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FERC chair's priorities include grid resilience, LNG, but agency could be split

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FERC chair's priorities include grid resilience, LNG, but agency could be split

Advancing LNG projects was at the forefront of Federal Energy Regulatory Commission Chairman Neil Chatterjee mind as he rattled off his near-term priorities for reporters after the agency's first open meeting of 2019 held Jan. 17.

An ongoing grid resilience review, development of an updated transmission incentives policy, consideration of the 1999 pipeline certificate policy, work in the cybersecurity space and an effort to reform the Public Utility Regulatory Policies Act were also areas in which Chatterjee said he hoped to make progress during 2019.

With no shortage of issues to tackle, Chatterjee said he would prefer to have a full complement of five commissioners before making major policy decisions. "But that is outside of our control here, so we're going to continue to plow ahead on these myriad initiatives and let the nomination and confirmation process play out on its own," he said.

In the aftermath of Commissioner Kevin McIntyre's death due to illness Jan. 2, FERC is down to four members: Republicans Chatterjee and Bernard McNamee and Democrats Cheryl LaFleur and Richard Glick. The current roster perpetuates the possibility of 2-2 deadlocks down party lines, adding to uncertainty over the fate of more contentious issues.

Actions tied to FERC's grid resilience review could also be snarled by the current makeup of the commission, with McNamee under intense scrutiny to recuse himself from those matters. While a U.S. Department of Energy lawyer, he helped craft DOE's notice of proposed rulemaking to stem retirements of coal-fired and nuclear power plants.

A recent letter to Senate Democrats revealed McNamee would not participate in the pending rehearing request for the nixed DOE proposal, but ethics guidance left him free to vote on resilience issues as long as they do not "closely resemble" the DOE NOPR.

"I am confident [McNamee] will make the clear and correct ethical decision, but it's ultimately his decision to make," Chatterjee said of McNamee's role in the resilience docket. Given the amount of work that still needs to be done in that proceeding, he added that it would be "premature" to assess that docket's similarities with the DOE NOPR at this point.

How fast a fifth commissioner can be nominated and confirmed is potentially complicated by the partial government shutdown.

But "for better or for worse … [FERC's] profile has been raised considerably because of the significance of the issues that are before us, and I think there is a keen understanding at the White House, within the administration and in the US Senate of the importance of having FERC with a full complement of five commissioners," Chatterjee said.

"I've had numerous conversations with people that understand that filling this vacancy quickly is important," he added.

The commission has already hit a hurdle in the natural gas infrastructure space, where approval of an LNG terminal and a pipeline project were pulled from the agency's December meeting agenda and have yet to come back up for a vote. While most projects have advanced, LaFleur and Glick over the last year have expressed dismay with FERC's retreat from some of its prior greenhouse gas emissions calculations.

Pressed on the fate of LNG projects until a fifth commissioner is seated, Chatterjee said he was "hopeful" the commission was close to moving forward on applications. Asked whether a compromise on climate analyses and other issues splitting the commission could be reached, Chatterjee said there was agreement among his colleagues that orders approving projects must be able to withstand legal scrutiny.

Jasmin Melvin is a reporter for S&P Global Platts, which, like S&P Global Market Intelligence, is owned by S&P Global Inc.