ernmental mechanism best calculated to achieve this end. There can be no doubt that this bill correctly identifies the central problem— the need for decisions regarding power supply to be made on a regional basis. In the face of continuing voltage reductions and possible brownouts this summer and in the wake of one major blackout, past patterns of high costs based on low efficiencies, a relatively low level of environmental concern, and a long period of blind opposition to the beneficial competition of such projects as Dickey-Lincoln, it is clear that the regional public interest has been underrepresented in the decisionmaking of the power companies.

At the same time, it is important that we note that the power companies themselves have recognized this need and have begun to regionalize their planning and operations. Undoubtedly the spur of Dickey-Lincoln and the elimination of oil import quotas have also been factors, but a forthcoming New England Region Commission study clearly shows that the New England consumer is now the beneficiary of a more regional power network at rates closer to the national average than was the case 10 years ago.

However, to assure a secure supply at the lowest possible price with minimum damage to the environment, much remains to be done. In outlining areas of particular concern to Maine and northern New England, we have heard a discussion of the supply problems by Governor Sargent. Suffice it to say that present projections are that New England's power needs will quadruple by 1990, with an attendant need for new generating and transmission facilities.

The issues involved in this extraordinary increase in demand are too important to be left to the presently large voluntary system of regional planning. The forthcoming study that I mentioned earlier indicates that the New England power pool, and I quote, "can only be an interim solution". The difficulties cited are pretty inherent and partly external. The inherent difficulties are that NEPOOL, even as it becomes something more than an advertisement, which is all it is today, has little actual authority over its members and that, by virtue of its limited membership, it is unlikely to give impartial consideration to the possible benefits of Dickey-Lincoln or other public power projects which might be justified by present or future demands. The external problem is primarily that NEPOOL has no power to coordinate divergent State regulatory laws. Furthermore, there is no particular incentive for NEPOOL to consider environmental factors. Nationally, the utilities have devoted only threetenths of 1 percent of their gross revenues to research despite the growing urgency of the environmental crisis. This can be a critical omission when, as is presently the case with Maine Yankee's Wiscasset plant, the residents of the area must bear the initial risk that a 25-degree rise in temperature will harm Montsweag Bay despite a recent Federal order limiting powerplants on the Great Lakes to a 1-degree rise for environmental reasons.

It is this gap between local problems, regional planning, and regional authority which your bill seems to me to begin to close. The efficiencies which might be achieved through a powerful regional regulatory body might more rapidly cure the splintered structure which has, along with high fuel costs and the absence of competition from

public power, saddled New England with the highest regional power costs in the Nation. These costs, coupled with insecurity of supply in some areas, are not only a burden to the homeowner but a deterrent to many forms of new industry which Maine badly needs.

It is, I believe, time that we stop searching for scapegoats for the regions' past power problems and recognize, as your bill does, that the overwhelming future needs dwarf our past experience. The forthcoming commission study suggests various possible regional organizations and regional generation and transmission systems. One of those recommended organizations is similar to that created by your bill and would be adequate to assure the implementation of the necessary generation and distribution systems at the lowest possible cost. Only in this way can the remaining difference of six-tenths of a cent per kilowatt hour between New England and the rest of the Nation be eliminated.

Before concluding, I should point out one reservation which I have regarding this legislation in its present form. Specifically, I am not sure whether it gives the Federal agency the power to override a determination which the Maine Environmental Improvement Commission might make under our new site approval law. It seems to me that it would be desirable to make clear, as your recently enacted Water Quality Act does, that Federal standards should serve as a minimum and that individual States might enact more stringent environmental requirements. In this same vein, it might be desirable to place more authority in the regional board to act against a background of federally approved minimum standards. This step would assure that S. 2752 would be a true step toward regionalization rather than federalization.

In conclusion, let me commend you for again having taken a progressive stand in that delicate area in which consumer and environmental needs collide. Without unduly interfering in industrial decisionmaking, your bill clearly recognizes that power problems and solutions are matters of multistate concern, that an industry set up on a regional pattern should be regulated on a regional basis and that power generation, transmission, and distribution must be a public utility in fact as well as in name. Thank you.

Senator MUSKIE. Thank you very much, Governor, for your excellent statement. May I point out in connection with the Dickey-Lincoln School, apparently what appears to be a lack of reserves in New England to meet even this summer's requirements. If Dickey-Lincoln School, since its organization in 1964, 1965, had been without the opposition of the private utilities, that it has had to face in New England, and stimulated by the private utilities all over this country, we might have had the project authorized and well underway at this point, and on the line in time to help these same private utilities meet power requirements that they apparently are unable to meet with their present reserves and present generating capacities. Moreover, it would have been constructed during a time when construction costs would have been much less, these costs they too, have to meet in the 1970's to build additional capacities. I think it is highly appropriate, since this hearing is being held in Boston, that this point be made.

I think New England's interests have not been served by this opposi

tion. I am delighted to have the opportunity to say so here today and now at this place.

Governor CURTIS. You know, Senator, we have never argued that we should not have existence of private power utilities in our State, simply that they were underestimating future power needs. Now they are admitting these statements we have been making for so many years were correct. It seems to me that in face of this they would stop opposing our attempts to create a Maine Public Power Authority Commission to work in concert with them, but you know they are not.

Senator MUSKIE. When it comes to power, power is their business, they feel they, and they alone, know how to provide the capacity, how it should be distributed and know enough about it to understand what is involved. I think that this legislation before us, and even the change in attitudes or changing attitudes in the industry, reflect an understanding or a growing awareness, at least, that it is the public's business as well.

In the concluding paragraphs of your statement, Governor, you referred to a reservation which you had about pending legislation in its present form. You say, "Specifically, I am not sure whether it gives the Federal agency the power to override a determination which the Maine Environmental Improvement Commission might make under our new site approval law." I will refer you to section 5 (a) of the bill on page 8 to reassure you on this point.

Section 5(a) says this: Within 12 months after the enactment of this act, the agency shall promulgate, and distribute to the regional boards, after consultation with other interested governmental agencies and utility regulatory commissions, criteria for the development of procedures for the siting and construction of bulk power facilities to assure compliance with-and then there are some eight points of compliance which the bill refers to, and paragraphs (4) and (5) read as follows: Standards of adequacy and reliability of power supply as developed pursuant to section 6 of this act; applicable regional, State, metropolitan area, and, where appropriate, local economic and land use plans, including plans for optimum and multipurpose use of rightsof-way.

I think that language would cover the point you made. Whether or not it does technically, it does indicate our intention.

Governor CURTIS. Yes; I think so.

Senator MUSKIE. That the States be given this kind of a role under the procedures and arrangements contemplated by the bill.

Governor CURTIS. That was really the purpose of my reservation, simply to make sure that every stone is turned, not to have what has happened, as you know, in some other environmental areas, that they are able to weasel out on Federal regulations rather than the adopted State regulations.

Senator MUSKIE. I was glad you made the point because it enabled us to clear the record and to eliminate any doubts perhaps others may have had.

May I ask one or two questions about power and economic growth in New England, since you have Mr. Feehan with you? New England has constantly lacked an abundance of power to attract big industry, plus the fact that its power rates are the highest in the country. We

have already had testimony this morning that emphasized that point. In addition, private utilities making up the source of New England power have adopted a strong policy of holding what power it makes and opposing any competitive power expansion, including the purchase of cheaper power from the outside.

What is your judgment, Governor or Mr. Feehan, has been the economic effect of the New England power situation in the past and what would it be in the immediate future and long-term future? How critical is the power situation, in other words, to New England's and Maine's economic growth? And could you in answering that perhaps give us some impression of what you think we have lost in economic potential due to limited capacity and high power rates?

Mr. FEEHAN. I suppose in answer to that question, Senator, historically we have always had the argument or the proposal which you might say is the question, which comes first, the chicken or the egg?

I know that presently it is the utilities' argument that before the substantial investments should be made in new generation or transmission sites, that there must be something more than expectation that industry is moving into a particular location. I honestly feel myself in the association that I have had in the regulatory aspects of this, that the thinking is somewhat conservative, that there should have been more generating and transmission sites available to attract industry into the area.

We in Maine look forward to our recent intertie with Canada and hope that the future will afford us Canadian power at a price attractable to industry to move in in the future. We look to this transmission line, which will become operational in the fall of this year, to be very beneficial to the State of Maine. It will now place us in the middle of this so-called power group rather than being at the extreme end, which we have been to date.

The State of Maine does not have large generating facilities of the nature we are talking about today. We know that we are forced into the regional approach and we think it would be a healthy situation as long as your bill or a bill similar to your intent is enacted in order that there will be sufficient regional regulatory authority available when these new plants actually do go into operation.

Governor CURTIS. I might add, according to the recent census, it's hard to tell how much industry we have lost. Looking at the recent census where Aroostook County has lost 13 percent of its population in 10 years, this is another good reason why we want the Dickey-Lincoln project built, to bring an economic stimulant in this particular area. We also know that power prices out west are half what they are in Aroostook County. That is another reason for locating plants in the area.

Washington County is one of the most severely depressed areas in the northeast. This was again a target of President Roosevelt in the thirties to build something to stimulate growth in a particular area. So much of the depressed condition of Maine certainly can be traced back to this failure to build the necessary power generating facilities. And I think just the 5-percent voltage reduction that has occurred this vear is an indication that we don't even have enough power to take care of the the domestic needs. So we can't go out and attract industry on the basis we can get power for them.

There is one particular company, in fact, that has been threatening to leave Maine because of an inadequate supply of power. They would expand if the power were available. So not only are we losing their expansion, but we may lose the company, too.

Senator MUSKIE. The Pacific Northwest and the Tennessee Valley are two areas where power development was regarded as a stimulus to economic growth. It is the exact reverse of the philosophy you describe here in New England.

Governor, I appreciate your testimony this morning. I know this is an important day for you and I wish you all success. I expect you will know before the end of the day.

Governor CURTIS. I hope it is important. Thank you.

Senator MUSKIE. Our next witness is not on the printed witness list, the distinguished leader here in Massachusetts who increasingly has been identified with environmental issues by all of the people of the State and of the country, Senator John Moakley. We are delighted to welcome Senator Moakley this morning and glad to receive his testimony. I think it is appropriate that a member of the State legislative body be among the witnesses this morning.

Senator Moakley, it is a pleasure to welcome you.

STATEMENT OF HON. JOHN J. MOAKLEY, MASSACHUSETTS STATE SENATE

Mr. MOAKLEY. Thank you very much, Senator. It is a pleasure to welcome your committee here.

Senator MUSKIE. I ought to note for the record that you are chairman of the resources commission, Harbor Islands Commission, and Committee on Urban Affairs in the Massachusetts Senate.

Mr. MOAKLEY. Thank you very much, Senator. First I'd like to thank you very much for bringing your subcommittee to Boston for this hearing, for the opportunity to be heard on Senate bill 2752. Your coming to Boston, I think, reflects in itself your committee's concern for Federal/State cooperation, and we in Massachusetts State government recognize and appreciate this.

The production of electric power has brought a myriad of disruptive factors to our environment. These problems have not and will not be solved under our present fragmented governmental efforts.

Senate 2752 which you have sponsored, Mr. Chairman, recognizes and works to correct these disjointed and many times conflicting attempts to make our environment livable. You and your subcommittee have recognized the serious lack of interstate and regional planning in selecting powerplant sites.

The need for S. 2752 could not be more vividly portrayed than by the dilemma that we in Massachusetts face today.

As chairman of the Urban Affairs Committee, my colleagues and I face an awesome decision, which, if S. 2752 had been enacted only a few short years ago, would have been avoided.

Mr. Chairman, my colleagues and I must soon decide whether to allow the diversion of drinking water from the Connecticut River into Boston's Quabbin Reservoir. Normally, and because of Boston's pressing need for this added water, such a proposal would be surely and