The federal electrical grid watchdog is suspending operations effective Saturday after the Obama nominee chosen to run the agency broke with protocol and resigned in the wake of President Trump’s inauguration.
With only two members, the Federal Energy Regulatory Commission will lack a quorum by the close of business Friday, limiting its ability to act on any major or contested decisions.
The commission’s acting chairwoman, Democrat Cheryl LaFleur, issued emergency procedures to handle the day-to-day load of electricity and energy market regulation until Trump nominates new members to fill the gap.
The five-member commission should include two Republicans and two Democrats, with the chairman being of the same party as the president. After Friday, it will be one member short of a three-person quorum.
Trump last week named LaFleur as acting chairwoman of the commission, who has support in the GOP. That decision was soon followed by Obama’s chairman, Norman Bay, announcing his departure Feb. 3.
Global consulting firm JD Supra issued a brief earlier this week calling Bay’s departure odd and saying that it places the agency in an uncommon position.
“Commissioner Bay’s resignation is unusual,” the brief said. “The traditional practice at FERC and other agencies is for an outgoing administration’s appointees to remain in place long enough to maintain a quorum until the new administration’s nominees can be confirmed by the Senate.”
Some have suggested that Bay’s departure may have been retaliatory, as the commission will likely be key to Trump’s infrastructure and energy plans. But it is not clear.
Bay issued a letter of resignation thanking the former president for the opportunity to lead the commission and praised the agency’s work. At the same time, environmental groups praised Bay’s departure for stalling pipeline development that they argue is bad for the environment and climate change by spurring fossil fuel development.
LaFleur on Friday gave senior FERC staff special limited authority to maintain the daily operations of the commission. In the meantime, contested issues and orders will have to wait until Trump nominates three Republican commissioners to serve on the panel.
“The commission anticipates not having a quorum for an indeterminate period, but has a continuing responsibility to carry out its regulatory obligations under the Federal Power Act (FPA), Natural Gas Act (NGA), and Interstate Commerce Act (ICA), among other statutes,” Friday’s order reads.
The Republican leadership on Capitol Hill will be charged with shuttling Trump’s nominees through a likely contentious confirmation process in the Senate. Democrats have been calling on FERC this week to reject natural gas pipelines that environmental groups have been fighting to connect fracking wells in Pennsylvania to the Northeast.
The commission grants permits to build and operate interstate natural gas pipelines, energy export terminals and hydropower dams, while regulating some of the largest deregulated electricity markets in the world.
Under a Trump administration, FERC “may start off being less inclined to push the boundaries of its statutory authority,” according to JD Supra. “However, under past Republican administrations, FERC has not been shy about exploring these limits — often successfully.”
The brief said it “remains to be seen whether FERC will become more conservative about exploring new frontiers of authority.”
The commission is facing increased pressure from the nuclear industry to enact market rules that help its aging power plants remain competitive as they face increased competition from natural gas and renewable energy. At the same time, companies that own natural gas power plants in the Northeast and Mid-Atlantic are asking the commission to reject New York’s clean energy subsidies for nuclear power plants through the commission’s administrative court process.
Decisions on those issues and others will be delayed with the lack of quorum.
