Los Angeles reactor, and the Connecticut Yankee reactor. Those are the main three, plus finishing up on the other reactors such as Hallam and Piqua and those that have been in the program.

Mr. EVINS. The justifications state the Commission has currently under negotiation three proposals for research and development and design assistance for large-sized reactor plants; namely, southern California, city of Los Angeles, and Connecticut Yankee.

Dr. PITTMAN. Yes, sir. A portion of this $9.2 million is to take care of the funds which will be necessary for those.

Mr. EVINS. How much was negotiated in 1963?

Dr. PITTMAN. All of the funds which were in 1963 have slipped into 1964, because the only one we have negotiated was Southern California Edison, and we have slipped that into the 1964 column, sir.

Mr. EVINS. How much of the $9.2 million goes to each of these three companies? Can you give us the exact status of each of the proposals?

Dr. PITTMAN. Yes, sir, I can. The Southern California Edison proposal has been negotiated for some time and has been held in abeyance pending the resolution of their site problem. They have not been able yet to get all of the necessary legislation which they will have to get in order to use Camp Pendleton. When that has been negotiated, we have the figures and we know exactly the work that is to be done.

With regard to the Connecticut Yankee, we have negotiated the amount of design assistance that is to be given to that reactor. There is no research and development. We know the amount of use charge.

In the case of Los Angeles, we are in the last stages of negotiating the details of the amount of design assistance that is to be given to that reactor. We know the amount of waiver of use charge. There is no research and development for that reactor.

Mr. EVINS. Will you require and need the full amount of $9.2 million next year?

Dr. PITTMAN. I think we will, yes, sir, to the best of our knowledge at this point.

Mr. EVINS. Can you supply now the amount that will go to each of the plants?

Dr. PITTMAN. I would like to supply that for the record, if I may. I do not have it.

Mr. EVINS. Will you need more funds in the future, or will this be the total amount?

Dr. PITTMAN. No; this is not the total amount. This is only the cost to be incurred in fiscal year 1964.

Mr. EVINS. The committee would like to know the full cost.

Dr. PITTMAN. We will give you for the record the full cost. The reason I cannot give it to you right at this moment is that we are still negotiating the final figures with the city of Los Angeles. Until that is done, I could not give you the total cost.

(The information requested follows:)

22-502-63-pt. 6-12

1 R. & D. assistance, including Government furnished services. Design assistance.

'Design assistance, amount requested by city of Los Angeles, in process of negotiation.

Mr. EVINS. What funds have been obligated thus far on your Euratom program?

DESIGN ASSISTANCE AND WAIVER OF FUEL CHARGES

Mr. BOLAND. May I ask a question with respect to the program we were on? Who contracts to build the reactors? Do you or do the private utilities?

Dr. PITTMAN. The private utilities make the selection and contract to build the reactors. After they have made the selection under this particular program, they then come to us and ask for the design assistance. The design assistance is assistance toward the design of the reactor itself.

In this case, since essentially the same reactor is being used in both cases, we have had to negotiate concurrently with Yankee and the Los Angeles people.

Mr. PILLION. Who are the largest constructors of reactors?

Dr. PITTMAN. The Westinghouse Co., General Electric Co., Babcock & Wilcox, Allis-Chalmers, Atomics International, and General Dynamics.

Mr. PILLION. They are in the business of building these reactors. Dr. PITTMAN. Yes.

Mr. Chairman, if I could go off the record because of the fact that we have not finished negotiation, I could give you some figures that would be a pretty close answer. Would you like me to do that?

Mr. EVINS. That is all right. We understood you have some funds carried over from last year.

(Off the record.)

Mr. BOLAND. I do not know why we should give this type of assistance. Because of the state of the art and the direction in which we are traveling, and the very commendable and magnificent job the AEC has done in this area, I cannot understand why we have to give this kind of assistance to these companies. There isn't any question about the fact that private utilities in high-cost areas are getting into this program. I do not know whether that will be reflected in reduced cost to the consumer in the New England area, particularly with respect to Yankee Atomic and Connecticut Yankee. I just think there ought to be some way of getting back the money that we have put in for design assistance, and there ought to be some way of getting back the money on the waiver of use charges which do not have to be paid by the utility.

Mr. EVINS. The committee has felt this way for some time, yet they continue to go on. If it were in the experimental and developmental stage, that would be a little different, but we are now told they have pretty much consolidated on an efficient, effective, and productive type. We have been trying to urge the Atomic Energy Commission Reactor Division to build some large-scale reactors themselves, but apparently it is easier to turn the money over to the private utilities and let them do it.

Dr. PITTMAN. It also saves about $90 million per reactor to do it this way. We are not operators of power stations. We could not use the power in our own facilities.

I think in this case, Mr. Chairman and Mr. Boland, the situation is pretty well reflected in the report to the President; namely, we feel that we are at a point where a little bit of assistance can make all the difference in the world in the time at which these companies build. I think it is a question of judgment whether they would build now or 2 years from now.

If they do not build now, then you have the loss of impetus in these companies which are extremely enthusiastic right now-not only the equipment manufacturers, who clearly are doing everything they can to sell, but more importantly, the users, the utility companies, who are interested in the fact that Yankee is going ahead and doing this, who are interested in the fact that Connecticut Yankee is operational with a relatively small amount of assistance. Surely, it is $6 million they would have had to spend themselves.

(Off the record.)

Mr. EVINS. You are programing only $9 million here.

Dr. PITTMAN. The $9 million is the cost in 1964, sir. The rest of the costs will be in subsequent years.

Mr. EVINS. Will you tell the committee the total of the funds available for this program in fiscal year 1964?

Mr. CORSO. New money for this program in the amount of $15 million is included in our appropriation request for fiscal year 1964. We have available $21 million in fiscal 1963, of which these three contracts will take the major portion.

Mr. EVINS. How much are you carrying over in this program from 1963?

Dr. PITTMAN. $21 million.

Mr. CORSO. We will not be letting those contracts this year.

Mr. EVINS. You have $21 million plus this.

Mr. CORSO. Plus the $15 million.

Mr. EVINS. Do you need all this?

Dr. PITTMAN. The $21 million-the $18 million, roughly, we just talked about-carries us through the 1963 program. We are certainly of the opinion that, going into 1964, we should be in a position to continue the type of leadership that I think we have given, asking for proposals on certain types of reactors and, further, accepting unsolicited proposals in those areas of reactor development where utilities. are ready to move ahead if we will help them with R. & D. on such things as the gas-cooled reactor. It is quite likely that somebody like the Rochester Gas & Electric Co., which is very enthusiastic about a peach-bottom-type reactor, might well build one if we can give them a little assistance.

Mr. EVINS. $15 million is funded for this program. I can imagine that would stimulate a lot of enthusiasm.

Dr. PITTMAN. If we carry out the three programs I mentioned for 1963, the total amount of money we would have available if we get what we are asking for in the 1964 budget, would be $15 million, Mr. Chairman. This $15 million we think would allow us to assist in two or a maximum of three. If we get one small reactor, say the Fitchburg power and process heat reactor, for example, which has been talked about for several years, then we might get two others. If we get two normal-sized reactors, the $15 million would just about take it. We feel if the AEC could not sponsor and stimulate commercialscale reactors by the R. & D. and the waiver and possibly by design assistance, it would put us in a weak position at this particular point

in time.

Mr. EVINS. You have $15 million funded, $18 million other, and you have an excess of $5 to $8 million that you will not need and are just carrying it, hoping others will come in.

Dr. PITTMAN. No, sir. Let me say it my way, and then the finance people can explain it to you. The total amount of money that I would have available in 1964

Mr. EVINS. That is not already committed.

Dr. PITTMAN. That is not already committed to these projects and the others we have been working on for several years, if you give us the amount of money we are asking for, is $15 million total.

Mr. EVINS. That is what you have.

Dr. PITTMAN. That is what I would have if you give us what we are asking for.

Mr. EVINS. The $9.202 million.

Dr. PITTMAN. No, a portion of the $9.202 million is the expenditures against the $21 million that we have from previous years. That is all committed and gone on previous projects. I am asking in this budget for the ability for the Commission to participate next year in some new programs such as a gas-cooled reactor that Rochester might want to build and we hope we can talk them into building, such as the reactor that the Jersey Central people are thinking about building, such as the Golden Valley Authority up in Alaska. This is a small public power group that is very close to being competitive. Maybe with a little design assistance they could go over the top.

If we do not have this kind of money available, there will be a lag in the industrial applications.

Mr. PILLION. Just to get a perspective that I do not have, how big a plant will the Los Angeles project be?

Dr. PITTMAN. Approximately 500 megawatts.

Mr. PILLION. 500,000 kilowatts capacity?

Dr. PITTMAN. Right.

Mr. PILLION. What will be the cost of that to them?

Dr. PITTMAN. About $90 million.

Mr. PILLION. How much aid will you give them? Break it down into research and development, waiver of use charge, and so forth. How much aid will you be giving to them?

Dr. PITTMAN. The total assistance that we would be giving to them in research and development is zero dollars. The total assistance we would be giving in the waiver of fuel charges is about $8.2 million over a 5-year period. This is the waiver of the charge that they would pay us. The design assistance is still under negotiation. It is in the $6 million to $8.5 million range.

Mr. PILLION. Out of an expenditure of $90 million, you will be giving them direct assistance of about $15 million over the course of the next few years.

Dr. PITTMAN. The $90 million is the construction cost. They then have operating costs as well, sir. It is toward that that the waiver applies.

Mr. PILLION. It does not matter, they get that amount of assistance, whether they apply it to one or the other, and it comes out of the same pocket.

Dr. PITTMAN. Right.

Mr. PILLION. Does that apply also to the Connecticut Yankee in about the same ratio?

Dr. PITTMAN. Just about the same.

Mr. PILLION. With that assistance and aid, what will be the estimated cost in mills of their power?

Dr. PITTMAN. It will be in the range of 6 mills. Southern California and Los Angeles will have public financing, and the Connecticut Yankee will use private financing. It is in the range of 6 to 6.5 mills for the Connecticut Yankee plant with private financing.

Mr. PILLION. That is all.

Mr. EVINS. How much more money do you think you need and require that this committee should appropriate for these other demonstration projects for next year?

Dr. PITTMAN. I would like to have the ability to obligate $15 million next year.

Mr. CORSO. I think I can explain this, sir. Dr. Pittman would like $15 million available to let contracts, to obligate Government funds. Of that $15 million, there will be $3 million expended in fiscal year 1964. The balance will be expended in subsequent years.

Of the $9.2 million which you were looking at in addition to the $3 million I just mentioned, there is $6.2 million which represents expenditures in 1964 against contracts that Dr. Pittman had anticipated he would let in fiscal year 1963. It now appears those contracts will slip over until the early part of fiscal year 1964.

Mr. EVINS. Those are all committed? The $9.2 million is all committed?

Mr. CORSO. If this had gone on schedule, $6.2 million of the $9.202 million would have been committed in fiscal year 1963, and $3 million represents costs estimated against the $15 million of obligational authority requested for fiscal year 1964.

Mr. EvINS. You want $15 million new obligational authority, including the $9.202 million of expenditures?

Mr. CORSO. That is right, sir.

Dr. PITTMAN. Of which $3 million would be expended from that $15 million, sir.