Filings Under the Public Utility Holding Company Act of 1935, as Amended (``Act'')

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 35-26470]

Filings Under the Public Utility Holding Company Act of 1935, as

Amended (``Act'')

February 9, 1996.

Notice is hereby given that the following filing(s) has/have been

made with the Commission pursuant to provisions of the Act and rules

promulgated thereunder. All interested persons are referred to the

application(s) and/or declaration(s) for complete statements of the

proposed transaction(s) summarized below. The application(s) and/or

declaration(s) and any amendments thereto is/are available for public

inspection through the Commission's Office of Public Reference.

Interested persons wishing to comment or request a hearing on the

application(s) and/or declaration(s) should submit their views in

writing by March 4, 1996, to the Secretary, Securities and Exchange

Commission, Washington, DC 20549, and serve a copy on the relevant

applicant(s) and/or declarant(s) at the address(es) specified below.

Proof of service (by affidavit or, in case of an attorney at law, by

certificate) should be filed with the request. Any request for hearing

shall identify specifically the issues of fact or law that are

disputed. A person who so requests will be notified of any hearing, if

ordered, and will receive a copy of any notice or order issued in the

matter. After said date, the application(s) and/or declaration(s), as

filed or as amended, may be granted and/or permitted to become

effective.

Allegheny Power System, Inc., et al. (70-8411)

Allegheny Power System, Inc. (``APS''), 12 East 49th Street, New

York, New York, 10017, a registered holding company; AYP Capital, Inc.

(``AYP''), 12 East 49th Street, New York, New York, 10017, a non-

utility subsidiary company of APS; and Allegheny Power Service

Corporation (``APSC''), 800 Cabin Hill Drive, Greensburg, Pennsylvania,

15601, a non-utility subsidiary company of APS, have filed a post-

effective amendment to an application-declaration previously filed

under sections 6(a), 7, 9(a), 10, 12(b), 13(b), 32 and 33 of the Act

and rules 45, 50, 53, 87, 90 and 91 thereunder.

By order dated July 14, 1994 (HCAR No. 26085), APS was authorized

to organize and finance AYP to: (i) explore investment opportunities in

companies engaged in new technologies related to the core utility

business of APS and (ii) invest in companies for the acquisition and

ownership of exempt wholesale generators (``EWGs'').

By order dated February 3, 1995 (HCAR No. 26229), AYP was

authorized to engage in the development, acquisition, construction,

ownership and operation of EWGs and in development activities with

respect to (i) qualifying cogeneration facilities and small power

production facilities (``SPPs''); (ii) nonqualifying cogeneration

facilities, nonqualifying SPPs and independent power production

facilities (``IPPs'') located within the service territories of APS

public utility subsidiary companies; (iii) EWGs; (iv) companies

involved in new technologies related to the core business of APS; and

(v) foreign utility companies (``FUCOs''). AYP Capital was also

authorized to consult for nonaffiliate companies. APS was authorized to

increase its investment in AYP Capital from $500,000 to $3 million.

By order dated October 27, 1995 (HCAR No. 26401), APS and AYP were

authorized to form and finance special-purpose subsidiary companies

(``NEWCOs'') to acquire interests in EWGs and FUCOs, to provide energy

management services and demand side management services, to factor

accounts receivable, and to manage the real estate portfolio of the APS

system. APS also was authorized to invest in AYP, and AYP was

authorized to invest in NEWCOs, up to $100 million through December 31,

1999. AYP and the NEWCOs were authorized to obtain loans or to issue

recourse obligations guaranteed by AYP or APS subject to the $100

million limit. Finally, the NEWCOs were authorized to issue partnership

interests or trust certificates through December 31, 1999 to third

parties to finance EWGs and FUCOs in an amount not to exceed $200

million.

This post effective amendment seeks Commission authorization for

APS and AYP to increase the limit on loans and guarantees from $100

million to $300 million. This increase is requested in part because AYP

has agreed to purchase the 50% interest of Duquesne Light Company in

Fort Martin Generating Station Unit No. 1 (``Fort Martin'') for $181

million.

Fort Martin is operated by Monongahela Power Company

(``Monongahela''), an associate company of AYP and a wholly-owned

public utility subsidiary of APS, pursuant to an Operating Agreement

dated April 30, 1965. Monongahela was chosen to operate Fort Martin by

an operating committee that consists of the three owners of Unit No.

1--Duquesne Light Company, Monongahela, and Potomac Edison Company.

Certain common facilities are operated under a Common Facilities

Operating Agreement dated November 14, 1968. The Operating Agreement

has been approved by the FERC and by all state commissions with

jurisdiction over the parties. The Operating Agreement, which details

the allocation of costs for the operation and maintenance of Fort

Martin, will remain in effect after the sale of the 50% interest.

Consolidated Natural Gas Company (70-8759)

Consolidated Natural Gas Company (``CNG''), CNG Tower, 625 Liberty

Avenue, Pittsburgh, Pennsylvania 15222-3199, a registered holding

company has filed an application-declaration under sections 3(b), 6(a),

7, 9(a), 10, 12(b), 13(b), 32 and 33 of the Act and rules 45, 53, 54,

83, 87, 90 and 91 thereunder.

CNG proposes to form CNG International Corporation (``CNGI'') as a

subsidiary which would exclusively invest either directly or, through

intermediate subsidiaries (``Intermediate Subsidiaries''), indirectly

in energy-related businesses outside the United States. CNG requests

authority through March 31, 2001 to invest up to $300 million in any

combination of debt and equity funds through CNGI in such businesses

(``Investment Cap'').

CNG additionally requests authority for CNGI to directly or,

through one or more Intermediate Subsidiaries, indirectly acquire

securities or interests in the business of one or more ``exempt

wholesale generators'' (``EWGs'') located outside of the United States

and ``foreign utility companies'' (``FUCOs''). Any direct or indirect

investment by CNGI in an EWG or a FUCO would not be subject to the

Investment Cap, but would not be undertaken if, as a consequence, the

aggregate direct and indirect investment by CNG in all EWG's and FUCO's

exceeded 50% of CNG's consolidated retained earnings.

The types of energy-related businesses interests, other than EWGs

and FUCOs, in which CNG requests authority for CNGI to acquire include:

(a) The sale and servicing of energy equipment; (b) gas transmission

and storage; (c) gas exploration, production, brokering and marketing;

(d) brokering and marketing of electricity, gas and other energy

commodities and (e) services related to the foregoing.

CNG also requests authority for CNGI and its affiliates to provide

(a) energy consulting in foreign energy markets and (b) administrative,

technical,

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operating, maintenance, and other management services to non-associates

with respect to their foreign operations. All such services, together

with the energy-related businesses described above are referred to as

``Foreign Energy Activities.'' All such services would be provided to

nonassociates at market-based rates.

CNGI and its affiliates may also provide similar goods and services

to wholly-owned subsidiaries and to entities jointly owned by CNGI and

its subsidiaries. Services provided to CNGI affiliates would be at

market rates if such affiliate either (a) derives no material part of

its income, directly or indirectly, from sources within the United

States and is not a public-utility company operating within the United

States or (b) does not provide services or sell goods directly or

indirectly to CNG domestic utility affiliates.

CNGI and its affiliates may contract with CNG associates in order

to provide the above services. Services obtained from utility

associates would be performed at cost. Services from nonutility

associates may be performed at market; provided, however, that services

from nonutility associates substantially involved in the provision of

services to CNG utility associates would be performed at cost.

CNGI may invest in Foreign Energy Activities through the

acquisition of up to 100% of the voting or non-voting stock of

corporations engaged exclusively in such activities. Alternatively,

CNGI may invest and participate through wholly-owned limited purposes

subsidiary corporations with nonassociates in partnerships or joint

ventures exclusively engaged in Foreign Energy Activities.

CNG would provide funds to CNGI for the proposed activities by

purchasing from CNGI up to 30,000 shares of its common stock, $10,000

par value. Although CNGI would issue no more than 30,000 shares, it

proposes to authorize 50,000 shares of common stock, $10,000 par value.

CNG would additionally fund CNGI's activities through open account

advances and/or long-term loans. In addition, CNG proposes that CNG,

CNGI and Intermediate Subsidiaries be authorized to enter guarantee

arrangements, obtain letters of credit and otherwise provide credit

support with respect to the obligations of their respective

subsidiaries. The maximum aggregate limit on all such credit support

would be $300 million.

CNG anticipates that most securities issued among CNGI and its

affiliates, and most securities issued by CNGI and its affiliates to

third parties, will be exempt from the requirements of section 6(a) and

7 of the Act. However, CNG requests authority for CNGI and its

associates to issue securities in a transaction which would not qualify

for exemption under rules of the Act at the time such securities would

be issued.

Such securities would encompass interests in partnerships, joint

ventures or other entities, and all other types of equity interests,

regardless of preference with respect to, or condition on,

distributions from the issuer of such securities, upon liquidation or

otherwise.

CNG states that it would obtain the funds for any investment in

CNGI from internally generated funds or as the Commission may otherwise

authorize by separate order.

The Columbia Gas System, Inc. (70-8775)

The Columbia Gas System, Inc. (``Columbia''), 20 Montchanin Road,

Wilmington, Delaware 19807, a registered holding company, has filed an

application-declaration under section 6(a), 7, 9(a), 10, 12(b) and

13(b) of the Act and rules 43, 45, 87, 90, and 91 thereunder.

Columbia proposes to form one or more direct or indirect

subsidiaries (``Consumer Service Company'') to engage in the business

of providing energy-related consumer services (``Consumer Services'').

To the extent these services are provided by a new subsidiary, Columbia

seeks authorization, through December 31, 1997, to fund the new venture

through the purchase of up to $5 million dollars of shares of common

stock of Consumer Services Company, $25 par value per share, at a

purchase price at or above par value. The acquisition may be made by

either Columbia (in the case of a direct subsidiary) or by one of

Columbia's subsidiary companies (in the case of an indirect

subsidiary). To the extent that the services are provided by an

indirect subsidiary, the funding by the direct subsidiary will come

either from previously authorized funding or from cash on hand.

Columbia expects that its Consumer Services subsidiaries will

conduct their businesses both within and outside of the states of

Kentucky, Maryland, Ohio, Pennsylvania, and Virginia. Columbia states

that the Consumer Services will primarily benefit Columbia's customers

and Columbia's local distributing companies (``LDCs'') (Columbia Gas of

Kentucky, Inc., Columbia Gas of Maryland, Inc., Columbia Gas of Ohio,

Inc., Columbia Gas of Pennsylvania, Inc. and Commonwealth Gas Services,

Inc.). The Consumer Services offered would include the following: (1)

Safety inspections (energy assessments and energy-related safety

inspections such as carbon monoxide and radon testing, appliance

efficiency ratings and wiring safety checks); (2) appliance financing

(loans supporting the purchase of energy-related appliances); (3)

billing insurance (to ensure payment of consumer utility bills in the

event of death, disability or involuntary unemployment); (4) appliance

repair warranty (repair service for heating and air conditioning and

major appliances); (5) gas line repair warranty (warranty against the

cost of repair of faulty gas service lines); (6) merchandising of

energy-related goods (direct sales of energy-related devices); (7)

commercial equipment service (warranty service for operators of

commercial equipment); (8) bill risk management products (price

protection services for gas consumers); (9) consulting and fuel

management services (advisory and/or management services regarding

energy consumption and measurement for commercial and industrial

customers); (10) electronic measurement services (enhanced measurement

and billing services for commercial and industrial customers to enable

them to better monitor their energy consumption and expenditures); (11)

incidental services (needed as a result of the services set forth

above).

Columbia also proposes that its LDCs provide Consumer Services

Company with billing, accounting, and other energy-related services.

Columbia states that all services required to conduct the Consumer

Services Company's business that are provided by the LDCs or any other

Columbia company will be billed in accordance with section 13(b) of the

Act and rules 87, 90 and 91 thereunder.

For the Commission, by the Division of Investment Management,

pursuant to delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 96-3417 Filed 2-14-96; 8:45 am]

BILLING CODE 8010-01-M