The Trump administration has nominated James Danly, who has worked as a corporate energy lawyer since graduating from law school in 2013 and as the Federal Energy Regulatory Commission's general counsel since 2017, as the new nominee to fill the FERC seat left by Republican Kevin McIntyre, who died early this year. 

At the same time, the administration has failed to nominate a Democrat to replace Cheryl LaFleur, whose departure last month left FERC with a 2-1 Republican majority. If Danly is confirmed by the Senate while LaFleur’s seat remains vacant, it would leave FERC with a 3-1 Republican majority, an unprecedented break with the tradition of bipartisan representation on what’s meant to be an apolitical regulatory body. 

Clean energy and environmental groups, state governments and regulators, and free-market groups alike have expressed concern that Republicans Bernard McNamee and Chairman Neil Chatterjee are working to implement policies that will benefit economically struggling coal-fired power plants at the expense of other competing generation resources and state carbon emissions reduction policies. 

On Tuesday, several of these groups issued harsh critiques of the Trump administration’s decision to advance an unusually underqualified Republican nominee, while passing over qualified nominees from both parties. John Moore, director of the Natural Resources Defense Council’s Sustainable FERC Project, called the decision “a further erosion of longstanding norms [that] undercuts the independence and bipartisan decision making at FERC."

Senate Democrats, who have already criticized FERC’s leadership under Chairman Chatterjee, appear likely to fight the move. Senate Minority Leader Chuck Schumer (D-NY) reportedly threatened to block all legislation from the Senate Energy and Natural Resources Committee until a Democrat is nominated alongside a Republican. But Senate Energy Chairman Lisa Murkowski, Republican of Alaska, said she won’t let this break with precedent stop her from allowing a Republican nominee from moving ahead, Politico reported.

Lack of experience, uncertain views on key industry issues 

Before the White House tapped Danly as FERC’s general counsel in 2017, he worked for three years as an associate attorney with the energy regulation and litigation group at Skadden, Arps, Slate, Meagher & Flom. The nominee is also a former U.S. Army officer who served two tours of duty in Iraq and has previously worked as a law clerk for a federal circuit court judge and as managing director of the Institute for the Study of War, a military think tank in Washington, D.C.

But Danly’s three years of professional experience as an associate in a law firm’s energy practice is far less extensive than that of the typical FERC general counsel, let alone a FERC commissioner. This lack of experience, combined with a limited record of his views on key issues facing FERC, has drawn critics to accuse the Trump administration of picking an underqualified nominee in hopes of advancing a partisan agenda. 

These complaints have been bolstered by the Trump administration’s failure to take up other nominees to fill both Republican and Democratic openings on FERC. Senator Schumer in February nominated Allison Clements, now director of clean energy markets at the Energy Foundation and a former Natural Resources Defense Council attorney specializing in FERC and grid and energy market issues. Republicans were said to be considering David Hill, who served as DOE’s general counsel under President George W. Bush, as a nominee.

The Trump administration has failed to take action on Clements’ nomination, despite the tradition of “pairing” nominations that’s persisted at FERC for decades. Hill was dropped from consideration in March due to pressure from Energy Secretary Rick Perry and Bob Murray's Murray Energy Corp., a major backer of Trump’s 2016 election campaign, Politico reported. 

Though Danly has established a relatively limited record on how he feels FERC should regulate industry, he appears to favor a hands-off view that has drawn comparisons to the legal doctrines of the Federalist Society. 

“Danly has said that he wants FERC to be a ‘humble regulator,’” NRDC’s Moore wrote. “Before they vote on his nomination, senators must ask him what that means. Would Danly defer to the authority of states to set their own clean-energy policies? Would he continue FERC’s flawed climate review of pipelines that he defended in court?”

Sam Gomberg, senior energy analyst for the Union of Concerned Scientists, called Danly “woefully underqualified for the job,” a fact that he said could open him to manipulation by his Republican colleagues.

“Nominating someone with such little experience is absolutely a move to politicize FERC," said Gomberg. “If you nominate someone who doesn’t have the knowledge to do the job, what is he going to do? He’s going to acquiesce. This move is to consolidate power with Chatterjee, who has the power to set the agenda.”

Critics see rising politicization of FERC 

Danly’s nomination comes amid rising criticism of FERC from the interstate energy industries it regulates. Those industries suggest what’s traditionally been a bipartisan and technically focused body has become a partisan battleground over contentious energy and climate change policies. 

Republicans Chatterjee and McNamee have outvoted Democrat Richard Glick on a number of key decisions in the past few months, including a revamp of the federal PURPA law that could drastically its already-shrinking usefulness for renewables developers.

And Glick and LaFleur have issued excoriating dissents to decisions approved by FERC’s Republican majority — particularly last year’s surprise 3-to-2 decision to force mid-Atlantic grid operator PJM to rework its $10 billion a year capacity market in ways that could effectively bar state-subsidized nuclear, renewable and even fossil-fuel-fired power plants from participating.

Since then, FERC has failed to respond to PJM’s proposal, and has delayed action on an alternative, forcing PJM to postpone its annual auction three times this year. Meanwhile, McIntyre's death from brain cancer in 2018 and LaFleur’s retirement last month has left FERC with only three of its typical five commissioners, threatening to tie its hands against voting on key issues. The commission requires a three-member quorum to vote, which it currently lacks if even one commissioner cannot vote on an issue.

This quorum was thrown into further doubt recently, when Glick reported that a previous administrative error forced him to recuse himself until December from matters involving his former employer Avangrid, a utility group that does business across the country. The error leaves FERC without a quorum until at least December, meaning it can't vote on key issues such as PJM’s capacity market. That's likely to force a delay in the country’s largest capacity market until next spring. 

Meanwhile, McNamee was nominated last year by Trump after working on Energy Secretary Rick Perry’s attempt to force grid operators and utilities to support money-losing coal and nuclear plants in the name of grid resiliency. FERC unanimously rejected that proposal last year, and McNamee’s opponents have demanded he recuse himself from the successor proceeding on grid operator resilience.

But earlier this month, McNamee revealed that a waiver cleared him from the portion of the ethics pledge governing executive branch appointees, which would have required him to recuse himself from proceedings involving clients of his former law firm as well as a group of “former clients and their respective affiliates and subsidiaries” whose names have been blacked out in the waiver letter (PDF).