Market Mechanics 65 



present purpose of simple illustration. It is possible, however, to 

 show the direct interdependence among units of a multiple pur- 

 pose system designed for flood control, navigation, and power, in 

 which most of the hydroelectric sites on the river have been de- 

 veloped. Table 2 lays this out for a system operated to maximize 

 output under two constraints — minimum channel depths for navi- 

 gation and a specified level of flood control at the focal point for 

 the flood control operations. This represents an integrated opera- 

 tion of two fiscally independent systems^* — the Aluminum Com- 

 pany of America and the Tennessee Valley Authority — under the 

 direction of a single management unit. The TVA is responsible 

 for co-ordinating storage releases so as to maximize system output 

 over the critical period, subject to the legal constraints with respect 

 to navigation and flood control. ^^ 



Both the columns and the rows of Table 2 have for their heading 

 the names of the hydroelectric plants in the Tennessee River and 

 tributary system. At the top of each column, under the correspond- 

 ing power plant, is shown the prime power equivalent, discounting 

 the contribution of upstream plants in the system. At the bottom 

 of each column is the actual prime power associated with the plant, 

 taking into accoimt the contribution of upstream storage to pri- 

 mary power at the downstream plant. The differences between the 

 two indicate the effects of the direct interdependence. 



The rows reveal the contribution which each plant provides to 

 downstream plants shown in successive cohmins moving to the 

 right, and finally the at-site primary power revealed by the last 

 entry in the row. Beginning with row one, for example, the one 

 entry indicates that there are no downstream plants below Ken- 

 tucky Dam. The single entry indicates the at-site primary power 

 equivalent without the effects from upstream plants. Row two. 



^* The Aluminum Company of America's system of five hydroelectric plants 

 on the East Tennessee and North Carolina tributaries of the Tennessee River, 

 and the Tennessee Valley Authority's system of twenty-eight dams on the main 

 stem and tributaries of the Tennessee River. 



^ In addition to the contribution of Alcoa's storage to downstream generation 

 of the TVA hydroelectric plants, there are net increments to generation available 

 from operating the fiscally independent systems as a hydraulically and elec- 

 trically integrated system. From such co-ordinated management, there results 

 some 22,000 kilowatts of additional dependable generation, which by agreement 

 is shared equally between the parties. 



