Federal Power Commission

Hurley-Wright Building, 1800 Pennsylvania Avenue NW.
EXecutive 0100

Chairman Basil Manly
Vice Chairman Leland Olds
Commissioner Claude L. Draper
Commissioner John W. Scott
Commissioner Nelson Lee Smith
Secretary Leon M. Fuquay
General Counsel Charles V. Shannon
Assistant General Counsel Howard E. Wahrenbrock
Assistant General Counsel Harry S. Littman
Executive Assistant to the Chairman Calvin Dold
Chief Engineer Roger B. McWhorter
Chief, Bureau of Power E. Robert DeLuccia


Chief, River Basin Division Frank L. Weaver
Chief, Electrical Division Claudius E. Bennett
Chief, Licensed Projects Division W.R. Farley
Chief, Projects Cost Division Eugene Logan
Chief, Bureau of Accounts, Finance, and Rates Charles W. Smith
Chief, Division of Accounts Walter E. Baker
Chief, Division of Finance and Statistics E.G. Craig
Chief, Division of Rates and Research Edgar S. Coffman
Chief, Division of Original Cost R.C. Rainwater
Budget and Fiscal Officer J.B. Turner, Acting
Chief, Publications Division R.A. Seelig
Director of Personnel J.B. Turner
Chief, Information Division John W. Jenkins
Chief, Division of Trial Examiners

Creation and Authority.--The Federal Power Commission was organized as an independent commission in its present form by the act approved June 23, 1930 (46 Stat. 797). The Commission was originally created in 1920 by the Federal Water Power Act, approved June 10, 1920 (41 Stat. 1063; 16 U.S.C. 791-823), providing for the licensing by the Commission of hydroelectric projects on United States Government lands or on navigable waters of the United States. The Federal Water Power Act was amended March 3, 1921, to exclude water power projects in national parks or national monuments (41 Stat. 1353). By title II of the Public Utility Act of 1935, approved August 26, 1935, (49 Stat. 838; 16 U.S.C. Sup. IV, 791a-825r), the original Federal Water Power Act with certain amendments was made part I of the Federal Power Act and parts II and III were added, vesting the Commission in addition with jurisdiction over the transmission and sale at wholesale of electric energy in interstate commerce and public utilities engaged therein.

Other jurisdictional statutes of the Commission are: Natural Gas Act, approved June 21, 1938 (52 Stat. 821; 15 U.S.C. 717-717W), giving jurisdiction over the transportation and sale of natural gas in interstate commerce for resale and natural gas companies engaged therein, as amended February 7, 1942 (56 Stat. 83; 15 U.S.C. 717f); Tennessee Valley Authority Act, approved May 18, 1933 (48 Stat. 58; 16 U.S.C. 831-831dd), sections 12a, 14, 15, 15a, 15c, 26a, as added or amended (49 Stat. 1076, 1077, 1078, 1079, 53 Stat. 1083; 16 U.S.C. 831k, 831m, 831n, 831n-3, 831y); Bonneville Act, approved August 20, 1937 (50 Stat. 731; 16 U.S.C. 832-832L); Fort Peck Act, approved May 18, 1938 (52 Stat. 403; 16 U.S.C. 833-833k); Flood Control Act of 1938, approved June 28, 1938 (52 Stat. 1215, 1216; 33 U.S.C. 701j); Flood Control Act of 1939, approved August 11, 1939 (53 Stat. 1415; 33 U.S.C. 701b-4); Flood Control Act of 1941, approved August 18, 1941 (55 Stat. 639; 33 U.S.C. 701j); Boulder Canyon Project Act, approved December 21, 1928 (45 Stat. 1057; 43 U.S.C. 617-617t); Act Relating to Fort Apache and White Mountain Indian Reservations, approved February 28, 1929 (45 Stat. 1344); acts relating to Flathead Indian Reservation, approved March 7, 1928 (45 Stat. 200, 212-213) and amended March 4, 1929 (45 Stat. 1623, 1639-1640); Inflation Control Act of 1942, approved October 2, 1942 (56 Stat. 765; 50 U.S.C. 961).

Executive Order 8202, dated July 13, 1939, authorized and requested the Federal Power Commission to perform certain functions relating


to the transmission of electric energy between the United States and foreign countries and to the exportation and importation of natural gas from and into the United States. Executive Order 9165, dated May 19, 1942, designated the Federal Power Commission to perform certain specified duties in the development and execution of the Facility Security Program with reference to power, gas irrigation water, and related facilities and anti-sabotage measures. Executive Order 9437, dated April 18, 1944, revoked Executive Order 9165, but stated that such revocation shall not be deemed to preclude any necessary cooperative arrangement with respect to facility security between the War Department and any agency such as the Federal Power Commission named in paragraph 3 of Executive Order 9165. Executive Order 9328, dated April 8, 1943, directed the attention of the Federal Power Commission, as a Federal rate regulatory authority, to the stabilization program so that rate increases will be disapproved and rate reductions effected "in order to keep down the cost of living and effectuate the purposes of the stabilization program." Executive Order 9373, dated August 30, 1943, requires approval by the Federal Power Commission of rates for sale of electric energy from the Grand River, Denison, and Norfork Projects by the Secretary of the Interior.

Purpose of Part I.--Part I of the Federal Power Act represents the declared policy of Congress to provide for the development and improvement of navigation and the development, transmission, and utilization of power on streams subject to Federal jurisdiction, upon lands of the United States, and at Government dams, by private and public agencies acting under licenses issued by the Commission. Such licenses may be issued only after satisfactory evidence has been submitted that the applicant has complied with the requirements of specified State laws; and if the navigable capacity of any navigable waters of the United States will be affected, only upon the approval of the plans for the project by the Chief of Engineers and the Secretary of War; or if a reservation is affected, only upon such conditions as the secretary of the department under whose supervision it falls shall deem necessary for its adequate protection and utilization.

Licenses so issued are subject to the following conditions: to effectuate the foregoing policies; to protect reservations of the United States; to adapt each project ot a comprehensive plan for improving or developing a waterway or waterways for interstate or foreign commerce, for the improvement and utilization of water power, and for other beneficial uses, including recreational purposes; to reimburse the United States for the cost of administration of part I of the act and to recompense it for the use of lands; to expropriate excessive profits until the States shall make provision for their prevention or expropriation; to provide for the payment of assessments for benefits from headwater improvements; to give the United States the option to recapture licensed projects at the expiration of the licenses; to obtain the maintenance and operation of navigation facilities and fishways; and to provide for reasonable regulations of rates, services, and security issues of parties involved, in the absence of State regulation. The act also provides for investigations of unlicensed projects subject to Federal regulation and the issuance of orders in the public interest to conserve and utilize navigation and water power resources.


Purpose of Part II.--Part II of the act embodies a comprehensive scheme for the regulation of electric utilities engaged in interstate commerce. The policy is to extend Federal regulation to matters which cannot be regulated by the States and also to exert Federal authority to strenghthen and assist the States in the exercise of their regulatory powers. In general, the regulatory provisions of the act apply to persons owning and operating facilities for the transmission of electric energy in interstate commerce or for the sale of electric energy at wholesale in interstate commerce, with certain exceptions--for example, facilities used in local distribution. Provision is made for the encouragement of voluntary interconnection and coordination of facilities; for compulsory interconnections under certain circumstances; for authorizing transmission of electric energy from the United States to a foreign country when it will not impair the sufficiency of electric supply within the United States or impeded or tend to impede coordination of facilities; for the approval of the transfer of assets, under certain conditions, involving companies subject to the jurisdiction of the Commission; for the approval of the issuance of long-term securities in accordance with specified standards, and for the scrutiny of the issuance of short-term securities, involving companies subject to the jurisdiction of the Commission where the companies are not organized and operating in a State under the laws of which its security issues are regulated by a State commission.

Further provisions apply to the charging of just, reasonable, nondiscriminatory and nonpreferential rates in connection with the transmission or sale of electric energy subject to the jurisdiction of the Commission, and to the furnishing of proper, adequate, and sufficient service in the interstate transmission or sale of electric energy.

Purpose of Part III.--Part III of the act provides for the prescribing and enforcement of compliance with a Uniform System of Accounts by licensees and interstate electric utilities, reclassification of accounts, regulation of depreciation and like accounting matters. It also requires approval of the holding of interlocking positions in the companies subject to the jurisdiction of the Commission, in security underwriting companies, and in electrical equipment supply companies when neither public nor private interests will be adversely affected thereby. Part III also contains provisions for the hearing of complaint cases, the instituting of investigations, conduct of hearings, and the review of Commission order by the courts.

The Tennessee Valley Authority Act, the Bonneville Project Act, and the Fort Peck Project Act provide for the creation of various Government hydroelectric power projects, each of which is subject, in various phases of its operations, to the supervision and authority of the Commission.

The Natural Gas Act is intended to regulate those engaged in the transportation of natural gas in interstate commerce or the sale in interstate commerce of such gas for resale for ultimate public consumption for domestic, commercial, industrial, or any other use.

The policy of Congress in this connection is to extend Federal regulation to certain phases of the business of transporting and selling natural gas for ultimate distribution to the public which cannot be regulated by the States, also to assert Federal authority to strenghthen and assist the States in the exercise of their regulatory powers. Provision


is made for control over the exportation and importation of natural gas; for control over rates and charges; determination of the cost of production or transportation of natural gas and ascertainment of cost of property of natural gas companies engaged in interstate commerce; extension of facilities and abandonment of service by natural gas companies; investigation of compacts proposed to Congress by two or more States dealing with the conservation, production, transportation, or distribution of natural gas; establishment of joint boards representing States affected in any particular matter, and for furnishing necessary reports and information.

1942 Amendment of Section 7 of Natural Gas Act.--Section 7 of the Natural Gas Act was amended February 7, 1942 (56 Stat. 83), to require a certificate of public convenience and necessity for new construction, extension of facilities, or acquisition or operation of new facilities or extension by a natural gas company subject to the act. Provision was made for the issuance of such certificates to all natural gas companies bona fide engaged in operation subject to the jurisdiction of the Commission on February 7, 1942, covering existing operation. Further provision was made for issuance of temporary certificates in certain cases and the determination of the service area of natural gas companies subject to the act.

Under the Flood Control Act of 1938 and other statutes, the Commission makes recommendations to the Secretary of War concerning the installation of penstocks or similar facilities adapted to possible future use in the development of hydroelectric power in dams constructed under the act.

Organization.--The Commission is composed of five members, one of whom is elected chairman, and another, vice chairman. The chairman is designated by statute as the principal executive officer of the Commission. The commissioners are assisted by a group of examiners in the matter of presiding at and conducting hearings. The principal administrative subdivisions of the Commission are the office of the Secretary, the Budget and Fiscal Office, the Director of Personnel, and the Publications Division. The Commission's technical staff is divided into the Office of the Chief Engineer, which advises the Commission on engineering matters; the Bureau of Power, comprising four divisions, which supervise power requirements and supply, and handle flood control and licensed projects work; the Bureau of Accounts, Finance, and Rates, which supervises the preparation of systems of accounts, auditing and accounting, inquiries into existing rates and charges, and similar work, with various divisions which handle specific portions of the general work of the Bureau; the Bureau of Law, which advises the Commission on all legal questions; and the Division of Trial Examiners.


Federal Power Act

Declaration of Intention.--Upon the filing of declarations of intention to construct project works on streams or their parts, other than those defined as navigable waters, and over which Congress has


jurisdiction, the Commission makes investigations and adopts findings as to whether the interests of interstate or foreign commerce would be affected by the proposed construction.

Preliminary Permits.--Upon applications filed, the Commission, in proper cases, issues preliminary permits and renewals for the purpose of maintaining priority of application for a license for a total or not more than 3 years.

Licenses.--Upon application, the Commission, in proper cases, issues licenses and amendments thereto, approves their transfer, and fixes and collects annual charges for them.

Cost Determination Cases.--The Commission is required by the act to determine the net investment in and acutal legitimate original cost of every licensed project for use in event of recapture of the project by the United States as well as in connection with various phases of regulation such as rate regulation.

Recapture of Licensed Projects.--The act provides that the United States shall have the right to recapture licensed projects upon or after expiration of any license. The proportion of surplus earnings in excess of a specified reasonable rate of return is determined by the Commission and is to be held until the termination of the licensse or to be applied from time to time in reduction of the net investment of the licensee, which is to be paid by the United States in the event of recapture. The Commission fixes the amount of such specified rate of return. It prescribes and enforces a system of accounts to be maintained by licensees.

Rates, Services, and Securities of Licensees.--Licensees and their customers and subsidiaries which are interstate public utility companies are subject to the provisions of part II.

The Commission, under part II, has jurisdictionover the transmission of electircal energy in interstate commerce and over the sale of electrical energy at wholesale in interstate commerce. This part provides for close cooperation with State agencies with respect to the rates and services of electric utlities.

Headwater Benefits.--In cases where a licensee or other power developer benfits directly form a headwater improvement of another licensee, a permittee, or of the United States, the Commission determines the equitable part of the annual charges for interest, maintenance, and depreciation to be paid to the owner thereof by the lower power developer benefited.

Reservations of United States Lands for Power Purposes.--Upon application for a license, any lands of the United States included are reserved for power purposes from entry, location, or other disposal, unless the Commission determines that the lands so reserved will not be inured or destroyed for the pruposes of power development by location, entry, or selection under the public land laws.

Investigations of Water Power Resources.--The Commission conducts general investigations of water power resources and their relation to interstate and foreign commerce, and of the water power industry and its relation to other idustries, cooperating with State and national agencies in its investigations and publishing the results of its work in special and annual reports.

Authorizations and Orders Under Part II and II.--In accordance with provisions of parts II and III of the Federal Power Act,


the Commission receives and passes on applications for compulsory interconnections; authorizes and approves the sale, lease, merger, or consolidation of facilities or purchase of securities; and authorizes the issue of securities or assumption of obligation or liability as guarantor, endorser, surety, or otherwise, in respect to any security of another person.

The Commission receives and considers reports of the issue or renewal of, or assumption of liability on, short-tem notes or drafts. It also receives and considers schedules of rztes and charges concerning tranmission or sale of electric energy subject to its jurisdiction and conudcts inquirires into the lawfulness of rates and service, and in connection therewith may suspend the operation of new rate schedules for a limited period of time. Upon complaint, it investigates rates and charges involved in any tranmission or sale lsubject to the jurisdiction of the Commission or service rendered, and may issue orders prescribing the rates, charges, or service.

State Cooperation.--For the purpose of facilitating cooperation with State commissions in accordance with the provisions of the act authorizing the establishment of joint hearings and procedure, and authorizing conferences with State commissions, the Commission has adopted a cooperative procedure of a flexible nature with provision for special procedure in particular cases.

Uniform System of Accounts.--The Commission has prescribed a uniform system of accounts for public utilities subject to its jurisdiction and for its licensees.

Reports to the Commission.--The Commission prescribes, reeives, and compiles periodical and special reports, including financial and statistical data, and data on produciton, tranmission and use of electric energy; fuel consumption and supply; and industrial power requirements for war purposes.

Reports by the Commission.--The Commission publishes annual reports to Congress; annual reports of electric rates throughout the United States, and a National Electric Rte Book; monthly reports of productio of electric energy in the United States, and annual reports of electric power statistics covering production and generating capacity. In addition, special reports on power matters are published from time to time.

Enforcement of Federal Power Act.--Upon complaint or on its own initiative, the Commission conducts investigations with respect to possible vbiolations of the Federal Power Act or of any license, rule, regulation, or order thereunder. It either refers court proceedings under the act to the Attorney General or is represented by its own attorneys.

Recommendations to Congress.--Theh Commission conducts investigations to secure information to serve as a basis for recommending to Congress further legislation concerning the matters to which the Federal Power Act relates.

Regional Districts.--For the purupose of assuring an abundant supply of electric energy throughout the United States with the greatest possible economy and with regard to the proper utilizatioin and conservation of natural resources, the Commission has tentatively divided the country into regional districts for the voluntary interconnection


and coordination of facilities for the generation, transmission, and sale of electric energy, and has so informed all State commissions and other interested parties, whose views and recommendations on the subject are invited.

Regional Offices--Federal Power Commission
Location Address
Atlanta 3, Ga.: Alabama, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina, Tennessee 10 Forsyth Street Building
Chicago 7, Ill.: Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri, North Dakota, South Dakota, Wisconsin U.S. Customhouse, 610 South Canal Street
Forth Worth 2, Tex.: Arkansas, Colorado, Kansas, Louisiana, Nebraska, New Mexico, Oklahoma, Texas, Wyoming Seventh and Lamar Streets
New York 1, N.Y.: Connecticut, Delaware, Maine, Massachusetts, New Hampshire, New Jersey, New York, eastern Pennsyulvania, Rhode Island, Vermont Parcel Post Building, 341 Ninth Avenue
San Francisco 2, Calif.: Arizona, California, Idaho, Montana, Nevada, Oregon, Utah, Washington (Licensed project and accounting work west of the Mississippi River) Phelan Building, Mrket and O'Farrell Streets
Baltimore 2, Md.: District of Columbia, Maryland, Ohio, western Pennsylvania, Virginia, West Virginia (Licensed project and accounting work east of Mississippi Rover; statitical work for entire country) Baltimore Trust Building, 10 Light Street

Natural Gas Act

Exportation or Importation of Natural Gas.--Exportations from the United States to a foreign country or importations from a foreign country to the United States must be authorized by the Commission, when found to be consistent with the public interest.

Control Over Rates and Charges.--Natural gas companies are required to file schedules showing the rates charged for any transportation or sale subject to the jurisdiction of the Commission, and may not change such rates or charges without its approval. The Commission may order changes in rates, but may not order an increase in the rate charged by any natural gas company unless the increase is embodied in a new schedule filed by the company.

Extension of Facilities; Abandonment of Service.--The Commission may order a natural gas company to extend or improve its transportation facilities and to establish physical connection of its transportation facilities with the facilities of, or sell natural gas to, any persons or municipailties engaged, or legally authorized to engage, in the local distribution of natural or artificial gas to the public, if the Commission finds that no undue burden will be placed upon the natural gas compnay. In ordereding such an extension of facilities, the Commission may not impair the ability of the company to render adequate service to its customers. Natural gas companies may not abandon interstate facilities or service without the approval of the Commission.

Certificates of Pub lic Convenience and Necessity.--An amendment to Section 7 of the Natural Gas Act, made February7, 1942,


requires "granfather clause" certificates covering bona fide operation as of the date of the amendment and certificates of public conveninece and necessity for all new construction, operation, extensions, and acquisitions thereafter. The amendment also provided for establishment of service areas.

State Compacts.--The Commission is required to report to Congress information in connection with any compacts proposed by two or more States dealing with the conservation, production, transportation, or distribution of natural gas.

Joint Procedure.--Provision is made for joint hearings and cooperative procedure with State utility commissions concerned in connection with any matter coming before the Commission, and full coopeartion is available in State commissions.

Officials Dealing in Securities.--Personal profit by an official or director of a natural gas company through the negotiation, hypothecation, or sale of any security issued by the company is unlawful.

Uniform System of Accounts.--The Commission has prescribed a uniform system of accounts, effective January 1, 1940, for natural gas companies subject to the provisions of the Natural Gas Act, which covers accounting details of the property of such companies for the production, transportation, or sale of natural gas.

Incidental Powers.--The Commission may require such reports as may be necessary in the administration of the act. In general, it is given administrative powers similar to those provided in the Federal Power Act.

Reclassification of Accounts.--The hCommission is enforcing the uniform system of accounts for natural gas companies by reclassification of account proceedings.

Electric and Natural Gas Rate Regulation.--The Commission in its rate regulation, as in its system of accounts, has taken actual legitimate cost or prudent investment as its basis; and, in the cases of Natural Gas Pipe Line Company of America et al. v. Federal Power Commission (315 U.S. 575) and Federal Power Commission v. Hope Natural Gas Company (320 U.S. 591), it has obtained rulings form the Supreme Court of the United States sustaining rate orders determined on an acutal legitimate cost or prudent investment rate base.

War Activities

In addition to its peactime funcitons, the Commission, under the Federal Power Act, has authority:
  1. To investigate the entire operation of the power industry and, more particularly, the capacity and output of all facilities for the generation, transmission, and distribution of electricity in relation to the national defense (sec. 311).

  2. During the continuance of any war in which the United States is engaged, or whenever the Commission determines that an emergency exists by reason of a sudden increase in the demand for electric energy, or shortage of electric energy or of facilities for the generation of electric energy, or other causes, either upon its own motion or upon complaint, with or wihtout notice, hearings or report, to require by order such temporary connections of facilities and such


    generation, delivery, interchange, or transmission of electric energy as in its judgment will best meet the emergency and servce the public interest (sec. 202c).

  1. During the cointnuance of any emergency requiring immediate action, persons not otherwise subject to the jurisdiction of the Commission may make temporary connections with public utilitites or may construct temporary facilities for the interstate transmission of electric energy as may be necessary or appropriate to meet the emergency, without thereby6 becoming subject to the jurisdiction of the Commission. The Commission is also receiving and grannting requests for approval of permanent interconnections for emergency use under secton 202d.

The act also provides that the United States may take over and oeprate any licensed hydroelectric project upon a writte order of the President stating that the safety of the United States demands it "for the purpose of manufacturing nitrates, explosives or munitions of war, or for any other purpose involving the safety of the United States" (sec. 16).

Under the Natural Gas Act the Commission has power to order natural gas companies to extend their transportation facilities or connect with local distributors of gas upon certain findings that such acton is desirable in the public interest, and that the natural gas company involved is not subject to undue burden or impairment of service (sec. 7a).

Agrrements With War Production Board.--

  1. Power.--In order to cordinate the Commission's war activities with those of the War Production Board, the two agencies agreed on April 24, 1942, to unite their efforts in meeting and handling wartime power problems.

    Under this agreement the War Production Board has responsibility for: (1) the programming of equipment and materials which can be made available for power supply purposes; (2) the determination of power supply and demand in relation to the war production program and essential civilian activities; (3) the planning, development, and administration of power supply allocatoin programs for those regions where the available supply proves insufficient; and (4) the mobilization of power to meet specific war production requirements.

    The Federal Powr Commimssion exercises its full statutory powers under the Federal Power Act and amendments thereto. Through its staff, it collects, compiles, and tabulates information regarding the generation, transmission, distribution, and sale of electric energy, and publishes monthly reports on power system capacities and loads; surveys, in cooperation with other Government agencies, electric and gas utility properties to determine measures to be taken to protect against sabotage and other hostile acts; maintains continuing studies on the need for interconnection and coordination of power facilities, and, where essential to the war effort and materials therefor are available, orders the construction and utilization of such interconnections; makes periodic reports on utility and industrial power facilities; and makes special studies related to the power situation as required or requested by the War Producton Board or other agencies.


  1. Natural Gas.--The War Production Board and the Federal Power Commission, on September 11, 1943, reduced to writing the procedures which had been followed by the two agencies for more than a year in the administration of the wartime natural gas program.

    Under this agreement the War Production Board has responsibility for: (1) the programming of equipment and materials which can be made available for natural gas purposes; (2) the determination of natural gas supply and demand in relation to the military and war production program and essential civilian activities; (3) the mobilization of natural gas supplies and the development and administration of programs for coordinating and expanding natural gas transportation facilities; and (4) planning, development, and administration of natural gas supply allocation programs for those regions where the available supply proves insufficient to meet all requirements.

    The Federal Power Commission exercises its full statutory powers under the Natural Gas Act, as amended, which are: (1-a) to require extension and interconnection of facilities for the interstate transportation and sale of natural gas to distribution companies and distribution centers, (b) to control the abandonment of facilities and service of natural gas companies, (c) to determine whether public convenience and necessity require the construction of new, or extension or acquisition of existing, natural gas interstate transportation facilities and to issue certificates of convenience and necessity therefor; (2) the fixing of rates for the transportation and sale of natural gas in interstate commerce, and the control of the importation and exportation of natural gas; (3) the supervision of accounts and rates of depreciation of natural gas companies subject to the Commission's jurisdiction; (4) the collection, compilation, and tabulation of information regarding receipts, transportation, distribution, and sale of natural gas throughout the United States, and regarding the operation, management, control, service, rates, and contracts of agencies transmitting or supplying natural gas; and (5) surveys and determinations of natural gas supplies and reserves and the determination of the economic feasibility and adequacy of transportation facilities for the delivery and utilization of such natural gas supplies.

    The agreement also provides that the Federal Power Commission will compile such additional studies as the War Production Board may request and that procedures in the collection and compilation of statistical information will be worked out to avoid duplication and impose upon industry the least burden compatible with securing satisfactory results. The Office of War Utilities of the Board will submit its basic general orders in the natural gas field to the Commission for consideration and recommendation.

War Power Contracts.--Under date of September 26, 1942, the president addressed to the Secretary of War, the Secretary of the Navy, and the heads of the United States Maritime Commission, the Defense Plant Corporation, the War Production Board, and the National Housing Agency a letter with respect to arranging for electric power supply for war plants or establishments, and on October 22, 1942, the President also sent to the Chairman of the Federal Power Commission a letter and outline of procedure to effectuate the program. In conformity with the President's directives the Federal


Power Commission serves as the central agency for the determination, in accordance with sound business practice, of problems of procurement officers in contracting for power supply for war industries or establishments, involving Government approval or any Government obligation. For the present, the procedure applies only to arrangements for the procurement of power for war plants and establishments involving deliveries of power of 1,000 kilowatts or more of actual contractual demand. At the request of any Federal agency the procedure will be applied to arrangements involving lesser amounts of power.

The Commission will also provide for review and, if the public interest requires, modification of existing arrangements for the procurement of power in accordance with the procedure contained in the President's directive. Renegotiation.--The Renegotiation Act of 1943, enacted February 18, 1944 (58 Stat. 78), places renegotiation of electric utility contracts with the various Government agencies under the War Contracts Price Adjustment Board, which has assigned the Government electric war contracts to the War Department Power Procurement Officer for renegotiation. Under procedure established, the Power Procurement Officer and the Federal Power Commission cooperate in the renegotiation of Government war power contracts, the staff of the Commission performing the technical analysis of the contract rates incidental to reaching a settlement. The Commission's staff reviews the proposed settlement decided upon by the Power Procurement Officer in the light of its consistency with the principles laid down in the President's directives of September 26, and October 22, 1942.


Basil Manly


Table of Contents

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