Comparison of the Arizona Power Authority and USBR Proposed Plan of Development for the Marble Canyon Project

Document: Comparison of the Arizona Power Authority and USBR Proposed Plan of Development for the Marble Canyon Project, 1963, author unknownComparison of the Arizona Power Authority and USBR Proposed Plan of Development for the Marble Canyon Project Based on information available in this office, it appers that the APA proposal contemplates Marble Canyon Dam and Powerplant with 510,000 installed kilowatts at an estimated cost of $154 million. Based on Bureau of Reclamation standards, we believe the $154 million is highly understated. USBR studies of the Marble Canyon Project are not comparable, because the reconnaissance studies on this project assume integration with the Central Arizona Project with a large proportion of the energy being used for project pumping purposes. These studies, however, indicate a cost of $198,300,000 for a 440-megawatt plant at Marble Canyon and $275 million for a 700-megawatt plant at the same site. Accordingly, a mathematical comparison of the two proposals would not provide meaningful answers. To indicate the significance of the difference in an interest rate of 4-1/2 percent (the approximate rate available to APA) and 2-7/8 percent (Federal rate), the following comparison based on a 50-year amortization period and an initial investment of $100 million is provided: 4.5% Interest--50-Yr. Period--2-7/8% Interest Investment $100,000,000 $100,000,000 Annual Payment 5,060,000 3,795,000 Total Payment in 50 Yrs. 253,010,000 189,750,000 Less Initial Investment 100,000,000 100,000,000 Total Interest Paid $153,010,000 $89,750,000 Difference $63,260,000Epson Perfection 4870 Photo, 400 dpi, 8 bit, byte