144 MULTIPLE PURPOSE RIVER DEVELOPMENT 



TABLE 20. Comparative Costs of Hells Canyon High Dam and Three Low 

 Dams, Assuming Federal Development and Imputed Interest Rate 

 of 2.5 Per Cent 



Alternatives ($ thousand) 



Item High Dam Three Low Dams 



Investment » 399,221 209,451 



Interest and amortization '' 10,898 5,720 



Interim replacements ■= 1,545 1,074 



Payment in lieu of state and local taxes'* , 1,999 1,047 



Operation and maintenance *■ 1,495 1,666 



Total average annual costs 15,937 9,507 



Increment of average annual costs of High 



Dam over three low dams 6,430 



* The investment figure was obtained as follows: For the High Dam — (1) con- 

 struction costs at site $310,740,000 (FPC, Stafj Brief, Table 14); (2) construction 

 costs for downstream generating capacity $58,707,000 (Witness Cotton's estimate, 

 ibid.. Appendix B, p. 35); (3) interest during construction at site for a six-year 

 construction period at 2.5 per cent, $23,306,000; (4) interest during construction 

 for downstream installation of generators for two-year construction period at 

 2.5 per cent interest, $1,468,000; and (5) estimated capital cost of facilities for 

 migratory fish of $5,000,000 {ibid.. Appendix B, Table 14). For the three low 

 dams — (1) construction costs at site of $183,941,000 (ibid.); (2) construction 

 cost for downstream generators of $13,862,000 (ibid., Witness Cotton's estimate 

 of capital costs, p. 31); (3) interest during construction at site for a 2.8-year 

 average construction period at 2.5 per cent, $6,438,000; (4) interest during con- 

 struction for installation of downstream generators, two-year construction period 

 at 2.5 per cent, $348,000; and (5) estimated capital cost of facilities for migratory 

 fish of $5 million. 



'' Interest at 25 per cent and amortization over 100 years. See Otto Eckstein, 

 Water Resources Development: The Economics of Project Evaluation (Cam- 

 bridge: Harvard University Press, 1958). 



•■ FPC Staff Brief, op. cit., .Appendix B, p. 87. 



" Ibid., Appendix B, p. 88. 



^ Ibid., Appendix B, pp. 89-90. 



Annual benefits will be accounted for predominately by power, 

 although flood control and navigation will contribute modestly to 

 the total. Power output from the development will vary, depending 

 on such factors as the time profile of storage capacity added at 

 different points to the system and the depletion of stream flows 

 associated with irrigation withdrawals upstream. The record thus 



