The concept of total energy is perhaps best illustrated by the example of a ship at sea which contains its own source for generating power and furnishing heating, cooling and other services. Transfer this example to land at a shopping center or industrial plant where energy is generated on the premises and heating and cooling are furnished as a byproduct, and you have the basic idea of a modern total energy operation.

Today's year-round demand for heating and cooling services and advances in the construction of the machinery used in total energy systems have created a larger potential market for such installations today than existed before.

Nevertheless, developers in Virginia have hesitated to use total energy because of uncertainty concerning its status under our Utility Facilities Act. If the Act is applicable, the total energy developer would need a: certificate from the State Corporation Commission and have to demonstrate that existing utilities cannot supply the need for electricity in his development. If the Act does not apply, the developer could go ahead without advance approval. As it stands now, the Act is ambiguous and the State Corporation Commission has offered no interpretation of the Act on this point.

The question whether or not to amend the Utility Facilities Act was clearly posed for the first time in the 1968 General Assembly by Senate Bill No. 82 which added language to the Act designed to exempt from the Act companies operating utility facilities on the premises and furnishing utilities to tenants on the premises. The Bill failed to pass, but led to Senate Joint Resolution No. 58, the directive for this study.

Pursuant to this directive, the Council appointed a Committee to conduct an initial study and report to it. Council member and Senator, Edward E. Willey of Richmond, was appointed Chairman. Appointed to serve with him were: Delegate George B. Anderson, Danville; Joseph E. Blackburn, Counsel, Chesapeake and Potomac Telephone Coμipany, Richmond; Rodham Delk, Attorney, Smithfield; Overton D. Dennis, Jr., Dominion Oil Company, Inc., Richmond; Senator Robert C. Fitzgerald, Fairfax; Charles M. Hailey, Falls Church; William Martin Johnson, Wiley and Wilson, Consulting Engineers, Lynchburg; H. E. Lordley, Director, Public Utilities, Richmond; Roland C. Luther, United Pocahontas Coal Company, Bluefield; Delegate Theodore V. Morrison, Jr., Newport News; R. G. Roop, Petroleum Marketers, Inc., Richmond; Earl J. Shiflet, Executive Manager, Virginia Association of Electric Cooperatives, Richmond; Chester Starkey, Commonwealth Natural Gas Corporation, Richmond; and W. S. White; Appalachian Power Company, Roanoke. Mr. Anderson was elected Vice-Chairman by the Committee, and the Division of Statutory Research and Drafting, represented by Mary Spain, served as counsel to it.

The Committee held several executive meetings, toured the total energy facility at Turfland Mall in Lexington, Kentucky, conducted a well-attended and informative public hearing in January, consulted frequently with representatives of the State Corporation Commission and surveyed other states to ascertain their statutory and regulatory treatment of total energy systems.

The Committee submitted its report to the Council and we have reviewed and studied it with care. We now submit the following recommendations and report.