tive scale never before considered feasible. In late 1964, after reading "Night Comes To The Cumberlands," the engineering firm of Laramore, Douglass and Popham contacted Harry Caudill with the germ of an idea for a coordinated EHV eastern network supplied by large mine mouth generating stations located in the heart of Appalachia. It was from this point that the outline of the Plan began to take shape.

On March 8, 1965 the basic Yankee-Dixie Plan was presented by Laramore, Douglass and Popham in Washington, D.C. to a group of management and engineering personnel representing a number of municipal and cooperative utilities from New England to Florida. The reception to this presentation was so enthusiastic that the utility group agreed that same day to form an association dedicated to making the Plan a reality. A Steering Committee was formed, various working committees appointed, and the Yankee-Dixie Power Association was born.

During the last year since the formation of Yankee-Dixie, considerable organizational work has been accomplished. A number of Steering Committee meetings have been held. The Legal, Finance, Publicity and Membership Committees have completed a number of important tasks including the drafting of appropriate legislation to facilitate the building and operation of the proposed Yankee-Dixie System, the raising of interim financing and the organization of a membership drive. Last fall invitations were issued to the principal investor owned utilities in the eastern United States, and all of the consumer owned utilities in the same region plus some of the Middle Western states, to attend a general meeting with the objective of briefing all interested parties on the basic purpose and concepts of Yankee-Dixie. This meeting, held on November 18, 1965 at the Washington Hilton Hotel in Washington, was well attended and received by over 200 representatives of both consumer and investor owned utilities serving most of the states east of the Mississippi. A considerable amount of favorable publicity was disseminated by the press, TV and radio.

On November 15, 1965 the Association was incorporated as "Yankee-Dixie Power Association, Inc." Mr. H. L. Spurlock, Manager of East Kentucky Rural Electric Cooperative Corporation, was elected President and Mr. Frank H. King, Manager of the Gas & Electric Department in Holyoke, Massachusetts, was elected Vice President. Other officers, members of the Board of Directors and the various Working Committees are given at the end of this publication.

Yankee-Dixie is a going enterprise. Through this enterprise, men of broad vision and tenacity of purpose can bring the Yankee-Dixie Plan to fruition and provide a basic low cost bulk power rate to the entire Eastern Seaboard and as far west as the Mississippi. Such men, representing a wide geographic distribution of utilities, are now a working part of Yankee-Dixie. More utilities and their representatives are joining the effort every month. The need for a Yankee-Dixie giant power system is unquestioned and a good case could undoubtedly be made for its construction as insurance against another Northeast or similar widespread blackout which would be a threat to public health and national security. Use of electric power in the heavily populated regions east of the Mississippi is expected to multiply by 2 to 22 times through 1980. This demand must be met and it must be met safely from sources of power economical enough to provide stimulus for the continued development of this important area of our country. Yankee-Dixie Power Association, Inc. is an organization that is providing the impetus required to ultimately realize, for all of its members, the reliable, low cost bulk power that will be essntial to our national economy in the closing decades of the twentieth century.

Since the bulk wholesale power cost for consumer owned utilities in the coastal plain of the Unitd States east of the Appalachians generally has been higher than comparable costs in other parts of the country, it was quite natural that these consumer owned utilities would initiate the organization needed to meet their needs. The original Coordinated Plan was designed for over 550 consumer owned utilities in the 17 states of Maine, Massachusetts, Vermont, New Hampshire, Rhode Island, Connecticut, Pennsylvania, New Jersey, Maryland, Delaware, West Virginia, Virginia, North Carolina, South Carolina, Alabama, Georgia and Florida plus eastern Kentucky. Consumer owned utilities in New York, Ohio, Indiana, Illinois and western Kentucky have since expressed an interest in being included in the Plan and many of these utilities have become members of Yankee-Dixie. The Revised Conceptual Engineering Study as described in Section II of this publication has now been supplemented to include

the consumer owned utilities in these other states and the up-dated Plan includes 22 states and almost 1,000 consumer owned utilities.

Although consumer owned utilities make up the entire membership of YankeeDixie at present, the Association is not restricted to this type of member. Overtures have been made to investor owned utilities in the area and they have been invited to join. Continuing efforts will be made in this direction since industry wide cooperation will distribute the benefits of the Plan on a broad basis. Such cooperation will also be in consonance with efforts of the Federal Power Act which directs the Commission to "promote and encourage-interconnection and coordination" of electric utility systems for "-the purpose of assuring an abundant supply of electric energy throughout the United States with the greatest possible economy and with regard to the proper utilization and conservation of natural resources-."

MEMBERSHIP IN THE YANKEE-DIXIE POWER ASSOCIATION

Membership information, application forms, and fee schedules are available at Yankee-Dixie headquarters in Winchester Kentucky and locally at the offices of most of the Municipal and REA Cooperative Statewide Associations.

Monies realized from membership fees are used to defray the cost of operations and to finance the detailed legal and engineering studies now being undertaken to construct the legal framework, finalize the physical plant and prepare the economic analyses required for obtaining financing.

All utilities in the area covered by the Yankee-Dixie Plan are urged to join the Association. It is the best guarantee of obtaining future low cost bulk power for those utilities now burdened with high costs, and of retaining low bulk power costs for those fortunate enough to have low costs at present.

The lack of specific action to date on the part of investor owned utilities in regard to participation is disappointing. Yankee-Dixie can, and will if necessary, provide low cost bulk power exclusively to consumer owned utilities. Planning at present is necessarily proceeding on this basis. It would, however, seem more in harmony with the National Power Survey recommendations and the best national interest to have at least partial cooperation from investor owned utilities to take maximum advantage of the EHV overlay that will be provided by YankeeDixie. The invitation for investor owned utilities, therefore, is still cordially extended and will continue to be extended in the future.

Here is a new concept for Appalachia which presents a comprehensive Plan for utilizing the vast mineral wealth within the region by exporting the converted finished product rather than the raw material but with part of the wealth generated remaining behind for local development. Yankee-Dixie proposes to improve this region rather than to exploit it. With the revised Coordinated Plan, the economic benefits will extend into the heart of the great Middle West and a true interconnected EHV overlay will reach from New England to Florida and from the Carolinas to central Illinois.

Low cost bulk power and reliability of service remain the prime objectives of the Yankee-Dixie Power Association. If, in realizing this plan, a by-product as significant as the redevelopment of Appalachia can be achieved, this program will truly take its place with other major achievements of our age.

SUMMARY OF THE REVISED CONCEPTUAL ENGINEERING STUDY

The Appalachian highlands of the eastern United States are blessed with one of the largest, relatively high quality coal deposits in the world. Roughly speaking, this coal region extends from northwestern Pennsylvania and eastern Ohio down into northern Alabama; it is called the "Eastern Coal Province, Appalachian Region." Just to the west of this coal region is a second major deposit which extends from central Illinois down through the southern part of the state and southwestern Indiana into west Kentucky; this area is called the "Interior Coal Province," Eastern Region. Although the quality of its coal is not as good as that of the Appalachian Region, it is eminently satisfactory for electric power generation purposes.

The latest Yankee-Dixie Plan envisions four 2000 mw (minimum) mine mouth, coal fired generating stations located in these two major coal provinces east of the Mississippi; tentatively the stations have been located in western Pennsylvania, eastern Kentucky, northern Alabama and southern Illinois or southwestern Indiana. The four giant base load generating stations will be

interconnected with a complex network of extra high voltage (EHV) transmission lines which will feed load centers in a 22 state area from New England to Florida and as far west as Illinois and Alabama. Large, low cost peakingreserve, residual oil or gas burning steam electric generating units will be installed throughout the local areas to provide economical peaking power and area reserve. The estimated capital cost for Yankee-Dixie is 1.884 billion dollars. Over 12,000 mw of power and nearly 60 billion kilowatt hours of energy will be delivered by the system to local load centers.

Realization of the Plan will result in a strong, coordinated system that will utilize the economical fuel reserves of Appalachia and the Middle West to distribute reliable, low cost power benefits throughout most of the United States east of the Mississippi. When coordinated fully with existing large utility systems, the Yankee-Dixie system will provide an EHV overlay that will significantly contribute to the reliability and stability of the overall power complex of the entire area.

The average or "postage stamp" delivered cost of firm power to the local load centers as useable load factors is conservatively estimated at 4.5 mills per kilowatt hour. This is lower than most long range estimates made today for high load factor power in the eastern United States.

Although the Revised Conceptual Engineering Study presented in this publication made no attempt to estimate local wheeling costs, they will probably range from 1 to 2 mills per kilowatt hour or possibly more for some of the low load density areas remote from the EHV step-down substations. Realistic delivered costs to user substations, therefore, can be forecasted at 5.5 to 6.5 mills per kilowatt hour with 7 mills perhaps being an upper limit.

The CHAIRMAN. Are there any further questions?
Mr. Mayne?

Mr. MAYNE. Mr. Cohn, as I understand your answer to Mr. Abernethy, did you tell him that you were unable to give any precise testimony as to how many people are involved in the 4,000-connection situation?

Mr. CонN. I think that the best that could be done, Mr. Maynethe best I could do-would be to attempt to estimate the number of people on the average who would be served by a single connection. I am thinking in terms of the average home, and I would expect that the average family would run somewhere in the neighborhood of four or five with one connection for that purpose which would represent four or five people, and if you thought only in those terms, you would multiply 4,000 connections by 4 or 5.

Mr. MAYNE. I did not quite get your words there.

Did you say that you would "expect" or "suspect" that there would be four to five people?

Mr. COHN. I would expect; I would estimate that would be the fact. I should go further, Mr. Mayne, to point out that the word "connection" is a rather slippery word. It is entirely possible that the bill would be interpreted to mean that a connection to a municipal system of 10,000, 15,000, 20,000 people could be regarded as one connection.

Mr. MAYNE. Well, as I understood you, you were getting some figures for Mr. Abernethy and they would be based on communities of 20,000 people. Is that not correct?

Mr. COHN. That is the way that I understood Mr. Abernethy's question; yes, sir.

Mr. MAYNE. Of course, he arrived at that 20,000 figure after you had given him this estimate and multiplied 4,000 by, I believe, 4 or 5? Mr. COHN. That is right.

Mr. MAYNE. And you are content to leave the record in that state, are you, that 4,000 connections means roughly 20,000 people?

Mr. CонN. No, sir. I was addressing myself in response to the question as to the kind of connections that would be involved, connections to urban residences in an urban area.

Mr. MAYNE. Do you mean that it might be even larger than 20,000? Mr. CoнN. Yes, indeed. The point that I have just tired to make is that the word "connection" is a word that is rather an unusual one in this context. It is possible that "connection" would be interpreted to mean a single connection, that is, one connection, as being involved where there was only one interconnection with, let us assume, a municipal system or an office building that might house many hundreds of people.

Mr. MAYNE. I believe that you made that point, Mr Cohn. This is quite a drastic change in the existing law, is it not?

Mr. COHN. It is, indeed, Congressman Mayne. We think it is not justifiable.

Mr. MAYNE. Do you not think that somewhere in the electric industry there has been a more precise study as to what "connection" means, or will we have to rely on your rough estimate of "5" average in the American family?

Mr. COHN. I honestly do not know whether any study has been made as to the precise question, but I would be delighted to undertake to submit for the record everything we can find in the time available that would indicate what 4,000 connections would mean.

Mr. MAYNE. It seems to me that before you get these other figures for Mr. Abernethy, that in all fairness he is entitled to a more precise answer as to what 4,000 connections mean. I have had it indicated that in my part of the country, which is northwest Iowa, it is a much smaller figure, perhaps 212 people to a connection, or a community of 10,000 population, which is still a drastic change, but it does seem to me that this is something on which the committee is entitled to more precise information than just a very rough estimate as to what an average family consists of, and I would be grateful if the Edison Electric Institute or some arm of the industry would give us a more precise figure, more precise information. It seems to me that it is quite an important point that we are getting into there.

Mr. KLEPPE. Will you yield?

Mr. MAYNE. Yes.

Mr. COнN. We will try to supply the best information we can get together. What I have said this morning is off the top of my head. The average family is somewhere in that neighborhood. That is the only reason that I stated that. I do not have anything available at the table with me now. We will get the best information we can. I agree that the committee is entitled to the best that we can give them.

Mr. MAYNE. Your remark surprises me, because up to this point it did not seem to me that you were talking off the top of your head.

Mr. KLEPPE. My question is: Would it make any difference in your position, as to this 4,000-connection provision, if the population were 20,000 or 10,000? Does this change the attitude of your feelings regarding this section of the bill?

Mr. CонN. No, sir, it does not. Our position is a very simple one: We submit-and we submit this as strongly as we can-that Federal assistance is justifiable to bring electric power to persons in rural areas

who do not otherwise have central station service available to them. Federal assistance is not justifiable is not justifiable, I repeat-where central station service is now available in urban areas. Of course, the urban area service is available to everyone who wants it.

Mr. KLEPPE. That is the point that I wanted to make for the record. Thank you, Mr. Mayne.

The CHAIRMAN. Mr. Montgomery is recognized.

Mr. MONTGOMERY. Just one brief question to Mr. Harris. Maybe this is to help me make up my mind on some of these bills.

In most cases, power sold to the REA by the private power company, the cost of the power to the REA's in most cases is not regulated by the Federal Power Commission or by any public service commission in the different States; is that correct?

In other words, you just negotiate a price with the REA on the power that they need?

Mr. HARRIS. I would not say that would be a fair representation of the regulatory picture. There may be three States in the Union that have no regulatory bodies, where the power is involved only in intrastate movement. It seems to me that has been the situation in our part of the country since the REA's have been in existence, that the wholesale power rate has been subject to regulation-in fact, the Public Service Commission has asserted jurisdiction over those rates. They were published in the original making of the 7.5-mill rate that has been in effect in our service area for more than 20 years. And that rate was litigated in the courts of North Carolina where there were municipalities that said that they ought to be entitled to as low a rate as we were providing service to the co-ops, and the Supreme Court of North Carolina said "No," that it was a legitimate function of the regulatory process, to permit the development of the rural economy.

We were giving an economy rate to the cooperative.

I think that the same situation has very generally been applicable in most of the States of the Union.

Now, the exercise of regulatory power over these wholesale rates, where the power moves in interstate commerce is something relatively

new.

Mr. MONTGOMERY. Intrastate is what I meant.

Mr. HARRIS. Of course, Mr. Montgomery, we are going through a little transition in the regulatory business with respect to wholesale rates. Most of the companies of the country are interconnected with their neighbors and power moves in and out across State lines, particularly since the so-called Colton case in California of about 3 years ago, where the Federal Power Commission has asserted, almost for the first time, its jurisdiction over wholesale rates, because they say that if any part of the power in the system-this is a recent decision-that if any power in the system at any time ever moves in interstate commerce it gives them jurisdiction over that utility, including jurisdiction over its wholesale rates, and sale for resale is a wholesale rate.

So, that any company that has any part of its power supply moving at any time, even though it be in an emergency situation, in interstate commerce, the Federal Power Commission asserts jurisdiction over the sales for resale including cooperatives.

So, I think that there would be very few locations in the Nation in which, as far as the investor-owned companies are concerned, that