Socioeconomic Workshop: 

Final Report and Next Steps

U.S. Department of the Interior

U.S. Geological Survey

p p

Helen Fairley (USGS)

TWG Meeting, Phoenix, AZ

March 15, 2010

Workshop Prospectus

 Proposed a two-phase approach to plan and 

conduct future socioeconomic studies:

 Phase I (first 3-5 years):

 Focus initially on updating market-based value studies

 Pl f i i i t di i f t Plan for more expansive socioeconomic studies in future 

years

 Phase II (next 4-10 years)

 Build additional capacity to conduct trade-off analyses

 Update information on non-use values

SE Workshop Objectives

Consistent with this phased approach, the 

objectives of the workshop were to:

1. Clarify overall socioeconomic program 

information needs in a general sense – studies to 

be conducted within a ten-year timeframe

2. Identify specific information needs to be 

addressed in Phase I (next 3-5 years)

3. Prioritize Phase I research 

SE Workshop (Dec. 2-3, 2009)

 Workshop attended by ~ 40 Participants: 

 ~16 TWG members

 several other AMWG members and DOI/DOE agency staff

 7 socioeconomic researchers

 4 independent experts

 3 GCMRC staff 3 GCMRC staff

 SA Executive Director

 Facilitated by Mary Orton Company, with assistance 

from Strategic Initiatives Inc. (Chuck Anders) 

Workshop Outline 

 Part 1: Presentations on past socioeconomic 

studies relevant to AMP

 Part 2: Facilitated discussion with AMP members 

(using decision support technology)

 identify priority socioeconomic needs identify priority socioeconomic needs

 distinguish/prioritize Phase 1 and Phase 2 studies 

 Part 3: Independent panel reviewed program 

needs; provided recommendations on next steps

 Part 4: Panel provides written report 

List of Presenters and Topics  Dr. Michael Welsh, Christensen and Associates, Madison: GCES NonUse Value Study

 Dr. John Duffield, University of Montana, Missoula: Economic Values for 

National Park System Resources within the Colorado River Basin

 Mr. Clayton Palmer, Western Area Power Administration, Salt Lake City: 

The Alchemy of Power Economics: Converting Watts to Dollars

 Dr. Thomas Veselka, Argonne National Laboratories, Chicago: Dr. Thomas Veselka, Argonne National Laboratories, Chicago: Estimating Estimating

Colorado River Storage Project Power Economics with the GTMax Model

 Mr. David Marcus, independent consultant, Berkeley: Glen Canyon Dam 

Releases – Economic Considerations

 Dr. David Harpman, Bureau of Reclamation, Denver: Integrative 

Recreation Economics Tool

 Dr. Yeon-Su Kim, Northern Arizona University, Flagstaff: Assessing 

Impacts of the LSSF Experiment on Regional Recreation Economics
Independent Panel Members

 Dr. Michael Hanemann, University of California, 

Berkeley

 Dr. Joel Hamilton, University of Idaho (Emeritus), 

Moscow

 Dr. John Loomis, Colorado State University, Fort 

Collins

 Dr. Lon Peters, Northwest Economic Research Inc., 

Portland

Economic Knowledge of Participants

Importance and Timing of Socioeconomic Questions

All Participants – December 2, 2009

Critical

Important

Phase 1

(Next 5 years)

Somewhat

Not very

Not at all

Phase 2

(After next 5 years)

Importance and Timing of Socioeconomic Questions

Official TWG Members – December 2, 2009

Critical

Important

Somewhat

Phase 1

(Next 5 years)

Not very

Not at all

Phase 2

(After next 5 years)

Highest Priority Questions/Needs

B. How do high flow and other experiments affect 

recreation (river rafting fishing guides and other 

associated businesses, including tribes)?

H. Having heard two distinct views, what is the value 

of hydropower capacity of GCD?

D. What are the points of disagreement on 

methodologies and assumptions in regard to power 

analysis?

W. Determine impacts on marketed hydropower and 

recreation values of alternative flow scenarios in 

real time to support decision making.

Recommendations from the Independent 

Panel (Final Report, February 26, 2010)

 Phase I

 Power flow modeling & studies (both economic & 

financial impacts)

 Surveys of recreational users

 Surveys of tribal interests

 Economic impact & economic benefit analysis for 

hydro & recreation

 Addresses questions: H, W (part), D, E, U, M, G 

(part), V, S, I, C (part)

 Start work on Identifying issues and questions for 

non-use value surveys
Recommendations from the Independent 

Panel (Final Report, February 26, 2010)

 Phase II

 Develop and test non-use surveys

 Conduct non-use surveys

 Focus on marginal non Focus on marginal non-use values due to changes in use values due to changes in

flows

 Addresses questions: T, Q, G (part), C (part), N

 Rationale: 

 Non-use survey too expensive for Phase I budget

 Non-use survey needs more precise scenarios

Phase 1: Recommendation Details

 Hydropower Analyses

Date Task(s) Responsible Parties

FY2010 Define GCD operational base case and change 

cases

GCMRC, with 

cooperation from WAPA

Solicit firms for WECC analysis (RFQ for 

engineering financial and economic analyses)

GCMRC, with 

engineering, financial, and economic analyses) cooperation from WAPA cooperation from WAPA

FY2011 Model WAPA’s system with changes in GCD 

operations; check flowgates between WAPA and 

rest of WECC; establish framework for economic 

and financial analyses

Consultant, with 

cooperation from WAPA

FY2012-

FY2013

Conduct economic and financial analyses, for 

WAPA and its customers and, if needed, WECC

Consultant, WAPA, 

GCMRC

Phase 1: Recommendations, cont.

 Economic Effects of Resource Use 

Date Task(s) Responsible 

Parties

FY2011 Define Economic Benefits and Use Preferences 

of Glen Canyon Anglers

GCMRC, with 

cooperation from AZGF

FY2011 Define Economic Benefits and Use Preferences 

of Day Rafters

GCMRC, with 

of Day Rafters cooperation from NPS cooperation from NPS

FY2012 Define Economic Benefits and Use 

Preferences of White Water Rafters in 

Grand Canyon National Park

GCMRC, with 

cooperation from 

NPS and GROA

FY2012 Define Economic Benefits and Use 

Preferences of Rafters below DC

GCMRC, with 

cooperation from 

NPS and Hualapai

Recommendations, cont.

 Tribal Values and Non-use Values

Date Task(s) Responsible 

Parties

FY2013 Survey tribal populations to assess social and 

economic impacts of changing dam operations

GCMRC, with 

p gg p cooperation from Tribes

FY2012 Begin scoping for Non-Use survey, initiate focus 

groups, design survey, seek OMB clearance

GCMRC, working with 

consultant

FY2013 Conduct Non-use survey GCMRC, working 

with consultant

Timelines and Estimated Costs

 Fiscal Year 2010: 

 Initiate RFQs for power models (consultants, universities). 

 No additional budget required if done by existing staff. 

 May be worthwhile for GCMRC to consider enlisting some 

additional socio-economic expertise to support this activity

 Fiscal Year 2011 Fiscal Year 2011

 Initiate recreation surveys of Glen Canyon anglers and dayuse rafters $50,000 - $100,000

 Identify tribes for specific surveys of preferences and 

attitudes $5,000

 Offer “Nonuse Values 101” to educate AMP on topic 

 Power modeling. Cost depends on whether there is a nonproprietary model of WECC; if not, cost to access to 

a proprietary model should be factored in.

Timelines and Estimated Costs

 Fiscal Year 2012

 Conduct power flow studies that show the financial and 

economic consequences of Glen Canyon management 

alternatives on WAPA, WAPA customers, and the Upper 

Basin Fund. $50,000 

 Recreation surveys continue - white water users including 

Diamond Creek to Mead rafters $100 000 Diamond Creek to Mead rafters $100,000 - $150 000 $150,000

 Prepare surveys of tribal preferences and attitudes $20,000

 Conduct focus groups and piloting of Non Use Value survey, and initiate OMB clearance. ($200,000) 

 Power modeling. Cost to be determined
Timelines and Estimated Costs

 Fiscal Year 2013

 Expand power flow studies to include financial and economic 

consequences of Glen Canyon management alternatives for the 

entire WECC. $100,000

 Recreation surveys continue – repeat coverage of Glen Canyon and 

day-use $150,000

 Conduct tribal surveys. $60,000

 Conduct full nonuse value survey$ , .500 000

 Fiscal Year 2014

 Develop “real-time decision-making spreadsheet” ($50,000 -

$100,000)

 Recreation surveys continue, repeating coverage of white water 

users $150,000

 Develop “real-time decision-making spreadsheet” ($50,000 -

$100,000)

 Recreation surveys continue, repeating coverage of white water 

users $150,000

Next Step

 TWG/AMWG guidance on prioritizing 

socioeconomic research in future budget cycles:

“[The need for additional economic analysis capacity] 

has been clearly identified as a priority by the Science has been clearly identified as a priority by the Science

Advisors and by previous NAS/NRC reviews of the 

program. However, it is currently not reflected in the 

AMWG priority questions or called for in the Monitoring 

and Research Plan.” (TWG 2010-11 budget notes)

Questions?