Industries Administration and Compliance
Headwater Benefits Costs
The annual interest, depreciation and maintenance costs of the headwater project facilities that provide downstream power benefits constitute Section 10(f) costs. The headwater project owner, such as the Army Corps of Engineers (or Bureau of Reclamation in the case of federal projects) generally provides these costs and allocations. The Commission uses the 10(f) costs in conjunction with the energy gains received at downstream hydropower projects to determine the Section 10(f) assessment, which is apportioned among all downstream hydropower beneficiaries. The figure below shows the typical distribution of headwater project costs. Only those costs identified as attributable to joint-use power facilities are included in the allocation formula.