derway 935,000 kilowatts of high efficient steam plants. They are on an interconnected system, which incidentally has the approval and blessing of the SEC.

We are a single integrated system, composed of some four or five companies, but from a practical operating sandpoint, operate as a single unit.

You heard Colonel Schiedenhelm mention the hydro plants that we have. On the Kanawaha River in West Virginia, the Government built three navigation dams back in 1934 to 1937. Our company took licenses from the Federal Power Commission and built the power stations, put in the machinery and pays the Government an annual fee for the use of that water. It has been a very satisfactory arrangement from the standpoint of both the Government and our company. Now the Smith Mountain project is one that gives us a great deal of concern. My friend, Congresman Stanley, says that it is nothing for us to worry about. In a conversation with him the other day, he said, "Claytor, this is simply an authorization. It may be years before this project is built. So why are you worrying about it now?"

I told him that we had had experience before in going before an appropriation committee, trying to fight an appropriation for a hydro plant, and we were aways told, "Why did you wait until the Committee on Appropriations had to handle the matter? Why didn't you take it up with the committee that was authorizing the project?" That is one of the reasons that we are here today.

Now, getting back to the power shortage, we are constantly trying to get more business. We haven't fired a salesman last year. For instance, we sold, together with the dealers, 75,000 electric ranges and water heaters on our system. We are going out and beating the bushes to get business, and the thing that is giving us concern right now is finding the load for this enormous program that we have got on. I think it is very easy to understand why we are worried when we see projects like this being considered.

Mr. PICKETT. May I interrupt you, Mr. Claytor? It was my understanding, and if I am in error, I certainly want to be corrected, that the statements in reference to the estimate by the Federal Power Commission of the shortage of power in the area dealt with the situation that confronted the Commission at the time the report was transmitted, based on 1941 or 1942 figures. Was that your understanding or am I incorrect about it?

Mr. CLAYTOR. I don't know, Mr. Chairman, because I did not see the letter that Congressman Stanley submitted in the record. I don't know what the Power Commission said except that I understood this morning that the Power Comission agreed with him that there is a power shortage in this area and that by 1958, there will be still more shortage, and that is the thing I can't understand. What do they think we are going to do in the meantime?

Mr. PICKETT. That sort of gets into the point I wanted to ask you. Has there been some additional power provided by your company and other companies for similar purposes since about 1942?

Mr. CLAYTOR. Oh, my, yes. From 1939 until 1945, my company installed 800,000 additional kilowats, and we now have another 935,000 kilowatts under construction. The 1st of July we expect to bring in a unit of 137,500 kilowatts. The 1st of October we expect to bring

in the new Philipsporn plant, with a first unit of 137,000 kilowatts. Incidentally, that plant will actually produce a kilowatt-hour from three-quarters of a pound of coal. It has only been a few years that the engineers' goal was 1 pound per kilowatt-hour. We have already passed that. And, speaking of getting business, Mr. Chairman, we have actually been in touch with the Aluminum Co. of America seriously to try to interest them in establishing an aluminum plant on our lines of as much as 200,000 to 300,000 kilowatts of capacity; whether we are going to be successful or not, I do not know, but we are ready to take it on.

That is the gist of what I have to say, that we have all the power that is needed. We sell it on a competitive basis and we are looking for business. I would like permission of the chairman to file a report which was issued by the general manager of the Appalachian Electric Co. on the power situation in Virginia and West Virginia. It gives a complete story with the maps.

Mr. PICKETT. Without objection, that will be inserted in the record at this point.

(Statement submitted by Mr. Claytor follows:)

ADEQUACY OF POWER SUPPLY IN THE TERRITORY SERVED BY APPALACHIAN POWER CO.

Much has been said recently about an alleged power shortage in Virginia, including the Danville and Martinsville areas. Here are the facts as concerns the territory in which Appalachian Electric Power Co. supplies power:

There has been neither refusal nor curtailment of power to any customer of Appalachian Electric Power Co. and it is expected that there will not be any. To be sure, demands for electricity have increased rapidly since the war, but the company has been carrying out, and has still under way, a very heavy expansion program.

Appalachian Electric Power Co. serves 30 counties in south central and southwestern Virginia and 21 counties in central and southern West Virginia. The largest cities served by the company in Virginia are Lynchburg and Roanoke; in West Virginia, Charleston, Huntington, and Bluefield. The compay has interconnections with and sells power to the cities of Danville, Salem, Martinsville, and Radford and the town of Bedford in Virginia. Although in those cases there are municipal power systems which serve various industries, yet at Danville the company serves directly the Dan River cotton mills; in Martinsville and vicinity it serves directly many industries, including a cotton mill, about a dozen furniture factories, and so forth.

It has from the beginning been the policy of the company to carry on aggressive load-building campaigns, for all classes of service. Service has been refused to no one. Instead, the company has been actively engaged in promoting the demand for electricity, including the bringing in of new industries and this has been equally true since the end of World War II.

The Appalachian Electric Power Co. is one of a group of electric power companies which operate as a part of the integrated system of American Gas & Electric Co. These systems of the individual operating companies are physically interconnected by high-capacity, high-voltage transmission lines. Power supply is coordinated in such a way that each company in the group supports and is supported by the others. Therefore, an adequate power supply for the Appalachian system means that there is also an adequate power supply for the entire American Gas & Electric system. Likewise, any discussion of the adequacy of power supply for the Appalachian Co. must include a discussion of the power supply for the American Gas & Electric system.

The generation and transmission facilities, as well as the service area, of Appalachian Electric Power Co. are shown in figure 1. Figure 2 shows the generating and transmission facilities of the American Gas & Electric Co.'s entire integrated system, of which system the Appalachian Co. is a part.

During the war years, when strategic materials were drastically restricted, electric utilities were allowed only the equipment and materials specifically required to provide for the increase in load caused by the war. During that period, the American Gas & Electric system received governmental permission to expand

its generating facilities by over 800,000 kilowatts, i. e., to meet the increased war demands for power in its territory.

Moreover, although a decrease in load immediately following the war was anticipated, American Gas & Electric Co. at once went ahead with its postwar plans, foreseeing a great increase in power demands over the following years.

What has happened to the demands on the company for electricity during the latter part of and since the war is shown in figure 3. At the end of the war it was predicted, in both governmental and private circles, that the tempo reached in 1945 would not be exceeded before 1948. It will be seen from figure 3 that the demand on the system of American Gas & Electric Co. passed the war peak in 1946, and in 1949 was 30 percent above the wartime peak. At present business seems to be leveling off, but Appalachian and its affiliated companies are optimistic about the future and have not slowed or reduced their expansion program. Because of the length of time required to obtain and install new facilities, the strain on facilities during and since the war has been great. This condition was discussed frankly with the customers of the company, who were assured that, nevertheless, barring unforeseen major accidents, their loads would be carried. Actually, as stated above, there has been neither refusal nor curtailment of service.

During the period 1945 through 1948, 430,642 customers were added on the American Gas & Electric system. Of this total, 113,521 were added by Appalachian Electric Power Co. Of the latter, 61 percent were rural customers.

The growth in power demand on the American Gas & Electric system and in the generating capability to meet these loads is shown in attached table I. That table shows also the estimated power demands through 1951 and the corresponding generating capability based on the present expansion program. Clearly, the critical condition was reached in 1948-and successfully met. Gradually the margin of reserve is increasing. By the time the peak demand of 1951 is reached, the margin will be about 17 percent.

The expansion program now under way will, for the years 1945 through 1951, amount to over $400.000,000 for the American Gas & Electric system. Of the total, Appalachian Electric Power Co. will have made expenditures amounting to about $160,000,000. The complete program includes 935.000 kilowatts of new generating plant and the necessary transmission, distribution, and general plant facilities. The new generating equipment will be installed at locations and in amounts as follows:

Appalachian Electric Power Co. will own two of the four 137,500-kilowatt units at the Philip Sporn plant. So far as is known, these, along with the others being installed on the American Gas & Electric system, will be the most efficient steam electric-generating units in the world.

In summary, Appalachian Electric Power Co. is equipped to furnish, within its market territory in Virginia and West Virginia, additional power at the most optimistic rate of growth of the demand. Its large electric plant at Glen Lyn, Va., the Claytor hydro plant on New River in Virginia, its smaller hydro installations, its large steam electric plants in West Virginia, including the ultramodern Philip Sporn plant, and the advantages of operation in coordination with the remainder of the entire American Gas & Electric Co. system afford an ample supply of power. Its heavy-capacity transmission lines to load centers assure reliability of delivery of power to its customers.

In fact, the company is looking well beyond 1951 in its planning of facilities to meet the ever-growing uses of electricity within its service areas.

M. C. FUNK,

Vice President and General Manager, Appalachian Electric Power Co., Roanoke, Va.

NOTE. The peak loads, as shown in figures (kw.) for the respective years, are adjusted to reflect elimination of interruptible on-peak deliveries.

TABLE I.-American Gas & Electric Co. growth in generating capability and

2 Actual demand of 60-minute duration, including interruptible power.

Mr. CLAYTOR. The committee might also be interested to know what we have done for the farmers.

We have at the present time about 303,000 farms that we are supplying power to, and just last year, 1948, our one company, the Appalachian Electric Power Co., added 28,000 farms to our system, and we are looking for 28,000 more farms. Thank you very much. Mr. PICKETT. Are there any questions of Mr. Claytor?

Thank you, Mr. Claytor.

(At this point, there was discussion off the record.)

(The following communications were subsequently submitted:)

Hon. WILLIAM WHITTINGTON,

Chairman, Works Committee,

ROANOKE, VA., May 26, 1949.

House of Representatives, House Office Building:

As one who in general principle dislikes to see our Government and business in competition with privately owned industry, I wish to express the hope that you will use your efforts to defeat a bill which provides for the dam in Roanoke