PG&E also built the original 22 megawatt power station at the old 1926 Melones Dam, under a 40-year contract with the Oakdale and South San Joaquin Irrigation Districts. While the power company would be allowed to market and earn revenue on the hydroelectricity produced, it had to pay royalties since the dam was owned by the irrigation districts. This model proved useful for financing irrigation projects on the Stanislaus River; hydropower sales contributed greatly to repaying the bonds issued for construction. The irrigation districts again entered into a contract with PG&E when they built the much more ambitious Tri-Dam Project. Two of the reservoirs, Donnells and Beardsley, were to be built at high elevations ( and , respectively), affording huge hydroelectric potential. The 72 megawatt Donnell powerhouse and the 11 megawatt Beardsley powerhouse were built as part of the Tri-Dam Project, in addition to an 18 megawatt plant at the Tulloch Dam further downstream. An added benefit was that the Donnells and Beardsley dams regulate water flow down the Middle Fork, allowing more consistent power generation at the older Stanislaus Powerhouse.