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Show provisions for preference sales which would permit approval of the Nebraska request. A further provision of existing law is the sale at the lowest possible rates to consumers consistent with sound business principles. It may be implied that the provision for sale "at the lowest possible rates" envisages sale with the minimum transmis- sion and distribution costs. Other things being equal, the cost at load centers in South Dakota of power from Fort Randall would be less than the cost at load centers in Nebraska. Such an inter- pretation would, of course, be most completely car- ried out by sale to industry at the site, which would be obviously in conflict with the fundamental pur- pose of Federal power policy. Another important provision of present legisla- tion is to market power to promote its "most wide- spread use." Would the sale of the power to pref- erence customers in Nebraska, possibly by the vir- tual exclusion of nonpreference customers in South Dakota, meet this provision? Quite apart from these questions is that of the wisdom of arbitrarily limiting the amount of power to be marketed outside the State in which a Corps of Engineers project is located. Such legislation would run counter to the principles of river basin development. It would ignore the advantages of treating an entire river basin as a unit. The provi- sions of thie bill would greatly circumscribe and complicate the sale of power, making it impossible to meet the needs for power, or to achieve the po- tential economies of power generation, transmis- sion, and distribution. Conclusions The objectives of river basin programs include the basin-wide use of water resources in contrast to the narrow view which considers only the indi- vidual project. Marketing of power should be pred- icated upon the basin principle. Any procedure or legislation which would ar- bitrarily limit the disposal of power in accordance with political boundaries violates this principle. Consideration should be given in the Missouri Basin and closely related areas to provisions of es- tablished Federal policy and of legislation thereto prescribing the widespread disposition of power, at the lowest possible rates to the ultimate con- sumer consistent with sound business principles, no less than to other provisions of Federal policy, including those relating to preferential customers. Consideration should be given to the question as to whether or not the widespread use of Federal power should envision use by all classes of cus- tomers, regardless of the ownership of the distribu- tion facilities. In any event where other things are equal as to widespread use and sale at the lowest possible rates, and choice must be made between preference customers and nonpreference customers, sale should be made to the preference distributor. 7. Rate of Power Development and Integration with Navigation and Other Purposes The Problem What is the proper rate of power development and how are plans for hydroelectric power linked with those for navigation and other purposes? The Situation Although agriculture and the marketing and processing of farm products constitute the prin- cipal economic activities in the basin and contiguous areas, manufacturing is of considerable importance in the lower basin area and has been expanding in recent years. There are possibilities of further ex- pansion throughout the basin. Power market studies indicate that the electric power demand of utility systems in the general basin area 43 will increase from the 3,556,000 kilowatts produced in 1949 to 8,226,000 kilowatts in 1970, a growth of 4,670,000 kilowatts. (See figure 6.) In 1949 the total installed generating capacity of electric utility systems in the market area amounted to 4,199,000 kilowatts, consisting of 797,- 000 kilowatts in hydroelectric plants and 3,402,000 kilowatts in fuel-electric plants. Taking into ac- count retirements of existing capacity and allowing for a reasonable operating reserve, it is estimated that approximately 6.6 million kilowatts of new de- pendable capacity will be required to meet demands in the basin in 1970. The total hydroelectric power capacity at Fed- eral projects authorized for the basin amounts to about 2.5 million kilowatts. All of these projects will be in the upstream part of the basin and can supply a large part of the load growth in that area. The most economic utilization of the potential a Power market data given in this discussion are for 620,000 square miles in the Missouri Basin and con- tiguous areas, of which about 530,000 square miles are in the basin proper. 254 |