Aside from storage, it is possible to accomplish something by "pondage," that is, the accumulation of water from day to day in power-dam ponds during that portion of the day when the demand is smallest.

A more effective remedy is in "coupling up," into one unit, two or more sites accessible to the same markets. In practically all cases some of the developments can cease operations when the highest demand is over and accumulate pondage to be brought into use at the period of highest demand the next day. In the meantime the other sites can meet the diminished demand.

The variableness of power supply demand, however, cannot be entirely cured, even by storage, pondage, and "coupling." The effective remedy is the use of auxiliary steam plants. In nearly all cases hydraulic concerns must provide sufficient steam auxiliaries to meet variations not otherwise met.

Advantages of unification of developments. On the other hand, if a power site or a group of power sites provides more power than a single market can consume, all the power can be utilized by "coupling up" two or more markets.

The economic advantages gained by "coupling up" of sites or markets, or both, by means of transmission lines, obviously are great. It is apparent that the most efficient use of water-power from an economic point of view is facilitated by thus gathering into a single unit all the power available for a given market or a group of markets, using the same system of transmission lines. The independent operation of two sites may involve a great waste of energy and capital. In fact, in the case of a comparatively small water-power at a long distance from a market it might be virtually impossible to develop it except in connection with some other site. In the same way, in the case of storage, there is an advantage in large-scale operations. This is because water gathered in storage reservoirs contributes to every power site below, thus making it advantageous to control all the sites dependent upon a storage project.

Concentration of ownership and control. From the above facts it is clearly seen that in many instances local concentration carries with it great economic advantages. . . .

As this report clearly shows, there is a general and marked tendency toward concentration in the control of water power. Such concentration takes two forms. One is the single ownership of practically all the power in a given locality and the other is the ownership of water-power in scattered localities by a single interest. The two are often found together.

Certain forces in the water-power industry tend peculiarly toward concentration. The unification of developments and of storage, and of markets as well, incident to the highest efficiency in the utilization of water-power, as just described, clearly tend toward concentration of control. Concerns undertaking the development of water-power tend to acquire all available power in a given community because of the advantages of unified operation above outlined.

Another circumstance leading toward concentration of control is the fact that the practical limit of electric transmission of water-power is only about 200 miles. This, it will be seen, makes it virtually impossible for a water-power concern in one part of the country to compete with another water-power concern in a distant part of the country. Aside from this limitation on transmission of power, moreover, is the fact that, as a rule, the total demand for power within an area of practicable transmission is almost invariably greater than the supply of water-power alone. The Bureau's investigation shows that in no considerable area is the supply of power now generated from water sufficient to meet the total power demand. Owing to the large investment required to develop a water-power, and to this general limitation upon the supply, the most economical utilization of such power frequently results in concentrating all the power developed within a given area under a single control.

A peculiar circumstance which tends to accelerate concentration of water-power ownership is found in the commercial customs prevailing among manufacturers of machinery and supplies for the generation of electricity. Such manufacturers, in order to expand their business, often accept the securities of hydroelectric companies in payment, at least in part, for machinery and supplies. They have thus been led to enter actively into the hydroelectric field. Since the manufacture of such machinery and supplies is largely concentrated in a few hands, this obviously tends toward a corresponding concentration of water-power ownership.

Again, a number of financial houses making a specialty of financing water-power developments have become interested in water-powers, and this has created another class of controlling interests. Furthermore, many officers and directors of equipment concerns and of engineering and financial houses have become individually interested in the same water-power developments, thus bringing about a close relationship between the two interests.

Still again, as shown later, there is an increasing interrelationship between water-power enterprises and public-service interests.

The concentration of ownership of developed water-power has steadily grown until in any given community it is usually all under a single control, or substantially so. Absolute ownership of all the power in a locality by a single interest, however, is not necessary to establish control. If one concern owns the most advantageous sites, and has a strong foothold in the markets, it has a dominating position in that area.

Such concentration of ownership has been most marked in the development of water-power for commercial use. There are, however, a few instances of marked concentration of the ownership of water-power used in manufacturing. The most noteworthy instance of this is found in the International Paper Co. . . .

Summary of ownership and control by interests [page 27]. The General Electric interests control the water-power situation in large portions of Washington, Oregon, Colorado, Montana, and elsewhere. The Stone and Webster interests exercise control (based largely, however, on management rather than ownership) in localities in Washington, Iowa, and Georgia. The Pacific Gas and Electric Co. practically dominates the power situation in a large number of localities in the northern half of California. The Southern Power Co. controls the power situation in South Carolina and has a strong foothold in North Carolina. The S. Morgan Smith interests dominate the power situation in the vicinity of Atlanta, Ga. The Telluride Power Co. controls absolutely a large territory in Utah and Idaho. The Commonwealth Power, Railway and Light Co., which is a part of the Clark-Foote-Hodenpyl-Walbridge interests, dominates the power situation in the Lower Peninsula of Michigan. The Gould interests control the best of the available water-power sites in the vicinity of Richmond, Va.