It should be borne in mind that the Bureau of Reclamation is not entirely objective when it comes to water use tradeoffs across the Colorado River system. By the late 1960s, after all of the good dam sites and economically viable water projects had been built, the BOR had to find a new business model to keep building dams that would pass congressional scrutiny on a cost-benefit basis. Since most of the remaining projects they had on the books would cost more money to build and operate than they would ever return in economic benefits, this was a problem. To get around it, the Bureau started bundling dams into multi-facility “projects”, where the revenues from big hydro dams, known as “cash register dams,” would offset the losses from all the other non-viable projects in the batch.
Glen Canyon dam was one of a triad of such “cash register” dams proposed along the main stem of the Colorado, the other two being in the Grand Canyon, at Marble Canyon and Bridge Canyon. As such, it was the fiscal cornerstone of the Colorado River Storage Project, which also included other dams in Colorado, Utah and Wyoming. The public opposition to the Grand Canyon dams, and the Carter administration’s sharp fiscal critique of additional dams proposed for construction in the 1970s effectively ended the BOR building spree that had commenced in the 1930s, because there were no more sources of potential revenue to offset the losses from dams of dubious economic benefit. However, the Bureau was still left with a situation in which if the big dams did not continue to produce hydropower revenue, the entire BOR system would start to run at a fiscal loss.
Given this history, it is not surprising that the BOR is insisting on maintaining hydropower generation at Lake Powell, even if it comes at the expense of agriculture in the Lower Basin, and even though a variety of other options are now available that would take up the slack in the grid. The BOR basically painted itself into this corner decades ago, and its current priorities reflect the business model it adopted at that time. By contrast, Hoover Dam was built far earlier, in the 1930s, and a loss of hydro there comes with no such similar contingent liabilities (which is not to say it would not have impacts). So the BOR has basically taken the position that it will defend its potentially flawed business model unilaterally, whether the states in the Colorado River basin like it or not. The real question here is whether it is the states that need to reform their past practices, or the BOR.