Senator MUSKIE. As to whether health is in jeopardy?

Mr. LALOR. No.

Senator MUSKIE. You said that under circumstances in which the public health is in jeopardy, scrubbers of low-sulfur fuel should be mandated. I asked who should make the decision as to whether health is in jeopardy.

Mr. LALOR. I think the EPA has already set out the health standards and the welfare standards. It is our responsibility to meet them.

Senator MUSKIE. But you challenged them.

Mr. LALOR. No, I didn't challenge those. I am not challenging those, the ambient standards, whatsoever. I am challenging a uniform prescribed method for meeting those standards.

Senator MUSKIE. Let's try again. Where do scrubbers fit into the uniform method? When do they come in? Are they sufficiently developed and viable that they could be ordered in the worst cases this year, in your judgment?

Mr. LALOR. In the worst cases? For instance, for a powerplant in an urban area that had no other means to comply? It is probably a good idea.

Senator MUSKIE. Have you any notion at all how many that would involve?

Mr. LALOR. On our system?

Senator MUSKIE. Or across the country.

Mr. LALOR. No. I can only speak for our system.

Senator MUSKIE. If it involved as many as 2 or 3 dozen, would that be too many to use to test the technology?

Mr. LALOR. No, sir. Of course, we have some 40 or more than that number of experiments going on already around the country.

Senator MUSKIE. I know. You know, experiments are very popu lar this year. They delay hard decisions, among other things. I hope they have some useful benefits, too.

Mr. LALOR. I hope so, too. I don't think they are intended to delay hard decisions.

Senator MUSKIE. If these things involve such monstrous costs, why should we ever order them?

Mr. LALOR. The only reason I believe that a scrubber might become a good thing to do would be if that were the least expensive way at a particular plant

Senator MUSKIE. The least expensive way?

Mr. LALOR. Yes, sir. Let me finish my statement-the least expensive way at a particular plant of protecting the public health and welfare.

To get back, I think if the act focuses on protecting the public health and welfare, that is, meeting the ambient air quality standards, and gives us some flexibility as to how we do that-in some plants scrubbers may be the answer, and in other plants low-sulfur fuels may be the answer.

At many other plants, good design of the plant, a tall stack, good meteorological monitoring is the answer.

Senator MUSKIE. There is rhetoric in your statement as there was in Mr. Wagner's, and there may be in others, referring to the horrible, unconscionable cost requiring scrubbers. You have said you have no way of knowing how many worst cases would justify it.

I assume there may be enough worst cases to document your numbers on the cost. I just want to know what weight we should give to these costs. Should we ever consider making this kind of an investment, an investment that you describe as a rip-off on the public? Should we ever consider making that kind of investment which should be so required in the interest of public health?

Mr. LALOR. If it is required to protect public health, yes.

Senator MUSKIE. Then why isn't the emphasis on what is required to protect public health?

Mr. LALOR. Because I think that is what we are after.

Senator MUSKIE. It is kind of hard to get at it in your statement, may I say.

Mr. LALOR. I am sorry. Then I didn't do a very good job of explaining it.

Senator MUSKIE. Your job wasn't to please me. Your job was to state your position.

Mr. LALOR. It may be that the first part of it, if you had been able to hear it, would have made clear how we led into this point. The amount of money that I am talking about, by the way, is not for the country as a whole.

It is only for our system companies.

Senator MUSKIE. I understand that. Let me put it this way: If somebody other than yourselves were to make the health judgment, and were to decide that it would cost the kind of figures you presented in your statement, would you accept that judgment?

Mr. LALOR. Sure. We already have.

Senator MUSKIE. The Congress has already made the judgment, that public health requires the ambient air standards we have established and maybe more. We left it to the States to make the decisions as to whether more would be required in particular cases.

So you support standards but you are constantly and consistently against the means for implementing them.

Mr. LALOR. No, sir. We are against saying that there is only one means to comply.

Senator MUSKIE. Nobody has said that. Has EPA told you that there is only one means? Have I told you?

Mr. LALOR. No, sir, you certainly haven't.

Senator MUSKIE. Has the Clean Air Act said there is only one means? Yet notwithstanding the fact that we all agree there is more than one means, you want to change the act.

Mr. LALOR. Sir, the one means that I think are prescribed by the regulations that have been adopted by many States and by EPA require uniform emission limits for each and every plant in the country, regardless of whether they are located and how they are designed. Senator MUSKIE. I don't think that is so. That is true of new source plants but it is not true of existing sources. We impose requirements in New York City that are different than those imposed elsewhere.

Mr. LALOR. In most States in our area the existing plant regulations are uniform and do not take into account the location or design of the plant.

Senator BAKER. Mr. Chairman, if you would yield for a second, I might tell the witness that while I make no judgment on the propriety or impropriety of what he is talking about, he is now touching on a subject that was discussed at great length and debated very carefully back in 1970 when the act was drawn.

I am sure you remember that originally we had ambient criteria, which, in fact, said that you take advantage of the assimilative capacity of the atmosphere-when it gets to a certain level of dirtiness, make people do something about it, but if it doesn't get there, don't worry about it.

There were some who thought that was sort of unfair. Is there an inherent right to pollute? Does that give an inherent advantage, if it is an advantage, to a part of the country that has pristine pure air? Does that mean that industry can gravitate to that area and pollute it up to level of New York or New Jersey before you installed any pollution control devices?

That got to be quite a confrontation so we decided to compromise, which is not untypical of the Congress and sometimes even industry.

We decided that instead of having point source requirements for everybody, we would stay with the ambient standards, primary and secondary effects, for old plants, and we would have these new point source requirements for new plants.

That makes no sense at all from the control technology standpoint. It made a lot of sense from the legislative standpoint. In complaining about the uniformity, you are complaining about the same treatment for plants in New York City or plants in Utah or New Mexico.

You are touching on the most sensitive of all philosophical issues. That is, simply put, whether or not there is a vested right to pollute up to the assimilated capacity of the atmosphere.

Are all of us entitled to a little dirty air? Do we make do with the best we can do and try not to make matters any worse?

It is not quite as clear that uniform controls are bad, as appears to come to me from your statement. Once again, I am not passing judgment on the appropriateness of the clean air amendments.

I have frequently expressed my desire that we be realistic and flexible. Things have changed. I have a word of caution, if I may gratuitously put it, is don't pitch it on a philosophical necessity of uniform control.

I am interested in the pragmatic issue today. Let's look at it from that standpoint.

Mr. LALOR. Our statement is that the uniform control strategy that is required for all plants in our opinion is wasting our customers' money and it is exacerbating the energy crisis in the sense that we don't know what to do.

That is our concern. That makes it more than a philosophical argument. It makes it a very pragmatic problem where we are trying to buy fuel for 1980 and 1981 plants and we don't know what to do.

Senator BAKER. You have a very good case when you talk about the economic impact on your customers. You have a very good case on

the workability of the control schedules. In my humble and personal judgment, you do not have a good case when you start talking about the undesirability of a uniform control schedule. That was the burden of my remarks.

Mr. LALOR. I would like to discuss them further at some other time. Senator BAKER. I am sure we will.

Senator MUSKIE. I think it might be helpful if we proceed with the other statements. I think we are drifting into questions we might well put to any of the witnesses.

Mr. LALOR. If any of them can argue this or answer it better, I would appreciate their helping me.

Senator MUSKIE. We are trying to sharpen the issues so we can understand clearly where each of you stands. The committee will often find it difficult to understand a witness' point.

[Mr. Lalor supplied the following subsequent to the hearing:]

Mr. PAUL CHIMES,

SOUTHERN SERVICES, INC. Birmingham, Ala., May 30, 1974.

Committee on Public Works, New Senate Office Building,
Washington, D.C.

DEAR MR. CHIMES: Enclosed please find a copy I marked of the transcript of the May 13 hearings. I ask Dr. Harrison, our Vice president of Research, to review this material. His comments are offered in the following two paragraphs. At the present time, about 70% of the fossil-fueled plant capability of The Southern Company system is provided by plants so located as to be identified as point sources, making the application of supplemental control systems effective and relatively simple. In the remaining locations, though there are additional major sources of sulfur dioxide or particulates, it is feasible in every case to identify the relative contributions of each source to the total effect on ambient air quality and to contract among all sources to adopt some form of supplemental control systems if necessary to comply with ambient air quality standards during adverse weather conditions. Furthermore, all planned new fossil-fueled generating facilities to be added to The Southern Company system through 1980 will be located so as to be identified as point sources, increasing the feasibility of adopting supplemental control systems for power generation without the necessity of agreements for supplemental control systems with neighboring sources. In fact, present forecasts show that at the end of 1980, less than 18% of the fossil-fueled plant capability of The Southern Company system will be located such that application of supplemental control systems, if needed, will be influenced by neighboring sources.

With respect to the assimilative capacity of the atmosphere, it is clear that there are practical limits which should not be exceeded in order to avoid deleterious effects downwind from major sources of emissions. However, we are persuaded from observations near our generating facilities that there have been no deleterious effects from our sulfur dioxide emissions, and we are confident that we can stay well within the assimilative capacity of the atmosphere by various strategies to achieve ambient air quality standards. Furthermore, it should be pointed out that sulfur dioxide is unlike most other substances identified as pollutants, since there are recognized beneficial effects on vegetation and animal life derived from small concentrations of sulfur dioxide in the ambient air. This fact suggests that the national goal for sulfur dioxide control should simply be limited to maintaining concentrations in ambient air less than those which can be clearly shown to be harmful in some way.

Mitre Corporation is doing a study on the effect of our plants on the atmosphere and the role of sulfur oxides in the atmosphere. We expect to have this finished in early June and will forward it to you for the record and your consideration.

Sincerely,

35-4197 - 74 pt. 1 3

WILLIAM G. LALOR, Jr.

Senator MUSKIE. Let me ask Mr. Dowd if he would present his statement.

STATEMENT OF A. JOSEPH DOWD, VICE PRESIDENT AND GENERAL COUNSEL, AMERICAN ELECTRIC POWER SERVICE CORP., ACCOMPANIED BY PAUL D. MARTINKA, SENIOR VICE PRESIDENT, FUEL SUPPLY OF THE SERVICE CORP.

Mr. Down. Mr. Chairman, members of the subcommittee. My name is Joseph Dowd. I am vice president and general counsel of American. Electric Power Service Corp. The Service Corp. provides managerial, professional and technical services to the operating companies of the AEP system.

With me today to assist in answering any questions you may have is Mr. John E. Dolan, executive vice president, Engineering and Construction of the Service Corp., Mr. Paul D. Martinka, senior vice president, Fuel Supply of the Service Corp., and Mr. Robert W. Reeves, head of the Service Corp.'s Environmental Engineering Division.

While we support the goals and the purposes of the Clean Air Act, the act has given rise to some very serious, in fact, monumental problems not just for the AEP system for our Nation as a whole. Before getting into specifics, I would like to describe briefly the nature of the AEP system and the extent of its operations.

AEP is a large system. It has a generating capability of almost 14.5 million kilowatts and has, or soon will have, about 8.7 million kilowatts of additional capacity under construction. We serve in parts of seven States. Our service area ranges from the Blue Ridge Mountains of southwestern Virginia to the shores of Lake Michigan. More than 5.7 million people depend upon us for their electricity supplya responsibility that we take very seriously. We are located to a large extent atop the eastern coal fields with the result that 93 percent of our generation is coal-fired. Last year, AEP burned over 31 million tons of coal-second only to TVA.

In terms of engineering, the AEP system is characterized by large scale, super-critical generating units and what is probably the strongest transmission grid in the world. We rank first in the Nation in terms of generating efficiency, in other words, the very important ability to squeeze more kilowatt hours from a given amount of fuel than anyone else.

Our principal problems under the Clean Air Act are illustrative of problems facing the industry generally-and the Nation. While these relate to particulates as well as SO2, the overriding problem is compliance with the SO2 constant emission limitations. The ambient standard we are confident we can meet through the use of so-called "intermittent controls." However, the SO2 emission limitations are quite another matter. They can be met in only two ways: Either by removing the sulfur from the stack gas or from the coal before it is burned or by burning low sulfur fuel.

AEP's position on the status of flue gas desulfurization technology is well known and I need not belabor it here. Suffice it to say that it is our engineering judgment and that of the best independent en