196 MULTIPLE PURPOSE RIVER DEVELOPMENT 



tion 11 as a device to get compensation through the medium of 

 another agency's decision to dispense with the requirements that 

 Alabama Power Company compensate the federal government for 

 headwater benefits from Allatoona. The fact that Section 11 is 

 phrased in terms of annual compensation in lieu of an appropria- 

 tion suggests that some parties instrumental in drafting the legisla- 

 tion may have considered this possibility. 



Be this as it may, it is not consistent with Mr. Weiss' testimony 

 that the development was being planned "without any burden 

 being imposed on the Federal Treasury," and it therefore remains 

 unclear whether the electric customers of Alabama Power Com- 

 pany, the Federal Government, or conceivably some other parties 

 will carry the burden of flood protection. Perhaps the question 

 will be answered by the terms of whatever federal license may be 

 issued. In any case, this is not primarily an issue of "efficiency," as 

 defined in Chapter II, but rather the co-ordinate consideration 

 "equity" which is involved when differences in policies have 

 different consequences for income distribution. 



Summary and Conclusions 



A review of the record in the case of the Alabama-Coosa deau- 

 thorizing legislation and Alabama Power Company's application 

 for license, along with economic analysis of the problems, suggests 

 several general conclusions. 



There is nothing in the physical characteristics of the Coosa — the 

 relation between the hydroelectric potential and the size of the 

 Alabama Power Company's system, nor in the locational relation- 

 ship between the federal project and the intended private develop- 

 ment — to prevent the efficient development of the Coosa under 

 private auspices. Furthermore, the legislation suspending authoriza- 

 tion of federal development of the Coosa for power provides for 

 the inclusion of nonmarketable project services, or "collective 

 goods," which normally would not be undertaken by private enter- 

 prise. All the necessary conditions, both physical and institutional, 

 for the development of a river basin in the most efficient manner 

 under private auspices, therefore, are present in the circumstances 

 surrounding the Alabama-Coosa. 



Still, not all of the information required to determine the most 



