to the utility grid has been determined to be the most important factor determining cash flow and the rate of return. The cost of electricity would primarily determine the extent of private participation in SPS financing. However, the large capital requirements for SPS through R&D and initial operation tend to favor some form of public sector financing. The federal government, or a consortium of governments, may in fact be the only viable source of financing during start-up operations. The private sector, nevertheless, would participate from the beginning in a supplier/contractor role. Financial and management requirements for the SPS will differ markedly for each of its stages of growth and according to the degree of international involvement. A joint venture partnership between government and the private sector is possible if it is compatible with the interests of international parties. Alternatively, private sector finance mechanisms, compatible with international private sector involvement, provide other potential finance models. The Communications Satellite Corporation (COMSAT) has been identified as a likely model for a national endeavor, while the International Telecommunications Satellite Organization (INTELSAT), the International Maritime Satellite Organization (INMARSAT) and the International Energy Agency (IEA), have been identified as operating models for an international SPS. 2. Regulatory Issues Regulation covers a broad spectrum of concerns. Two were selected for emphasis in CDEP. In the first, state and local regulations applicable to the construction and operation of power plants were analyzed to see how they might apply to SPS rectennas. In the second, the historical background and likely future of the regulation of microwave radiation was established. 2 n a. State and Local Regulation Regulation of power plant siting, construction and operation falls primarily under the jurisdiction of state and local government entities. Currently, state and local regulation is in a state of flux and inadequate to deal with the SPS. The state Public Utility Commissions' approval of utilities' precommitment to the SPS may be conditional on government guarantees regarding electric power pricing. States want and are asserting increasing control over powerplant planning.