Richard Glick has a long list of priorities for his chairmanship of the Federal Energy Regulatory Commission. He has already outlined many of them, such as reforming energy market policies that restrict state-supported clean energy resources, expanding transmission capacity and unblocking new grid interconnections, and incorporating climate change impacts into the agency’s decision-making process.
On Thursday, in his first press conference since being elevated to lead FERC last month by President Joe Biden, Glick brought more clarity to some of FERC’s newest initiatives. These include creating a senior-level position to address environmental justice impacts of its decisions, including those involving natural-gas pipeline projects, to ensure they don’t “unfairly impact historically marginalized communities.”
A 2017 ruling from the U.S. Court of Appeals for the D.C. Circuit has put pressure on FERC to change its approach to accounting for the indirect greenhouse gas emissions impacts of natural-gas pipeline projects under its purview. Glick has since dissented against many of the pipeline decisions from the Republican majority at FERC on the grounds that they have failed to consider the greenhouse gas impacts of the projects in question but has been outvoted as the agency’s sole Democratic member.
FERC’s five-member board will retain a three-Republican majority through at least the first half of 2021, which is when Biden will have an opportunity to nominate a Democrat to replace departing commissioner Neil Chatterjee. Glick noted that this political reality implies that, on the matter of considering greenhouse gas impacts of its pipeline decisions, “no matter what we do, it will require three votes” to succeed.
The role of the newly created environmental justice position will be to examine if projects under FERC review will have significant health or economic impacts on communities, and if so, whether the projects can be moved or the impacts mitigated.
“Second, we need to have these communities' voices heard,” he said. “One thing I want to make sure is that they have some sort of comfort level that we’ll be taking their concerns seriously.”
“I’ve said it a million times, and I know some people don’t believe me; they think I’m against all-natural-gas pipelines,” he said. But he insisted that his concerns are centered on FERC’s responsibility to “find a project that’s both needed and in the public interest,” and that the latter requirement forces FERC to consider the adverse greenhouse-gas impacts of its decisions on the public.
Several large-scale natural-gas pipeline projects, including Duke Energy and Dominion Energy’s Atlantic Coast Pipeline, have been canceled in the past year under the pressure of rising construction costs and ongoing legal challenges. The Biden administration’s aggressive stance on decarbonizing the electricity sector and the broader economy includes its early decision to cancel federal permits for the Keystone XL pipeline, designed to carry crude oil from the tar sands of Canada’s Alberta province to U.S. refineries.
Glick said he hasn’t discussed the pipeline issue with the Biden administration, although he’s open to those discussions with “folks at the White House and the Department of Energy.” At the same time, “FERC’s an independent agency; we can’t be told what to do, and we’re going to work to build as much consensus among the commissioners as possible.”
Capacity markets, carbon pricing and transmission reform
This push toward consensus will include other issues that pitted Glick against his Republican colleagues over the course of the Trump administration, he said. For example, FERC’s Republican majority has issued orders that will restrict state-supported clean energy resources in the capacity markets run by mid-Atlantic grid operator PJM, New York state grid operator NYISO and New England grid operator ISO New England.
Glick has said he believes legal challenges to these FERC decisions will succeed, which will lead to replacement structures being worked out by grid operators and state and industry stakeholders. “I think all of them are taking a look at revising their approaches,” he said, adding, “I’m confident my colleagues will come up with a process that does not block state policies.”
FERC’s October decision to draft a policy statement that would allow grid operators to propose carbon-pricing regimes to the agency could open another avenue for creating market structures that preserve state energy policies that promote decarbonization, he said. Former Chairman Neil Chatterjee, a Republican, launched that carbon-pricing policy effort, and newly confirmed Democratic FERC Commissioner Allison Clements supports policies that account for carbon impacts in the wholesale markets that the agency regulates.
On the transmission front, Glick highlighted the need to reform FERC Order 1000, created a decade ago to bolster interregional transmission projects but which has had the perverse effect of incentivizing smaller-scale projects that can avoid the complex planning and cost-sharing negotiations required for projects that span multiple states and grid operator territories. He also pointed to the rising costs for clean energy projects seeking to interconnect to the transmission grid as an area in need of reform.
Glick also pledged to “build public confidence in the commission’s decision-making process” through an Office of Public Participation, with a new budget laid out as one of the energy policy reforms in the omnibus spending and COVID-19 relief bill passed by Congress in December.
Glick said he intends to further flesh out his top priorities at the upcoming FERC meeting on Thursday.