is, to authorize a single agency to coordinate the environmental interests of the various agencies and to issue site authorizations.

I think that my remarks and observations support the fact that in the new climate of emphasis and attention to the preservation of our environment and to the concern for needed electric power-it is essential more than ever that there be cooperation at all levels of government. While I have suggested some ways by which our Federal and State efforts have been mutually beneficial, I would hope my remarks will prompt you, on behalf of your States, to keep me and the Commission informed of any problems you become aware of and to suggest to us ways in which our cooperative efforts may be enhanced.

44

REMARKS OF WILLIAM F. KENNEDY, ASSOCIATE GENERAL COUNSEL, GENERAL ELECTRIC COMPANY, AT THE AMERICAN BAR ASSOCIATIONAMERICAN LAW INSTITUTE PROGRAM ON ATOMIC ENERGY REGULATION, NOVEMBER 13, 1971

NUCLEAR ELECTRIC POWER AND THE ENVIRONMENT-NEW REGULATORY STRUCTURES AND PROCEDURES

There are various ways to look at Calvert Cliffs but one of the more useful is to regard it as an episode in a campaign of history. Nuclear power plant regulation was not in good shape before that opinion; Calvert Cliffs leaves it in a state of near-hopeless disarray. Still the decision has one great merit-it will force everyone concerned, and notably the Congress, to face the problem of how the nation will make decisions about electric power and the environment. Calvert Cliffs is irreversible in the sense that the country will not go back to the situation pre-NEPA; but since its effects are already proving unlivable, the only choice is new federal legislation. The meaningful debate will be about the terms of this legislation. In my comments this morning, I will attempt a contribution to that debate.

I

Environmentalists are raising very pertinent questions about the physical, biological and social impact of the projected growth of energy production and consumption over the next two or three decades. As a nation, we are facing a profound dilemma-we have an energy-based economy, or more properly, an energy-based way of life, but we have to ask whether the price of this life-style in effects on our natural surroundings may not prove too high-too high if present rates of growth continue indefinitely and if we don't find new technologies to avoid the dilemma.

On the other hand, I believe it is proper to turn back on many environmentalists their own favorite criticism of both government and industry-namely, they are systematically ignoring important sideeffects of their policies and proposals. The basic environmentalist position is that it should no longer be national policy to expand electrical supply to meet demand. One can advocate this point of view, but it is also necessary to understand its implications.

First of all and above all, the environmentalists are proposing a policy change with such a substantial impact on the daily lives of the American people, that any decision to make the change should be made legislatively, by representatives accountable to the electorate. Moreover, the decision is of such importance that it should be made in

the most direct and explicit way as a new legislative declaration of policy.

Second, a legislative decision that electricity will not necessarily be available to meet demand, calls for other legislative decisions-on how demand will be constrained or on how supply will be allocated among competing demands. The notion that an administrative agency would stop a particular project even though this led to power shortages, and that the non-elected managers of utility systems would proceed to make decisions rationing electrical supply, is nonsensical.

Third, before any such legislative policy were established, one would hope that there would be thoroughgoing analysis of its implications for the economy and for our day-to-day lives and full public debate. There are some beginnings along this line, but we don't have the analysis and we haven't had the debate.

Fourth, it should be clear for all these reasons that any legislative judgment to limit the growth of electric power would have to be made with a long lead time, so that there would be time to adjust to its effects.

I have perhaps labored these propositions, but I have done so to make a very immediate point. I gather that there are those who contend that Calvert Cliffs opens the door to argument in a nuclear power plant proceeding about whether, as matter of policy, electrical demand in a given area should be served at all; Calvert Cliffs is not clear on this point, and neither is the Atomic Energy Commission's interpretation of it. Moreover, it is stretching the general language of NEPA very far indeed to interpret it as overriding specific state statutes embodying contrary policies.

In any event, the first point to be made about any new regulatory structure addressed to electric power and the environment, is that it is an absurdity to have issues about need for power fought out plantby-plant. If we are to have constraints on electric power growth, they have to be legislatively imposed, on a broad planning basis, with a long lead time, with accompanying mechanisms to limit demand or ration supply, and independently of a decision as to whether to go forward with a particular project.

None of the pending proposals on power plant siting legislation seem to me to deal clearly with this issue and it is one which ought to be addressed, as I have said, very directly and explicitly.

Next, let me turn to a second underlying issue in many power plant controversies that of land use. Are we, after Calvert Cliffs, to have this issue too resolved by AEC plant-by-plant? I am not talking about site suitability from a radiological safety point of view, but about basic policy questions, such as the optimum use of land and water resources in a given state or region.

Under Calvert Cliffs, the fact that this issue had been resolved in a state proceeding might not be binding on AEC; conversely, it is not at all clear just what effect an AEC determination would have if a state elected to reexamine it. We may have just one more case where anyone can say no, but no one can say yes.

Again, are land use decisions from here on out to be made piecemeal and short-range, or is the country going to try to introduce some degree of system and rationality in dealing with this very fundamental problem? There are pending in the Senate and House, bills proposed by Senator Jackson and Congressman Aspinall and by the Adminis

tration, which would provide federal aid for state and regional landuse planning mechanisms. The bills contemplate that allocation of land as wilderness, or for recreation, for industrial uses, for transportation and energy requirements, and for residential purposes, will be accomplished under a state-wide planning procedure. There are provisions for public participation in the process and for regional coordination. Isn't this the orderly way to deal with the location of electric generating stations and of transmission lines? The land-use bills are generally thought to have some prospect of passage in 1972 or '73, and it will be essential to integrate these bills carefully with any new Congressional treatment of the environmental issues associated with electric power.

This brings us to the role of the federal government and the states in any rational scheme of regulation. Is it sensible to call for decisions on a national level-by a body with AEC's multiple involvements-on such issues as need for power, land use, and the tradeoffs between environmental effects of various modes of electric power generation?

One of the lessons of recent experience is that decisions made too far away from the people affected may not be politically acceptable. I am not urging any dogmatic states' rights point of view, because I think we need a large federal role, but choices about whether to go without electric power or to accept the environment effects of generating and transmitting it, should be made by bodies as close as possible to the people who would use the power and bear the effects.

Pending power plant siting bills recognize this by calling on the states to establish one-stop regulatory reviews, and providing for federal reviews only when the states do not establish mechanisms meeting federal guidelines. I think this approach is sound-with perhaps the modification that there should also be a federal role in those cases where need for power and environmental effects transcend state lines and the affected states have not established appropriate regional mechanisms.

IV

Again, shouldn't Congress sort out in a more rational way, the roles of various federal agencies in dealing with the environmental effects of electric power generation? Currently, the AEC, the Federal Power Commission, the Environmental Protection Administration, and the Corps of Engineers all have pieces of the problem.

Turning very specifically to nuclear power plants, isn't it clear that Calvert Cliffs has forced us to ask new questions about AEC's longterm role in dealing with non-radiological issues associated with electric power generation and transmission?

I have already spoken of the incongruity of calling on AEC to decide questions such as need for power, and land use, and the ultimate social and moral issues associated with energy-environment tradeoffs. But this isn't all. Suppose after Calvert Cliffs, an intervenor elects to argue before AEC that it is better in a given situation to build a fossil plantan argument analogous to the one made in the Storm King case that gas turbines rather than pumped storage, should be used for peaking requirements? Is AEC supposed to pass on the merits of fossil-fuel alternatives, including the range of issues from air quality to strip mining? There are pros and cons about combining in one agency responsi

bility for military applications of atomic energy, the development of advanced nuclear technology for civilian uses, and radiological safety regulation. But for these three functions, there are arguments that they are closely interrelated and particularly that AEC's in-depth technical capability, growing out of its varied programs, makes it the logical vehicle for nuclear equipment design reviews.

However, does any one believe that the three historic AEC rolesmilitary applications, civilian development, and radiological safety regulation can long be combined with a fourth growing out of NEPĂ and Calvert Cliffs-namely, the responsibility of making fundamental value judgments about nuclear energy and the environment, and indeed about electricity and the environment? The recent controversy about Cannikin dramatizes how difficult it will be for AEC, while executing decisions on national security, to establish in some quarters the necessary credibility on environmental policy.

There are various ways to resolve this organizational dilemma. One way is to rely on other mechanisms, established under land use and power plant siting legislation, to make the fundamental policy decisions and to leave AEC with its pre-NAPA role on radiological safety. This is the approach clearly contemplated by the Joint Committee on Atomic Energy in its recent release.

There are certainly other possibilities and the whole question will have to be examined, in choosing a federal certifying agency, if the Administration proposals for power plant siting legislation, are enacted in anything like their present form.

Relatedly shouldn't we examine also various combinations of the presently separated responsibilities of EPA, FPC and the Corps of Engineers with respect to environmental effects of all kinds of power plants-all with a view to approaching more closely a federal onestop mechanism?

V

Before taking up questions of regulatory procedure, let me say one last word about a more general matter the subject of preemption on radiological safety. One way or another we are going to have a broad reexamination of this issue; the present climate of opinion, the cases in Minnesota and Illinois, the provisions of the Senate-passed amendments to the Federal Water Pollution Control Act, the efforts last year in the Clean Air Act Amendments, the statements of the Joint Committee all look toward a reexamination.

I would contend that any such reconsideration should not compromise the principle of a single (which means federal) review of nuclear equipment design. I believe that this principle can be reconciled with a role for the states on policy issues involving nuclear power plants. Specifically, states should participate with EPA in setting general criteria for radiation exposure, so to speak "ambient" radiation standards. States should have the right to ban all nuclear power plants or to limit their number however irrational that might be. Certainly they should have the power to decide that all things considered, in a given case, a fossil plant was a preferable alternative. I believe this approach accommodates legitimate concerns about the role of the states, without multiplying design reviews and thereby compromising nuclear equipment reliability and safety, and opening up new occasions for delay.