Trump Nominations May Unblock Billions in Stalled Fossil Investment
U.S. President Donald Trump has named two advocates of states’ rights to the country’s pre-eminent energy regulator, the Federal Energy Regulatory Commission (FERC), in a move to unfreeze an estimated US$50 billion in oil and gas infrastructure investments.
The docket now before FERC for review includes projects proposed by Canada’s two biggest pipeline companies, Enbridge Inc. and TransCanada Corporation.
Like this story? Subscribe to The Energy Mix and never miss an edition of our free e-digest.
The two nominees, an aide to Senate Majority Leader Mitch McConnell (R-KY) and a Pennsylvania state utility regulator, will have to take their seats before the five-member FERC can declare a legal quorum. As a result, Bloomberg wrote before the nominations were announced, “at least a half-dozen pipelines valued at US$12 billion face imminent delays,” while projects worth another US$38 billion have seen their advance through the permitting process halted.
One of those projects is a 410-kilometre gas pipeline from Ohio to Ontario, partly owned by Enbridge and scheduled to make its first deliveries by autumn. Another is TransCanada’s US$850-million, 50-kilometre WB Express line, meant to ease a congestion point between Marcellus Shale gas fields and distributors on the U.S. East Coast.
“FERC’s lack of a quorum thwarts its work in other ways,” Bloomberg notes. “Its two remaining members [subsequently winnowed down to one] can’t approve new hydropower plants [or] rule on contested utility mergers. A proposed rule on commercial battery storage is on hold.”
The new nominees are viewed as strong defenders of states’ autonomy in energy regulation, but their views on national policies like a potential carbon tax—an idea gathering support among some Republicans—has yet to be revealed. Neil Chatterjee worked for the National Rural Electric Cooperative Association before serving as McConnell’s aide. Robert Powelson is a member of the Pennsylvania Public Utility Commission. Nomination of attorney Kevin McIntyre to lead the Commission was rumoured but not confirmed.
A smooth ride through Senate confirmation could restore FERC’s quorum as early as May 29, Bloomberg suggests, citing Washington insiders. “However, Democrats concerned about the environmental costs of massive gas projects could slow the process.” The last appointment to the Commission, in 2014, took six months to confirm.