William O. Douglas

“ If the SEC is prepared to show that freeing a gas system from control by an electric system will improve earnings by some amount, then this may be a legitimate offset to the losses that can be shown, and there is leeway for rough calculations and for estimates based on studying past separations. See Ritchie, Integration of Public Utility Holding Companies 143-147 (1954) . But to dispense with proof and disregard the basic test of 'substantial economies' is to undo Congress' own careful compromise of the various conflicting policy interests. ”

“ An 'integrated public-utility system' as applied to gas utility companies is defined by § 2 (a) (29) (B) as 'a system consisting of one or more gas utility companies which are so located and related that substantial economies may be effectuated by being operated as a single coordinated system confined in its operations to a single area or region, in one or more States, not so large as to impair (considering the state of the art and the area or region affected) the advantages of localized management, efficient operation, and the effectiveness of regulation.'↑ 49 Stat. ”

“ The SEC has wide latitude in deciding how to gauge and compute 'substantial economies' and it has used that freedom in the past. [27] What the Commission has no right to do, however, is to substitute to the detriment of business interests and the public alike a quite different standard for the one enacted by Congress. Neither does this Court have that right. I would affirm the Court of Appeals' well considered decision. ”

“ If the natural reading produced some strange or arbitrary result there might be reason to hesitate; but in this case the literal reading makes excellent sense in serving the very rational and desirable end of financial economy. ”

“ Far more weight is given by the Court's opinion to the Act's supposed hostility toward common control of gas and electric utility systems with its danger of stifled competition. First of all, this hostility appears to be an illusion. The House and Senate Committees in identical language expressly stated that common ownership of competing forms of energy was 'a field which is essentially a question of State policy' ”

“ Rejecting the assertion that any saving beyond a wholly nominal one would do, the SEC stated: 'The normal and usual meaning of the word 'substantial' is a meaning connoting 'important.' And we think that this normal and usual meaning is compelled here.' Id., at 209. At least four subsequent decisions cite North American and adopts its 'importance' test, a natural reading of the Act rather the unusual and specialized one adopted today. ”

“ The remaining citation to the Senate Hearings does indeed reveal one Senator's general concern with common ownership's impact on competition; the respondent states it is 'the only such reference in the entire Senate hearing.' Brief, p. 37, n. 45.↑ It should again be remembered also that the present provision is not the only legislative safeguard. ”

“ While the Commission has variously phrased the rule, it has consistently adhered to that view. [12]
This suggests a much more stringent test than 'a business judgment of what would be a significant loss,' to quote the Court of Appeals. 346 F.2d, at 406. Promotion of 'economy of management and operation' and 'the integration and coordination of related operating properties' (§ 1 (b) (4) , 49 Stat. 804, 15 U.S.C. § 79a (b) (4) (italics supplied) ) is a theme that runs throughout the Act. ”