HYDROELECTRIC POWER POTENTIAL AT THE AMISTAD SITE Article 7 of the 1944 water treaty provides: The Commission shall study, investigate and prepare plans for plants for generating hydroelectric energy which it may be feasible to construct at the international storage dams on the Rio Grande (Rio Bravo). The Commission shall report to the two Governments in a Minute the works which should be built, the estimated cost thereof, and the part of the works to be constructed by each Government. Each Government agrees to construct, through its Section of the Commission, such works as may be recommended by the Commission and approved by the two Governments. Both Governments, through their respective Sections of the Commission, shall operate and maintain jointly such hydroelectric plants. Each Government shall pay half the cost of the construction, operation and maintenance of such plants, and the energy generated shall be assigned to each country in like proportion. Studies by the U.S. Section of the Commission indicate that releases from the dam contemplated at the Amistad site could be made under a head of 138 feet or higher 80 percent of the time; and under a head of 104 feet or higher 90 percent of the time, and total releases for generation of energy for the United States are estimated to average 1,126,000 acre-feet annually. There is therefore the potential of large quantities of hydroelectric energy at the site. The Federal Power Commission reports that: The load growth within a reasonable transmission distance of the project will be more than adequate to absorb the capacity of a United States plant at the site. Power operation studies on the basis that development of power at a dam at the Amistad site would be entirely subordinate and incidental to operation for control and regulation of waters for domestic and irrigation purposes, and that one-half of the total quantity of waters released annually would be available to each country for generation of hydroelectric energy, indicate that (a) capacity would not be available 100 percent of the time due to water shortages; but that (b) capacity of 75,000 kilowatts or more would be available about 81 percent of the years, and a capacity of 100,000 kilowatts or more would be available 62 percent of the years; and (c) the total increase in energy that could be generated for the United States over that at Falcon Dam would average 133,000,000 kilowatt-hours annually. The Federal Power Commission, regional office, Fort Worth, Tex., reviewed the studies and advised by letter of April 1, 1958:1 Although it is indicated that the desired monthly energy output and a capacity of 75,000 kilowatts could be maintained for 30 consecutive years (1920-49), we cannot assign dependable capacity to the Diablo (now Amistad) plant due to the capacity and energy shortages cited for other years within the period of study. On the other hand, a utility might be willing to contract without too great a penalty, for power with an occasional shortage of capacity if sufficient advance notice of the impending shortage could be given. However, since the operation study indicates that capacity available will not meet the standard criteria utilized by this office in assigning dependable capacity-we have assumed that the dependable capacity of Diablo (now Amistad) would be zero in this case. 1 See app. I, p. 255. Our computations indicate that the at-site value of the Diablo energy under your power study DF-2 would be 1.7 mills per kilowatt hour***. The chairman, Federal Power Commission, Mr. Jerome K. Kuykendall, in his letter of December 16, 1958,2 commenting upon the project report, stated: The Federal Power Commission studies show that the economic feasibility of power development at the Diablo project is dependent in large measure upon the dependable capacity that can be credited to the development. If it is assumed that the power could be utilized on the area load in such a way that 75,000 kilowatts capacity might be considered dependable, the estimates indicate that the power benefits would exceed the power costs, including an allowance for taxes foregone, with a resulting benefit-cost ratio of about 1.1. If on the other hand, the plant could be credited with no dependable capacity, the benefit-cost ratio of the power development would be substantially below unity. In view of the conjectural nature of the capacity benefits, the Federal Power Commission is of the opinion that the construction of a powerplant at this dam by the Federal Government is not warranted at this time. It believes, however, that the project posesses important power potentialities that should be safeguarded. Accordingly, the Federal Power Commission concurs in the provisions for future power development at the Diablo project substantially as shown in the subject report. Comparison of costs of various capacity powerplants at the Amistad site with annual revenue at the value assigned by the Federal Power Commission of 1.7 mills per kilowatt-hour, indicates that construction of a plant by the Government would not be economically justified. The Central Power & Light Co. of Texas, however, advises in its letter of April 14, 1958,3 that with certain reservations: Central Power & Light Co. will construct, operate, and maintain a hydroelectric powerplant, together with the necessary tieline facilities, all of a size appropriate to the economic generation and transmission of power from Diablo Dam site. In consideration for the service of developing and maintaining head, and for providing falling water to this powerplant in a manner similar to that indicated in your study DF-2, we consider that payment averaging $337,000 per year will represent a fair value for the use of this water in the generation of power and energy at the Diablo site. On the basis of the offer of the Central Power & Light Co. of $337,000 annually plus an increase which a dam at the Amistad site would permit in revenue from power at Falcon Dam estimated at $3,000 annually, total potential benefits of hydroelectric power generation which would accrue to a dam at the Amistad site, are estimated to amount to $340,000 annually. 2 See app. II, p. 260. See app. I, p. 256. BENEFITS AND COSTS The primary and secondary benefits which would accrue to the United States from a dam at the Amistad site of the design contemplated, are summarized as follows: 1 Revised from amount shown in Project Report dated September 1958, S. Doc. No. 65, 86th Cong., 1st sess., to include more recent data. Comparison of the estimated annual benefits and costs to the United States are as follows on the basis of 50-year life: Primary benefits only-Flood control, conservation, and power. 1 $4,093, 000 896,000 4,989,000 1 Revised from amount shown in project report dated September 1958, S. Doc. No. 65, 86th Cong., 1st sess., to include more recent data. The proposed Amistad Dam and Reservoir is therefore found to be economically justified from the viewpoint of the United States. In addition there would be extensive indirect benefits, including increased trade and investment opportunities incident to the securing of properties against floods and firming of the water supply; added tax revenue to the local, county, State and Federal Governments; and during construction new jobs, opportunities, and income would be created by the multimillion expenditure for the dam and reservoir; all of which will enhance the welfare of the interests in the United States. There would be the important intangible benefit of safeguarding human life against river floods and attendant enhancement of the general welfare and security of the peoples bordering the river below the Amistad dam site, and reduction in the threat of epidemics caused by polluted domestic water supplies from the river. There would be the intangible benefit of fulfillment of the agreement reached by the United States and Mexico in the 1944 Water Treaty to construct jointly the dams required in the main channel of the Rio Grande for the conservation, storage, and regulation of the greatest quantity of the annual flow of the river. CONCLUSIONS ་ (a) There is urgent need from the viewpoint of the United States for a major international storage project on the Rio Grande upstream from Falcon Dam, as contemplated by the 1944 Water Treaty, to protect against loss of life and safeguard property in this country along the river from Del Rio, Tex., to the Gulf of Mexico against serious flood damages which, without additional flood control, are estimated to average $1,864,000 annually in the future, which figure is revised from amount shown in Project Report dated September 1958, Senate Document No. 65, 86th Congress, 1st session, to include more recent data. (b) The Amistad site, because of its strategic location below the confluences of the Pecos River and the Devils River, the sources of the greatest floods of history on the Rio Grande, is, as determined jointly by the United States and Mexican Sections of the Commission, the most suitable of the many studied for the second major international storage dam, from the standpoint both of flood control and conservation. (c) To achieve the optimum feasible control and regulation at the Amistad site, the total reservoir capacity required is 5,660,000 acrefeet, consisting of 2,110,000 acre-feet of flood control capacity as determined by the Commission, in which each country would have an undivided interest, and 3,550,000 acre-feet of conservation and silt capacity, of which the U.S. share, as determined by its Section of the Commission, would be 1,995,000 acre-feet. (d) The most appropriate general type of dam at the Amistad site, determined by the Commission, would consist of a gated concrete spillway channel section flanked by earth embankments. (e) The annual monetary value of direct benefits alone, that would be provided to the United States by the Amistad Dam and Reservoir, consisting of flood control, conservation, power production, recreation, and fish and wildlife resources, would exceed the U.S. share of the annual costs by a ratio of 2.4 to 1; U.S. participation with Mexico in construction of the project is therefore found economically justified. (f) In addition to the direct benefits, important indirect benefits, both tangible and intangible, would accrue to the United States as a result of construction of the Amistad Dam and Reservoir. (g) Had Amistad Dam been operable only since 1954, savings to the United States from flood control and prevention of waste of its waters would have exceeded the U.S. share of cost of the dam. That completes the formal presentation, Mr. Chairman. I shall be glad to answer any questions which the committee desires to ask. Mr. SELDEN. Thank you, Colonel Hewitt, for a very thorough statement. I am sure there are questions the members would like to ask you. Let me ask you this: Are the criteria used by the International Boundary and Water Commission in computing the cost-benefit ratio the same as that used by the U.S. Corps of Engineers? Colonel HEWITT. Substantially the same. Mr. SELDEN. In your statement-I believe it is on page 8-you point out that one of the items listed in the estimated costs in connection with this project is the land cost. How many acres do you estimate will have to be acquired in fee simple? Colonel HEWITT. It is the policy of the Commission, exactly the same as it is of the Corps, to acquire title to the property only up to the point in which that property will be inundated on the average of once every 5 years. We do not acquire title above that. We obtain flowage easements above that point. Mr. SELDEN. In connection with a project in my own district some years ago, the Department of the Army acquired fee simple title to land in excess of what was actually needed. Their policy was changed during the acquisition of the land, and I had to introduce a bill to allow those who had let their property go to repurchase it. So there has been changes in the Corps' policy over the years. Colonel HEWITT. There has been some change, Mr. Chairman. We also have run into that same problem in our original acquisition of property in the vicinity of Falcon, and have revested to the original owners desiring to have their property returned to them the excess properties acquired. Mr. SELDEN. Then the policy you intend to follow is to obtain fee simple title only to the property actually flooded, and flowage easements above that point? Colonel HEWITT. That is right. Mr. FASCELL. Is part of that policy to allow the fee simple titleholder to construct buildings, or allow any construction on the flowage easement? Colonel HEWITT. Above the ordinary flow line he could construct certain things, but that would only be down to the elevation which we would expect the reservoir would reach, rather infrequently. Mr. FASCELL. Do I understand by that that the Commission would obtain the flowage easements and would contract with the fee simple owner to prescribe the uses that he could make of his remainder? Colonel HEWITT. Let me tell you what we do in the case of Falcon at the present time: The ordinary maximum level which we expect to have the reservoir attain is elevation 307. Below 307 the Federal Government acquires fee simple title. Between 307 and 314 is the area in which we acquire a flowage easement, but in the area between 307 and 314 we do not restrict the owners of the property from building in that area. However, they build in the area with the full knowledge they may be flooded and we pay to the flowage easement. Do I make myself clear? Mr. FASCELL. Yes, sir. Now, somewhere I recall this plan contemplates the construction of five access roads to public rights along the Colonel HEWITT. That is in the supplemental report which is included in the report of the Commission in which the National Park Service indicated that it would be desirable to provide for the convenience and enjoyment of the public of the United States additional areas for recreational purposes. Mr. FASCELL. It is desirable but it is not contemplated, is that correct? Colonel HEWITT. Their report was included with ours and we naturally included it for the consideration of the committee. |