FERC testifies to House subcommittee

A panel of federal energy regulators testified yesterday before the House Committee on Energy and Commerce, Subcommittee on Energy. In written testimony and oral remarks, Federal Energy Regulatory Commission Chairman Neil Chatterjee and Commissioners Cheryl A. LaFleur, Richard Glick, and Bernard L. McNamee addressed the Commission's work and priorities.

Chairman Chatterjee's testimony focused on three issues: integrating storage resources into wholesale electric markets, protecting the bulk power system against cyber and physical threats, and reforming the Commission's regulations under the Public Utility Regulatory Policies Act of 1978 (PURPA).

On storage, Chairman Chatterjee expressed pride for the Commission's work to remove barriers to storage resources' participation in wholesale electric markets, including the Commission's Order No. 841 governing the capacity, energy, and ancillary services markets operated by regional transmission organizations (RTOs) and independent system operators (ISOs). He projected "an increase in the deployment of storage resources,which should result in greater reliability and lower prices for customers by enhancing competition."

On security, Chairman Chatterjee described America's critical infrastructure as "increasingly under attack by foreign adversaries." He noted that the Commission has approved reliability standards proposed by the North American Electric Reliability Corporation (NERC), which are now mandatory for covered entities, as well as voluntary efforts like outreach and interdepartmental coordination.

On PURPA, the Chair noted that the Commission's PURPA regulations were primarily adopted in the 1980s, but "the energy landscape that existed when PURPA was conceived more than four decades ago was fundamentally different from that of today." In light of changes including increased deployment of solar and wind power, open access to competitive markets, abundant natural gas, state renewable portfolio standards, and federal tax credits for renewable energy, the Chair said that the Commission has undertaken a review of its PURPA regulations, and that the Commission will "determine the best path forward on this issue."

Additional testimony by Commissioner LaFleur addressed "three major issues that are shaping the Commission’s work: (1) how individual states and regional electric markets select resources; (2) how those resources are compensated; and (3) how the Commission considers infrastructure decisions, particularly with respect to linear infrastructure like transmission lines and natural gas pipelines."

Commissioner Glick's testimony focused on the American electricity sector's "dramatic transformation to a less carbon-intensive, more distributed electric generation fleet that is increasingly customer-centric." He presented benefits of this transition, including reduced costs to consumers, and reduced greenhouse gas emissions and contributions to climate change. Noting that the Commission is not a "climate regulator," Commissioner Glick argued that "the potential climate consequences of the Commission's actions make it all the more important that the Commission faithfully execute its statutory mandates." He described the Commission's efforts to remove barriers to competition so that "new technologies and products can compete on a level playing field," while respecting "Congress’s decision to leave the states in charge of regulating the generation mix."

Commissioner McNamee's testimony addressed the Commission's roles in reviewing and approving applications to export liquefied natural gas (LNG) and for the construction and operation of interstate natural gas pipelines, in regulating interstate oil pipelines, and electricity markets.