Power Pool

A drought last week had Federal Power Commission Chairman Leland Olds more worried than any farmer. In the Southeast, electricity depends on water power, and many a rapidly expanding defense industry (aluminum, ferroalloys, etc.) depends on electricity. But the year's rainfall in the Southeast was 50% below normal. The water level in some of TVA's reservoirs was down 60%. Olds made a quick estimate: the drought meant a 1,000,000-kilowatt power shortage in the Southeast before year's end.

So smart Chairman Olds called in TVA officials, officers of the Southeast's private power companies. By week's end he was able to announce a giant, 17-State power pool which represented the largest U.S. attempt to date to coordinate power facilities. From Illinois to Texas and from Florida to Pennsylvania, every generating station owned by TVA and 17 private companies will be thrown into maximum possible use, with interconnected transmission lines balancing the load.

The Southeast's railroads, at suggestion of Elder Statesman Bernard Mannes Baruch, will even lend TVA Diesel locomotives if they prove a useful substitute for water power. Olds's estimate of how much of the shortage this scheme will meet: more than 500,000 kilowatts.

Unlike his namesake in the steel industry (see p. 69), Powerman Olds has been predicting a shortage all along. Last December FPC forecast that the U.S. defense program would run into a 1,500,000-kilowatt power shortage in 1942. Even after substantial capacity expansions had been planned, its March estimate was an 800,000-kilowatt shortage next year. Now even more power-consuming aluminum plants are planned for defense (see p. 20). Droughts or no droughts, it looked last week as if the next big defense bottleneck might be power.

The largest single non-Government borrowing ever attempted was announced last week: to finance a huge $400,000,000 expansion program (including new transcontinental cables buried three feet underground), American Telephone & Telegraph Co. said it would offer its 630,902 stockholders $234,000,000 in convertible debentures.

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