ALLEGHENY POWER SYSTEM INC
POS AMC, 1996-07-23
ELECTRIC SERVICES
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                                                 File No. 70-8411


               SECURITIES AND EXCHANGE COMMISSION

                      Washington, DC  20549


                 POST-EFFECTIVE AMENDMENT NO. 14

                               TO

                   APPLICATION OR DECLARATION

                               ON

                            FORM U-1

                              UNDER

         THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935

               ALLEGHENY POWER SERVICE CORPORATION
                      800 CABIN HILL DRIVE
                      GREENSBURG, PA  15601

                  ALLEGHENY POWER SYSTEM, INC.
                      10435 DOWNSVILLE PIKE
                      HAGERSTOWN, MD 21740

                        AYP CAPITAL, INC.
                      10435 DOWNSVILLE PIKE
                      HAGERSTOWN, MD 21740
                                

(Name of company or companies filing this statement and addresses of principal
executive offices)


                  Allegheny Power System, Inc.


(Name of top registered holding company parent of each applicant or declarant)

                    Thomas K. Henderson, Esq.
                    Allegheny Power Service Corporation
                    10435 Downsville Pike
                    Hagerstown, MD 21740


             (Name and address of agent for service)




          1.   Applicants hereby amend Item 6. Exhibits and Financial
Statements by filing the following:

               D-8(a)         Order of the Federal Energy Regulatory
                              Commission Approving Exempt Wholesale
                              Generator Status.


                            SIGNATURE

          Pursuant to the requirements of the Public Utility Holding Company
Act of 1935, the undersigned company has duly caused this statement to be 
signed on its behalf by the undersigned thereunto duly authorized.

                              ALLEGHENY POWER SYSTEM, INC.

                              By:  CAROL G. RUSS                 
                                   Carol G. Russ
                                      Counsel

                              AYP CAPITAL, INC.

                              By:  CAROL G. RUSS                 
                                   Carol G. Russ
                                      Counsel
                    
                              ALLEGHENY POWER SERVICE CORPORATION

                              By:  CAROL G. RUSS                 
                                   Carol G. Russ
                                      Counsel


Dated: July 23, 1996
U:\DUMP\AYP\POSTEF14

                     FEDERAL ENERGY REGULATORY COMMISSION       Exhibit D-8(a)
                             WASHINGTON, DC 20426


OFFICE OF THE GENERAL COUNSEL             July 19, 1996











Theresa J. Colecchia, Esq.
800 Cabin Hill Drive
Greensburg, PA 15601

                                          RE:  Docket EG96-76-000

Dear Ms. Colecchia:

            On June 7, 1996, you filed an application for determination of
exempt wholesale generator status on behalf of AYP Energy, Inc. pursuant to
section 32 of the Public Utility Holding Company Act of 1935 (PUHCA).  Notice
of the application was published in the Federal Register, 61 Fed. Reg. 32,792
(1996), with interventions or comments due on or before July 8, 1996.  None
was filed.

            Authority to act on this matter is delegated to the General
Counsel.  18 C.F.R. 375.309(g).  Based on the information set forth in the
application, I find that AYP Energy, Inc. is an exempt wholesale generator as
defined in section 32 of PUHCA.

            A copy of this letter will be sent to the Securities and Exchange
Commission.

                                          Sincerely,

                                          SUSAN TOMASKY
                                          Susan Tomasky
                                          General Counsel


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