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Chatterjee hopes FERC can reach 'consensus' on interim action for at-risk plants

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Chatterjee hopes FERC can reach 'consensus' on interim action for at-risk plants

Neil Chatterjee no longer chairs the Federal Energy Regulatory Commission but hopes that he and his fellow commissioners can agree on interim help for economically struggling coal and nuclear power plants until the agency takes longer-term action.

"I'd still like to get consensus on an interim step but understand that it's complicated," Chatterjee told reporters following a Dec. 11 event in Washington, D.C., hosted by Axios. "I myself have said I don't want to do anything to distort markets, to alter behavior, to unnecessarily cost consumers, so trying to land that is difficult. It's complex."

Chatterjee, a Trump administration appointee, chaired FERC for about four months until new Chairman Kevin McIntyre was sworn in Dec. 7. During Chatterjee's time as chairman, the U.S Department of Energy asked FERC to create a rule ensuring power plants with at least 90 days of fuel supply on-site can fully recover their costs in regions with wholesale electricity and capacity markets if those plants are not already subject to cost-of-service arrangements. Such a rule would largely benefit coal and nuclear plants located in the PJM Interconnection.

In addition to working to meet the DOE's Dec. 11 deadline to take action, Chatterjee wanted FERC to take interim steps to prop up financially struggling coal and nuclear plants until the commission crafts a final, longer-term grid resilience rule.

But the same day he was sworn in, McIntyre asked Energy Secretary Rick Perry to give the commission an extra 30 days, until Jan. 10, 2018, to take final action on the proposed rulemaking, a request Perry reluctantly granted. So far, Chatterjee has been the most vocal proponent of interim support for at-risk power plants. To get approval for an interim plan, Chatterjee would have to convince at least two other commissioners at the five-member FERC to side with him, a potentially tough task given some commissioners' skepticism of the DOE proposal.

In terms of gaining support for interim action, Chatterjee said Commissioner Robert Powelson, who has vowed that FERC will not upend competitive markets in its response to the DOE request, "has been looking at the docket" and is a "serious thinker."

Powelson will sit down with McIntyre, Commissioner Richard Glick, Commissioner Cheryl LaFleur and Chatterjee "and we'll talk through all these things," Chatterjee said. He added that he has "no comment" on a rumored plan from LaFleur and Powelson to issue a notice of inquiry to regional grid operators on bulk power system resilience without seeking any interim support for vulnerable plants.

"I agree that FERC speaks loudest when it speaks with one voice, and I'm hopeful the five of us can get together and come to that one-voice consensus," he said.

Chatterjee, who was in Boston when McIntyre was sworn in, said he did not know the new chairman was going to ask for more time on the DOE proposal until McIntyre sent the request to Perry but he understood McIntyre's need for an extension.

"Chairman McIntyre just got in on [Dec. 7]," Chatterjee said. "I think it was totally prudent to ask for more time given the fact that he would have had one working day to look through things before December 11." The extension "doesn't necessarily mean we have to take the full 30 days," Chatterjee added.

He said he was meeting in person with McIntyre on Dec. 11 for the first time since the new chairman's swearing in and the DOE proposal would likely come up.

Despite his push for quick action, Chatterjee stressed that one of his main priorities is conducting a longer-term analysis of grid resilience that is "data-based, fact-based and legally defensible." He called co-located energy storage and solar power an "exciting possibility" for improving resilience and said natural gas-fired plants are capable of providing baseload power, which "may answer the question that there is no issue with resilience."

Building a long-term, thorough record of U.S. grid resilience and needed assets may not happen quickly. "The reason that I focused on an interim solution is that building a robust record on resilience, I believe, will take time," Chatterjee said. "It's complicated."

Although the DOE grid resilience proposal has received a lot of attention, Chatterjee pointed out that FERC has other big items on its plate. The commission is working quickly to finalize a proposed rule requiring regional transmission organizations and independent system operators to more fully integrate energy storage resources in wholesale markets (FERC dockets RM16-23 and AD16-20).

"It's just a complicated rulemaking [and] difficult to work through, but ... I believe there's total consensus at the commission among our colleagues that it's smart policy, good policy, and we need to get it done," Chatterjee said.

He also dismissed the idea that his recent spat on social media with Hollywood actor James Cromwell over FERC's role in permitting pipelines will affect his ability to act impartially on those projects.

"I thought it was surreal that an actor whose performances I've rather enjoyed in a couple of movies was criticizing me personally and I was making light of that," Chatterjee said. "I was trying to do it in a funny way, not mean or nasty."