is to get ideas such as the useful and perhaps provocative one you have just described.

Second, I think that what we would like to develop here and I suppose this takes into account political realities-is an evolutionary process that may begin with something less than the kind of Federal oversight we might like, ideally. But nevertheless, it might grow into that if we can get the thing started. We may be over cautious.

Mr. Ross. I am speaking partly, Senator Muskie, from my experience in serving as a member of the International Joint Commission, and I have been particularly taken with the ability of the Commission to bring together the various experts of both countries to work in an advisory capacity for us. We have no staff, but they show a dedication to the public interest, they show an ability, that is, the employees of the Department of the Interior, HEW, Federal Power Commission, they have shown a very great willingness to work together, to come up with good, sound recommendations and cast aside some of the departmental rivalries. We have had fine cooperation from our resource experts from some of the States as well.

The States are really serious about trying to solve the problem and forget the fact of working with their rivals, the Feds, and they think if the people are the beneficiaries, it can be done.

We don't, in my opinion, have to send an applicant to five different State water resource departments, five different public utility commissions, five different air pollution State commissions, and, of course, your work in air pollution has been very helpful. But the delay that the applicants are being faced with today has to be cut short somehow. I agree, it may not be possible to go all the way, and I may not have the right answer, but this is the value of these hearings, the airing of these problems, and with your wisdom maybe you can take the ideas that some of us propose and come up with something better.

Senator MUSKIE. Sometimes, perhaps we ought to push harder than we may be inclined to initially to get the ideal solution.

There is one other point I think ought to be clarified with respect to your testimony on this question. Do you envision the Federal authority operating on a regional basis?

Mr. Ross. Yes, sir. But the thing that bothers me, and as I sat here this morning listening to some of the testimony, in view of my experience on the Federal Power Commission and my experience on the International Commission, this concept of the region is a constantly moving target. The New York Times yesterday had a long article about the province of Ontario and the province of Quebec coming to the aid of the New York pool. Well, you can't separate the New England pool, as somebody I think of the Consumers Council indicated this morning, you can't separate it really and truly from New York any more than New England from New Brunswick. You can't separate each from the problems of the other. If one of your adjoining regions has a history of problems, a history of brownouts or an inability to forecast power supply needs, its power requirements, it's going to throw a burden on your adjoining region.

In Vermont, Senator, there is a powerline that connects Vermont and northern New York State the New York Power Authority. Whether or not that line should be bucked up, in order to build up the

security of the power supply of New York, really has nothing to do with Vermont. Vermont owns half of it, Vermont is going to have to pay to improve this vital interconnection which has a bearing on the reliability of power supplies to Connecticut, Rhode Island, and Massachusetts, indirectly to Vermont, too, which has a burden. But this is a welding together, which has got to be a strong, viable, interstate power system. Your difficulty is that you may run into a danger of moving from a little local level to a tight regional level, and forgetting about the necessity to cooperate between regions.

Senator MUSKIE. This seems to point to a national grid.

Mr. Ross. Whether it is a national grid or whether it is improving our present system—and I think maybe you have suggested the possibility of advancing funds or Federal efforts to assist where an intertie, the bucking up of an intertie may not be at the moment clearly, financially advantageous where the cost-benefit ratio might be even-steven. Maybe a procedure can be developed as I think you have indicated which might be able to expedite this construction in advance. For example, the Maine-New Brunswick intertie. A lot depended upon whether you prove economically it would pay.

This is one of the things Governor Curtis was interested in, because his consumers were going to have to pay for it.

Now, there are other factors. There is the factor of safety. If the line were built it could possibly be an outlet, an insurance policy for New England. How do you weigh that? How do you get power companies to lay on the line tremendous sums of money when it's this intangible factor, whether it is the environment or the safety of the people. There's something to be said for the strong intertie with Quebec-Hydro which people have talked about. There may not be at the moment any particular big financial benefit from a strong intertie with Quebec-Hydro, but in terms of long-range plans, long-range security of our Nation, it might well be worthwhile to put in the intertie and possibly additional benefits would flow.

Senator MUSKIE. At the very least, this would require national planning.

Mr. Ross. That's right. So in a sense, the term national grid, is somewhat of a misnomer. We do have all of Eastern and Central United States tied into a power system. But this is why I have supported Senator Kennedy's reliability bill because it would give a better recognition of the national interest and not depend strictly on voluntary reliability councils. I'm not one of those.

Senator MUSKIE. You do not buy NEPOOL?

Mr. Ross. Now you have brought up another subject. I have testified before the Securities and Exchange Commission on the proposed merger of three New England utilities, and I have said that I don't think this merger should occur until they have tried NEPOOL, until they have tried-until the record clearly discloses that men of good will, who are bound and determined to advance the public interest, could not do it with NEPOOL.

The utilities have not actually consummated their final thinking so far as NEPOOL is concerned. We are talking about a halfway house when it comes to NEPOOL at the moment. With proper input of State and local government interests, proper and better regulation on

a State basis, better coordinated regional regulation by the State involved so they can supervise what is going on in NEPOOL, and they know what's going on, they have the experts to advise them which they don't have now, NEPOOL could well work out. You have to have some sophisticated people looking over NEPOOL's shoulders, and the help of Federal agencies.

Senator MUSKIE. So you would have to have the two.

Mr. Ross. Yes. May I go back to my statement?
Senator MUSKIE. Yes.

Mr. Ross. Hearings on any application for a license should be convened as early as reliable factual data can be secured, hopefully well before any deadline for construction. Of course, the proceedings under this proposal would not be required for purely intrastate matters.

It would be my hope also that consideration of a New England Regional Siting Authority should not be forgotten since the acquisition of an adequate inventory of regional sites long before the immediate need would improve long-range economic and utility planning. Surely there is enough technical expertise in the Nation to identify with some specificity future plant sites and transmission rights-of-way. If money is the deterring factor, then Senator Muskie's proposal to have the Federal Government assist in providing the wherewithal is excellent. In summary, it is my belief that the time has come for all interests to sacrifice some of their independence and sovereignty in the interest of a quality environment and an adequate energy supply for the community, the State, the region, and the Nation as a whole, above all. Thus, in matters involving interstate power supply, I would suggest we consider adopting a one-shot procedure, as early in the game as possible, forcing all the jealous and competing interests to join in the game with guarantee that the local interests will be adequately and competently represented so it is not a battle of dollars as to who wins. Thank you very much for this opportunity to appear before you this morning, Senator Muskie, and I wish you well.

Senator MUSKIE. Thank you very much, Mr. Ross, not only for your testimony this morning, but also for your long history and concern with the public interests in this area. I would feel better about the whole business if you were somewhere other than where you are. Mr. Ross. Vermont is an awfully nice place.

Senator MUSKIE. I know it is. I wonder, speaking of Vermont, if you would describe the methods by which Vermont has dealt with problems of electric reliability and environmental protection? I think we have the feeling that not only at the Federal level, but also at the State level, there is inadequate input, and inadequate connection between the agencies of public policies relating to these two questions. I wonder if Vermont has experimented with some ideas and some policies? Some expression from you would be helpful.

Mr. Ross. Essentially, about 2 years ago the legislature passed a bill which sets up a requirement for the licensing of extra high voltage transmission lines and all power stations. This has been proposed earlier. The industry fought it but it finally got through. In this last session of the legislature I think Vermont made some very, very important strides. I think Governor Davis and his legislature should be congratulated for going as far as they did.

In our experience many times legislation can always be improved, and I'm not suggesting that what has come about in Vermont goes far enough. It is a long step forward. They have basically tried to coordinate all the resources into one agency. This is, again a concept of one-stop shopping.

They are providing for planned land use. Ultimately I suspect Vermont will go for statewide zoning. This seems to be in the making. They have tried to bring in local concerns on this whole field by requiring any development for all intents and purposes to get a certifi

cate.

Vermont has had tremendous problems with vacation homes, being threatened with an invasion from New York and the rest of the Nation, and we're trying to do it on a controlled basis, we're trying to have controlled living, controlled progress. The legislature also set up, as they say, a pay-to-pollute bill. I'm not quite that enthused about the concept, but it is going to be tried. If it has to be amended, they will try to work out the details.

We have, let's see, there are a number of others, I can't think right offhand, but the last session of the legislature was primarily concerned with environmental needs of the State. We have a bill proposed to provide for an inventory of the utility sites, to allow the State authority to go out and purchase sites well in advance, because much of the economic development of a State or region is going to depend upon the location of the power station and location of your transmission rightsof-way. It never saw the light of day; I'm very hopeful that possibly in another session it can.

There is a tremendous debate all through New England that each State wants to control its known destiny. Each State has no reason why it should provide land for sites that will furnish power for other States in New England. But I think it's going to be required and I think the siting bill really should be done on a regional basis rather than on a State basis, but whether it will happen, I don't know.

Senator MUSKIE. Thank you very much, Mr. Ross, for your excellent testimony.

Mr. Ross. Thank you.

Senator MUSKIE. Mr. William Tallman, president of the Public Service Co., of New Hampshire. Mr. Tallman, we appreciate the interest and time you are giving us this morning and we welcome your testimony.

STATEMENT OF WILLIAM C. TALLMAN, PRESIDENT, PUBLIC SERVICE CO. OF NEW HAMPSHIRE

Mr. TALLMAN. Thank you, Senator Muskie, I appreciate the opportunity to appear before you this morning. I have with me the director of NEPEX, Mr. Harry Mochon, to help me with whatever questions you might want to ask, Mr. Chairman.

Mr. Chairman, my name is William C. Tallman, I live in Bedford, N.H., and I am president of Public Service Co. of New Hampshire. I appreciate very much this opportunity to appear before the subcommittee. I do so as chief executive of Public Service Co. of New Hampshire, an investor-owned system, and also as chairman of the

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executive committee of NEPEX, the New England Power Exchange. At the present time, I also serve as chairman of the Edison Electric Institute Committee on Environment and as chairman of the Electric Power Council on Environment. However, let me emphasize I am not appearing here today for these organizations. Also, let me state that I am not prepared, nor am I authorized by NEPEX, to comment on the specific bill being heard. Rather, I will discuss the power supply situation in New England and comment briefly on environmental considerations.

New England's electric power requirements are supplied by nine major investor-owned utilities serving approximately 85 percent of the electric users; by 33 smaller investor-owned companies serving 6 percent of the users; by 76 municipal systems serving 8 percent of the users; and by eight REA cooperatives serving 1 percent of the users. It is clear that with this structure, coordinated power supply planning and operation is required for service reliability and for maximum economy of use of our natural resources and maximum economy dollarwise.

New England as a region pioneered in power pooling and interconnection matters. For example, the Connecticut Valley Power Exchange was established in 1925. The first 115,000-volt intersection tie in the country running from Adams, Mass., to Greenbush, N.Y., was completed in 1930. New England has been operating as an informal power pool for many years.

The development of a formal power pool started in 1966 with the appointment of an ad hoc committee by the nine major utilities serving the region. Work has proceeded intensively since then, and on April 22, 1970, it was announced that agreement had been reached on the first stage of a formal New England power pool, to be known as NEPOOL. This agreement was hammered together by a working committee composed of representatives of investor-owned systems, municipals, and REA systems. State commission and Federal Power Commission representatives also participated. Basically the agreement covers the establishment of the operating arm of a pool which is NEPEX. Understandings were also reached on some general principles covering the broader NEPOOL agreement. When these principles are implemented, and the target date is April 1, 1971, we will have developed the most sophisticated power pool in the country for New England.

NEPEX started operations on June 1, 1970. Nine major investorowned participants, six smaller investor-owned participants, and 49 municipal and cooperative systems have signed the NEPEX agreement. Participation is open to all utilities in New England. NEPEX has four basic objectives: (1) Maximum service reliability, (2) maximum dollar economy in energy transactions, (3) maximum economy in the use of our natural resources, and (4) an equitable sharing of the benefits and costs.

Planning for an adequate and reliable power supply for New England was first carried out by a Planning Committee of the Electric Coordinating Council of New England from the 1940's until an Interim NEPOOL Planning Committee was established with a full-time staff. This committee has been operating since then until the NEPEX