy electric companies serving in the various territories, on page 18 of the report .t is indicated that there are four power companies on other reclamation projects throughout the country which have effected a contract for the purchase of hydroelectric power on Federal reclamation projects, and they are now receiving that power.

It is my opinion that the best way to supplement funds and to get allotment of funds to the Bureau is to say to the Congress and to the people generally over the country that the reclamation projects do pay out. On our particular project, up until the time of the crash in 1929, we maintained a record of paying 100 percent of our charges and of paying these charges on time.

This proposed power development, according to the figures of the Cone report, and which have been concurred in by the Bureau, indicates that the plan of development is sound. It indicates that it is sound financially, and that there is available a market to take care of this power.

Mr. O'neal. May I ask you a question there: Do you mean that the record was 100 percent for paying only the water rentals, or was it 100 percent for paying water rentals plus a proportionate cost of the amortization?

Mr. Phillips. It was 100 percent on all repayments, both construction, operation, and maintenance.

Mr. Fitzpatrick. I would like to ask you a question which I have asked all of the other witnesses that appeared before the committee: Assuming that these are self-liquidating projects, why cannot t States raise the money to complete them?

You say you want to assure the people of this country that it i self-liquidating and that it is self-paying. Why could you not ski that to the people of the States and have the States finance projpi of this kind?

Mr. Phillips. Well, personally, I do not think that the Bureau Reclamation would care to relinquish their equities in power deveioj ment to the States or to anyone else. I think it would be much ma desirable for the Bureau, who already have a construction investma in the project, to be in control, if you please, of the power developffi&i

Mr. Fitzpatrick. Before they had any interest in it, when ju first made your application, did your State feel the same Tot t that time? If they did, it was not necessary to appeal to the Men Government. You could have gone ahead and done it yourself.

Mr. Phillips. That was done a long time ago, sir; 20 years ago. 1 cannot say what the attitude of my State was at that time.

Mr. Fitzpatrick. You know, we hear so much about those projo; going to be self-liquidating and return the money to the Fe<ta. Government, and they are purely State matters. Of course, I we* that where the Government has started in on a case like this, is is i little different, but there are new projects that are now being advociK by the States, and that are entirely within the States. If tbeTiself-liuqidating so soon, why could not the States do it instead going to the Federal Government for funds?


Mr. Phillips. To further answer your question in this partiett case, sir, this is not only an interstate project, but it is also an intf national project, and it would be mighty hard, I believe, to get ^* Federal Government, who are interested in the delivery oi ffflttfB Mexico, and the States of Texas and New Mexico together w> practical basis for development. I believe it would be impossibl? t» secure development of power on our project by the States.

At the same time, I believe that if this development is underUiS that it will not only serve to repay the cost of development but also1' relieve the settlers on the project of a part of the construction co& It will also put the Government itself in a much more secure positif to realize on its investment in the project because it is really, after11 a more dependable source of revenue than if the Government «* entirely dependent upon the production of crops and the commodi^ prices which may prevail for those crops, and I think also that: would conform to the administration's power policy, as it is general understood. ...

I believe, too, that the Bureau recognizes, in the event oiu* development, that an equitable proportion of the costs of the EM8-1 Butte Dam, which is the principal feature in connection with ts power development, could be and should be absorbed in the p?*° project and paid for from power revenues, a proportionate credit^ be allowed the water users on the construction costs of the Img*"0 project. ...

Mr. O'neal. Have you any figures, Mr. Phillips, on thecost>oim transmission lines and that sort of thing?

Mr. Phillips. That, sir, is all set forth in detail in the Cone report.

Mr. Fitzpatrick. Will this reclamation project bring any new ,nd into production?

Mr. Phillips. No. No new land can possibly be brought in on le Rio Grande project. The reason for this is that the storage in le Elephant Butte Dam limits the safe annual water supply for the ireage in the project.

Mr. Fitzpatrick. When you say the acreage in the project, do you. lean the acreage there now producing?

Mr. Phillips. The acreage now producing is 90 percent of the* jreage in the project.

Mr. Fitzpatrick. Then it will put about 10 percent more in, will; , not?

Mr. Phillips. No, sir; the power development will not. It islst a matter of the other 10 percent coming into cultivation, by jclaiming the land and getting it ready for production.

Mr. Fitzpatrick. Since this reclamation project started, how many cres have been placed under production?

Mr. Phillips. The contemplated gross acreage in the project at he time it was started and the contract liability which the water sers have agreed to repay to the Government were based on 155,000 cres, and we have had under cultivation approximately 142,000 acress the maximum.

Mr. Fitzpatrick. Does that include both States?

Mr. Phillips. Both States; yes, sir.

I am sure that the committee already has given me as much time is I require, and I appreciate the opportunity of appearing before you.

As I said in the beginning, I wish to concur in the general statement* nade by Mr. Harwell, and also feel that the Cone report is a very mportant piece of evidence in connection with the deliberations of he committee.

Mr. Scrugham. Are there any others who desire to make statements, Mr. Thomason?

Mr. Thomason. Yes; we have one more statement, and then two rary brief witnesses. There has been so much interest on the part of he people of that section in this hydroelectric development that I 'hould say some 15 or 20 towns in and near that project, including Las Cruces, N. Mex., and El Paso, Tex., together with resprescntatives of the farmers and mining interests, met and organized what they were pleased to term a "power league" to aid in the development of this power which is now going to waste, and to that end, they elected Mr. A. W. Norcop, of El Paso, Tex., as president, who is present as their representative, and we should like to have him heard at this time.

Mr. Scrugham. We will be glad to hear Mr. Norcop's statement.


Mr. Norcop. Mr. Chairman and gentlemen of the committee, I shall try to be as brief as possible. I appear here as the direct representative of the municipalities of El Paso, Tex., and Hot Springs, V Mex., and Las Cruces, N. Mex., as well as the organization that Mr. 1 homason has mentioned, the Elephant Butte Power League, which

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