Somewhat like the first month of 2017 ended, with concerns about natural gas pipeline infrastructure and questions about who will be chairman at FERC, the last month of the year brings infrastructure concerns and questions not about who will lead the Commission but when.
Another Trump appointee, Democrat Richard Glick, was sworn in on November 29. Glick was confirmed by the Senate on November 2 at the same time as McIntyre. Glick arrives as a commissioner after two stints as a Senate staffer, the most recent being his role as general counsel for Democrats on the Senate Energy and Natural Resources Committee. Attorney Kevin McIntyre was confirmed by the Senate in early November and had his paperwork signed by President Donald Trump just before Thanksgiving. But as of press time December 1, McIntyre, a Republican who has been tapped by Trump to become chairman, had not been sworn in at the Commission.
The FERC press office had no information on the timing of when McIntyre would join the Commission, and industry sources differed in their views. A few sources who asked not to be named expected McIntyre to be sworn in December 1 and assume the chairman position. Others have speculated that Neil Chatterjee may stay chairman past the first week of December to address senior staffing issues or the notice of proposed rulemaking (NOPR) to provide more financial compensation for coal and nuclear generation units in organized wholesale power markets.
FERC is facing a December 11 deadline to respond to the NOPR (RM18-1) from Energy Secretary Rick Perry, and industry sources have noted that on December 8, Chatterjee will have been chairman for 120 days, with the ability to appoint Trump administration ideologues to staff positions at the Commission. That notion has been discounted by Republican sources, but several others maintain that in a year with plenty of political turmoil and an unprecedented stretch when FERC was without a quorum, bizarre events are deemed more feasible than in the past.
Even the idea that McIntyre could be sworn in but not named chairman has been floated, though that would take some type of action by the White House. In the July 13 announcement on McIntyre’s nomination, the White House said that he “upon confirmation, shall be designated chairman.” With no public indication that there has been a change in position, most sources reached for this story believe McIntyre will be chairman once he is sworn in.
In several of the orders approved by FERC since November 29, Glick was listed as not participating. Besides his most recent role in the Senate, he held positions in the energy sector as director of government affairs for PPM Energy and PacifiCorp, at the Department of Energy (DOE) as senior policy advisor to former Energy Secretary Bill Richardson, and as an attorney with law firm Verner, Liipfert, Bernhard, McPherson and Hand. In between the law firm and DOE role, he was legislative director and chief counsel to former Senator Dale Bumpers (D-Ark.), who served on the Senate energy committee.
In a November 30 speech at the Natural Gas Roundtable, Chatterjee did not address the NOPR and said he did not know when McIntyre would join the Commission. He commented that he has known Glick for years and worked with him in the Senate, and anticipates working well with him at FERC.
“We are all eager to welcome Kevin McIntyre” as well, and “I look forward to working with him as he steps into the chairman’s shoes in the coming days,” Chatterjee said.
McIntyre is an attorney and co-leader of the global energy practice at Jones Day, and he has practiced law for nearly 30 years, with plenty of clients in different sectors of the energy industry. If he takes a seat as chairman, 2017 will have seen four different chairmen at FERC, which likely has not happened before. Former chairman Norman Bay resigned in early February when Trump named Cheryl LaFleur chairman, and Chatterjee was named chairman once he and commissioner Robert Powelson were confirmed by the Senate in early August.
At the end of January and early February, when Bay was on his way out, FERC approved a raft of major natural gas pipeline projects, including new facilities by Rover Pipeline LLC, Transcontinental Gas Pipe Line Corp., Dominion Carolina Gas Transmission LLC, Tennessee Gas Pipeline Co. LLC, and Northern Natural Gas Co.
FERC’s review of pipeline applications has been mentioned by Chatterjee as a priority in the past, and he elaborated on some of those themes in his speech at the Natural Gas Roundtable. He highlighted working through the backlog of cases stemming from the six months without a quorum, including authorization of about 8 Bcf/d of gas pipeline capacity, and his desire to make the pipeline application review process more efficient.
Chatterjee said the time it took for FERC to address the Atlantic Coast Pipeline project – 25 months – and the Mountain Valley project at 24 months, are conservative figures that do not include the time project owners spent during the pre-filing process, meeting with landowners and others interested in the projects.
As he did in remarks at the Energy Bar Association and in other venues, Chatterjee expressed a goal of improving the timeliness of FERC’s reviews, while acknowledging that the extended periods of review stem from entities outside of the Commission. State agencies, environmental groups, and others are challenging more elements of pipeline applications, which lengthen the amount of time it takes for the Commission to review a project, Chatterjee noted.
“My colleagues and commission staff are working hard to ensure that those extended timelines do not become the new normal for the FERC review process,” he said, asserting that he does not want to succumb to the notion that the time frame for the last project FERC approved sets a standard for future projects.
He sought to assure the audience that he is committed to streamlining the application review process and providing timely resolutions on issues associated with new pipeline facilities. He acknowledged this is not an easy task because opposition to pipeline projects “has become much more ideological driven than it used to be.”
Previously, opposition to projects was from local community interests affected by a project or individual landowners that challenged pipelines and the right of eminent domain awarded through a Natural Gas Act certificate approved by FERC. But today, Chatterjee related, there are national organizations that are well funded, with opposition to all forms of fossil fuels, C-list actors showing up at FERC meetings (a reference to James Cromwell, who was escorted out of the November meeting for speaking out against a Millennium Pipeline project), and Catholic nuns trying to block pipeline projects.
“There has been a sea change in the identity, volume, and goals of stakeholders participating in our proceedings, as well as the nature and tone of the rhetoric of those who oppose pipeline projects,” he said, likening the dynamic to opponents of nuclear energy that have been around for decades. The pipeline opponent groups are much more sophisticated, with political allies in state and federal government who know all the levers to push to frustrate pipeline development.
“The legal strategies they employ are clever ones,” targeting a variety of laws such as the Clean Water Act and the National Environmental Policy Act that involve actions from agencies beyond FERC to address pipeline applications, he said. The legal challenges of such groups mean that FERC expects to be involved in litigation on pipeline projects and it could force the Commission to become even more deliberate in its review processes to ensure that they will withstand judicial review.
Chatterjee emphasized that he does not view pipeline opponents as engaging in anything “sinister” through their challenges, noting that government rules giving voice to landowners and others affected by projects is “one of the things that makes this country great.”
But it can draw out the project review process, so he is looking to improve coordination and cooperation with other agencies and other steps to make FERC’s reviews more efficient. He also encouraged pipeline owners to submit complete and comprehensive applications and to use the pre-filing process to avoid needless delays.
Another bit of advice was to ensure that pipeline employees and construction contractors know they are essentially “ambassadors for the industry,” and that they need to be trusted members in the communities when pipeline construction takes place. Without naming names, Chatterjee warned that when mistakes are made during pipeline construction, they reflect poorly on the industry and it emboldens opponents to challenge more projects.
By Tom Tiernan TTiernan@fosterreport.com
This article appears as published in The Foster Report No. 3176, issued December 1, 2017
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