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Show benefits, largely in and near Rome, consist of flood damages prevented ($262,000) and enhancement of property values ($60,000). The anticipated revenue from the disposal of power is expected to cover fixed charges of interest and amortization of the investment over an assumed period of 50 years, the costs of replacement of items having an expected life of less than 50 years, and costs of operation, maintenance, and administra- tion. A three-year contract has been negotiated by the Department of the Interior with the Georgia Power Co. for the disposal of power from the Alla- toona Project. The revenues to be produced by the present rate will be about 1 million dollars a year, as compared with the Federal Power Com- mission's estimate of about 1.5 million dollars. However, since only two of the ultimate three main generators have been installed, the contract does not fully reflect the potential capacity value in the project. A special problem prevails in the Alabama-Coosa River Basin with respect to project benefits and re- payment because of the private power develop- ments. The recently completed Allatoona Project will regulate stream flow at three downstream power plants of the Alabama Power Co., and will improve materially the river flow during low periods. The existing Lay plant, with an installation of 64,800- kilowatt capacity, has a continuous power output at low flow of only 7,000 kilowatts. The Mitchell and Jordan plants have installations of 72,500 and 100,000 kilowatts capacity and corresponding out- puts at low flow of 6,900 and 9,700 kilowatts re- spectively. The Corps of Engineers estimated that the annual output of these plants will be increased in value by some $441,000 from flow regulation provided at Allatoona. Benefits to other projects, both private and Fed- eral, which may be built downstream will be cor- respondingly increased. Considerable value from the Allatoona Project will be derived from down- stream benefits. These benefits are direct and tangible. Section 10 (f) of the Federal Power Act2 pro- vides machinery for assessing downstream plants for the benefits derived. Allatoona Reservoir started operation in early 1950 and insufficient time has elapsed since then to permit reliable estimates of *Act of June 10, 1920, § 10, 41 Stat. 1063, 1068, 16 U. S. C. 803 Cf). the benefits. This assessment will be made by April 1952. Construction of the Howell Mill Shoals project, already authorized and next in line for construction, will provide substantial additional benefits to these private power plants. Projects Authorized but Not Under Construction Five authorized projects with a total estimated cost of 116.3 million dollars (1949 prices), all Fed- eral, are now included in the initial stage of de- velopment. These are: a navigation lock and dam and two power dams with locks on the Ala- bama River below Montgomery; a power dam with provision for a future lock on the Coosa River; and a modern 9-foot barge channel to Montgomery. Based on 1949 construction cost levels, the annual carrying charges for this first-step development, in- cluding interest and amortization, aggregate 5.9 million dollars. Combined annual benefits are esti- mated at 8.5 million dollars with a resulting benefit-cost ratio of 1.44 to 1. Of these annual benefits, power value is estimated at 7 million dol- lars, and annual transportation savings on 442,000 tons of expected water-borne traffic are estimated at 1.5 million dollars. Repayment of a substantial part of the construc- tion cost of these projects can be expected inasmuch as they will add 200,000 to 300,000 kilowatts to the installed power capacity of the basin. Approved Projects to Complete the Basin-Wide Plan The plan of the Corps of Engineers, as now en- visioned, contemplates the possible provision of 3 navigation-power dams on the Coosa, a flight of locks in each of the existing power dams on that stream and in the Howell Mill Shoals Dam, 20 power and storage dams on the Tallapoosa and tributary streams, additional power capacity of about 950,000 kilowatts, a 9-foot navigation chan- nel to Rome, Ga., and some local flood control measures. Based on 1949 construction costs, the total estimated cost of approved projects is 529 million dollars, of which 487 million dollars is Federal and 42 million dollars is non-Federal. 544 |
