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The Scenic Hudson case is an important one in answer to your question. The Scenic Hudson case began 10 years ago and was remanded in 1965 to the Federal Power Commission. After remand, a voluminous record was developed. We are concerned with 1,800 megawatts of instant power which is badly needed in the northeastern area of the United States. The project was certified as of August in the unanimous decision that I wrote, and it was affirmed by the circuit court in a 2-to-l decision.

Senator BAKER. I think I understand your point of view, but I must confess, Mr. Chairman, that I still have a considerable concern for this problem.

If a man happens to live in these mountains that are being stripped, I suggest that he might put one set of values on it.

If he is looking at it from some distance, he might put a different set of values on it, but what we finally get down to is an overriding question that permeates all of these hearings, and that is who makes that balancing decision, that balancing judgment, and on what basis.

I think that is central and key to this whole inquiry, and I think NEPA is silent on those points.

For instance, does the FPC, in your view, make a judgment on the value of stripping of mountain land, and, if so how do you take into account the esthetic values of scenery.

Take the Cumberland Mountain region, its great resource is its scenic beauty. Does the Federal Power Commission take that into consideration?

Does it put a different set of values on the Four Corners situation, where surface mining is an entirely different breed of cat, because out there, instead of 40 or 50 inches of rainfall, they have 10 or less, and they are stripping flat land, and they are not degrading slopes, going into valleys and rivers.

Who makes these judgments, and if the Federal Power Commission does, if it is to be the lead agency, is it going to staff up as if it were the Bureau of Outdoor Recreation, or the Department of Interior itself would?

How are you going to do that?

Chairman NASSIKAs. We would have to rely on the Department of the Interior, which has jurisdiction as to Four Corners. In Tennessee, I am not quite sure whether that might be Interior also.

I know the Federal Power Commission does not have jurisdiction to determine the effect of strip mining. Remember that we do not license fossil fuel plants. Also, there is an issue as to our jurisdiction over fossil plants on appeal to the courts.

In Scenic Hudson, where we do have jurisdiction over a hydroelectric project on navigable waters, or nonnavigable for that matter, we spent about 16 hours viewing the area directly, by air, by land, and from the river. This is a subjective judgment, and I suppose so long as you have human beings, subjective judgment will be subject to question.

Senator BAKER. I am sure it will, but I am sure also the legislative mandate is properly narrow and defined.

Now, it seems to me, one might be able to appropriately conclude this line of inquiry by saying much of my concern in this respect of course comes from the Duter Continental Shelf case, in which the court specifically required the lead agency to consider alternatives.

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In the Outer Continental Shelf case, the court specifically mandated that Interior consider the possibility of changing import quotas, mining coal, strip mining of coal, hydroelectric plants and a whole range of things that somebody will have to consider.

Now, the range of these hearings is to determine how well equipped the lead agencies are to do this, and how clearly defined responsibility may be, but in another way, to see how exactly we can carry out the section 101 mandate of NEPA. I apologize once again for intruding on your time unduly at this point, Mr. Chairman.

I would ask you now to continue with the balance of your statement, unless you have something to add or unless Senator Fannin has another question.

Senator FANNIN. Mr. Chairman, one item that concerns Four Corners area, and I am very familiar with it, and it being so different from what my colleague from Tennessee has to be concerned with. We are so prone to criticize you, Mr. Chairman. Certainly this is true from the standpoint of my State and yet the same people criticizing you, do more damage to the beauty of our mountains and our areas of Arizona, indeed our whole Western area, by building homes on mountainsides and roads, and scarring the mountains forever. This is something that I have been very critical about. When we are not giving you full support in the work that you are trying to do, and yet, not doing at the State level what we are expecting you to do at the Federal level. I realize the problems you have in the Four Corners area and I also know the tremendous problems we have from the standpoint of developing power which as you know, is so vastly needed.

Chairman NASSIKAS. Thank you, sir.

Senator BAKER. Mr. Chairman, we have several established doctrines in administrative law that I might urge as a checkmate as to the determination of whether guidelines that I use are right or wrong.

Chairman Nassikas. You can examine alternatives ad infinitum and end up licensing nothing. So there have to be some reasonable alternatives: First, a rule of reason has to apply. Second, we must apply, the substantial evidence rule, which is ingrained into our administrative practice, after evidentiary hearings. Third, the principles of the Administrative Procedures Act, as interpreted by the courts, are checks as to whether or not alternatives were reasonably examined.

I believe that if some of the cases are sustained, on appeal to the Supreme Court of the United States, as to the extreme alternatives which have to be examined before a project can be certified, it will be necessary to request a change either in NEPA, or in the standards of some of the other acts, which govern the actions of Interior, or others, so that projects can be practically certified, otherwise they never will be.

Senator BAKER. Or as an alternative, the establishment of a single agency that can oversee the functions of the existing line agencies in the implementation of section 102?

Chairman Nassikas. Yes; the Department of Natural Resources might be that type of agency to which that kind of responsibility might be delegated, Mr. Chairman.

Senator BAKER. Thank you, Mr. Chairman.

Chairman NassikAS. NEPA will undoubtedly have a significant impact on our short-range power supply situation. Because of the long lead times and major investments involved in designing and constructing electric power generation facilities, both hydro and thermally powered, it is obvious that the public need for many plants now nearing completion or ready for operation in 1972 were presumably determined many months ago, even years before the enactment of the National Environmental Policy Act of 1969. In many instances, there are no available acceptable alternatives for these plants. 8

For the coming 1972 summer power peak period, and for succeeding winter and summer periods of the next 3 years, which are intermediate, there are prospects of genuinely serious and probably emergency situations as to adequate and reliable power supply if present powerplant completion schedules are not realized because of the indicated delays from environmental procedures, and in some cases other factors. Ťo summarize the problem, the following analysis of anticipated power needs is presented on the basis of data developed by our Bureau of Power with the cooperation of the National Electric Reliability Council operating in accord with the Commission's Order No. 383-2.

It covers: (1) The immediate program.-Nuclear and fossil fueled plants, 100 megawatts and larger, have been scheduled by various electric utility systems to meet expected peak power requirements of this summer, 1972. As shown in appendix A10 45 new power units, aggregating 26,000 megawatts of capacity, representing about one-third of planned reserve capacity are needed to operate on schedule if we are to avoid increasing the risk of inadequate power.

So far as we now know, most of these 45 units currently require water discharge permits to be issued by the Corps of Engineers with concurrence of EPA, and the 10 nuclear units require operating licenses from the AEC. The exact details of these project requirements are under close examination with the agencies concerned. But here, NEPA procedures and the controverted permit powers of the Corps of Engineers are both involved.

Based upon a detailed analysis of system requirements, our Bureau of Power has concluded that without some immediate relief through operation of such plants now being completed, there will be a major reduction in summer reserve margins to levels which have in the past resulted in power shortages. If relief is obtained, there is still some probability that certain areas will encounter power shortages because of past technical and construction delays.

(2) The midterm program.-Nuclear and fossil-fueled plants, 100 Mw and larger capacity, scheduled to meet power needs from the summer of 1972 through December 1975, total approximately 100,000

See, for example, the plants discussed in my statement at the hearings before the Committee on Interior and Insular Affairs, U.S. Senate, pt. 6, Nov. 10, 1971, pp. 2103-04, 2186-87.

* Order No. 383-2, Statement of Policy, Reliability and Adequacy of Electric Service Reporting of Data—Participation of Regulatory Personnel in Regional Councils, 43 FPC 515, Apr. 10, 1970, requires reports of projected system planning to be filed with the FPC 10 years in advance of construction. For the factual details of this administratively established program and the projected overall electric utility construction program, see my statement in hearings before the Subcommittee on Communications and Power, Committee on Interstate and Foreign Commerce, House of Representatives, 92d Cong., first sess., H.R. 5277 et al. (May 6, 1971), pp. 423-425, 432-446; and in hearings before the Subcommittee on Energy, Natural Resources, and the Environment, Committee on Commerce, U.S. Senate, 91st Cong., second sess. (Jan. 30, 1970), pp. 60–63. 145-169.

10 App. A appears on p. 365.

Mw, in 145 major generating units as indicated in appendix B, attached." Present scheduled dates for many of these units are in some jeopardy from the same factors, including NEPA procedures. Again, both nuclear plant licenses and water discharge permits for almost all units appear necessary, taking account of NEPA procedures.

(3) The long term program.- In the period 1976 through 1980, the FPC's National Power Survey has estimated that 150,000 Mw of new steam electric capacity will be needed, including major nuclear and fossil-fueled units. These are gross capacity additions. Information on specific plant additions is not available. In regard to the Midterm period of about the next 3 years, it is apparent we are dealing with a major industry program to meet projected needs of the public and the national economy for electrical energy supply.

The process will undoubtedly influence some changes in environmental design features and practices and will inform the public more fully as to the environmental and social cost of these projects. Our staff review of electric power load forecasts concludes that these power resources are required to meet demand. Clearly, the Nation's economic objectives set forth in the Economic Stabilization Act Amendments of 1971 (85 Stat. 743, Public Law 92–210) and in the Employment Act of 1946 (60 Stat. 15 U.S.C. section 1021, et seq.) cannot be attained unless realistically projected power requirements are met on a timely basis. The problem then is to meet the intent of NEPA's environmental discipline without letting the procedures themselves impair "the quality of the human environment considering all human values-social, economic, and physical.

In my judgment, for the long-term program we require legislation establishing State, regional, and Federal powerplant certification procedures under a comprehensive planning standard, incorporating the following essential principles of the administration's powerplant siting bill, S. 1684:

A. Recognition that the basic utility responsibility of electric systems includes as the primary initial duty of utility management an obligation to plan for adequacy and reliability of bulk power supply.

B. Recognition of the need for long-range planning by all electric suppliers (investor owned, publicly owned, and cooperatively owned), fully coordinated among all affected utilities and upon a regional basis, and with the planning results open and available to all, including the general public.

C. Recognition of the need for an inter-disciplinary approach to the planning process so that electric power resources, requirements, and environmental values affecting air, land, and water, are coordinated and balanced.

D. Recognition of the need for an established institutional mechanism or governmental framework (a "one-stop” concept) within which to resolve conflicting interests and values arising in electric resource development upon a timely basis so as to permit orderly growth of all electric suppliers (investor owned, publicly owned and cooperatively owned), and the completion of needed electric generating stations and interconnecting transmission networks in the time frames required for adequate and reliable electric power supply throughout the Nation.

11 Appendix B appears on p. 366.

E. Recognition of the need for an effective end or termination of arguments and disputes channeled into this institutional mechanism or governmental framework, including an expeditious processing of appellate reviews of administrative agency action, so as to permit the electric supplier (who is authorized to construct), to exercise the right of eminent domain, and a right of access to publicly owned sites in constructing certificated electric generating stations and transmission facilities.

F. Due process requirements and other appeals should be met in advance of construction to avoid costly delays.

G. Recognition of the need for an effective transitional process from the present state of the law governing electric powerplant siting to the time when Congress may prescribe the institutional mechanism or governmental framework for siting; and

H. In the event that State and regional agencies are not established consistent with effective procedures to safeguard the public interest in environmental protection and adequate electric supply, provisions must be made for Federal certification.

These principles are essential, in my opinion, to any workable legislative solution to powerplant siting problems.

In addition to your general concern, Mr. Chairman, about the application and implementation of NEPA, your February 24 press release indicates your interest in the specific programs and procedures adopted by agencies to comply with NEPA.

The Federal Power Commission has been implementing the policies of NEPA that relate to our jurisdictional activities in the formulation and adoption of general rules and policies and on a case-by-case basis. In addition, our cooperative and coordinating efforts with other agencies of government, State, as well as Federal, include measures and programs designed to implement NEPA and serve the protection and enhancement of the environment. I have presented two extensively documented statements on FPC efforts to implement NEPA to the Subcommittee on Fisheries and Wildlife Conservation of the House Committee on Merchant Marine and Fisheries. The last hearing before the subcommittee was held on February 17, 1972.12

Our efforts to apply the requirements of NEPA to our areas of jurisdictional concern can be summarized in three areas: (1) the adoption of NEPA procedural rules and their application to our jurisdictional cases; (2) the promulgation of rules and policies governing our activities and those of the industries within our jurisdiction; and (3) cooperative efforts with other agencies of Government in their environmental reviews and NEPA activities.

The Commission processes its cases pursuant to specific NEPA review procedures. I have attached our current NEPA regulations, Order No. 415-B, as amended by order of January 19, 1972, as Appendix C 13 to my statement. In the January 19 order, we granted rehearing for the purpose of further consideration of these regulations. This proceeding is currently before the Commission.

We have in Order No.415-B identified those areas of our jurisdiction that clearly require adherence to NEPA. The licensing and relicensing

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12 See also “Administration of the National Environmental Policy Act, pt. 1, pp. 215470, hearings before the Subcommittee on Fisheries and Wildlife Conservation of the Committee on Merchant Marine and Fisheries, House of Representatives, Dec. 9, 1970.

13 See p. 369.

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