National Grid USA
25 Research Drive
Westborough, MA 01582

April 23, 2001

Jonathn G. Katz, Secretary
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549-0609

Re: File No. S7-07-01 Comments

Dear Sir:

National Grid appreciates this opportunity to submit comments on proposed changes to 17 CFR 257.1 with respect to recordkeeping. National Grid Group plc is a foreign holding company registered under the Public Utility Holding Company Act of 1935, as amended (the Act) and is the indirect parent of National Grid USA, also a registered holding company under the Act. National Grid currently operates under a comprehensive Commission order dated March 15, 2000.

National Grid supports the effort to expand the approved recordkeeping methods to allow the use of modern information technology. This is particularly important for a foreign holding company system such as National Grid that may have many different forms of recordkeeping throughout its United States and foreign holdings. Unfortunately, paper records continue to play a significant role in recordkeeping. Many paper records are maintained in off-site storage locations. For example, National Grid USA uses Iron Mountain as a third party vendor to store some of its paper records. Storage providers offer secure and protected storage which would be difficult for us to duplicate. The cost of converting paper records to electronic media remains expensive.

In a conversation that Ms. Sandra Brochu, Senior Paralegal on our staff, had with Ms. Victoria Adraktas, Attorney-Advisor from the Office of Public Utility Regulation, Ms. Brochu confirmed that the new language in Section 257.1(e)(2)(ii) requiring "in no case more than one business day after the request" turnaround time would apply to paper records as well as electronic records. We have serious concerns about this strict "one business day" requirement.

First, some of our paper records are held by Iron Mountain and our contract with Iron Mountain has a best efforts commitment to get the paper record to us out of storage in one day. There is no guarantee that Iron Mountain will be able to meet this commitment and even if it were to get us the document, there would not be any time to provide it to the Commission. We believe that it would be very expensive to contract with a third party record storage firm on a guaranteed turnaround time basis, particularly for such a short turnaround time with no margin for error. Second, as a foreign holding company system, the one day turnaround requirement is impracticable. National Grid has holdings in many countries throughout the world, and it would take additional time to pull in requested paper documents. Because the amount of additional time is difficult to predict, we urge that a more flexible approach be adopted, such as a commitment to be "prompt" or a "best effords" commitment to provide as many requested documents as practicable within one business day.

Finally, the one day requirement even for electronic records seems aggressive to us. There have been times when our computer systems have been "down", and it would not have been possible to respond. Examples that may cause delays in providing electronic records include equipment malfunction and virus attacks. Again, we urge that a more flexible approach be adopted. If you have any questions, please do not hesitate to call me at 508-389-2972. Thank you for this opportunity to comment.

Very truly yours,

Kirk L. Ramsauer, Deputy General Counsel
National Grid USA