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Commissioner Richard Glick Statement
March 19, 2020



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Statement on COVID-19 & FERC Orders

Today, in light of the cancellation of the Federal Energy Regulatory Commission’s (FERC) regular March Open Meeting and the notational consideration of the orders the Commission would have addressed at the meeting, Commissioner Glick released the following statement:

“First, I want to say my thoughts are with our fellow Americans as we continue to battle the novel Coronavirus, COVID-19 pandemic. This is a serious situation and I urge everyone, where possible, to stay at home as we race to flatten the curve of this global pandemic and save lives.

“FERC is working closely with the North American Electric Reliability Corporation (NERC), Electricity Subsector Coordinating Council (ESCC), and the National Association of Regulatory Utility Commissioners (NARUC) to help keep the lights on. My team and I are teleworking at home, but we will attempt to operate as close to normal as possible. People should not hesitate to reach out to my office with any issue that may arise. I will continue to work with my colleagues, staff, and stakeholders to fulfill FERC’s vital mission of ensuring economically efficient, safe, reliable, and secure energy for consumers. 

“I do hope, however, that the Commission proceeds judiciously over the next several months on orders that are not statutorily mandated. The Federal Power Act and the Natural Gas Act require parties to seek rehearing of orders within 30 days of the date FERC issues that order. The Commission has no flexibility to waive this 30-day requirement. To the extent Commission action is not statutorily required or needed in the short-term, I believe we should refrain from acting to allow parties who are otherwise dealing with the pandemic to avoid putting resources toward seeking rehearing of a Commission order. In that same spirit, I want to commend the Chairman for taking action to extend deadlines where the Commission has the flexibility during this difficult period.

“With respect to the orders the Commission is issuing today, I will be dissenting or dissenting in part on several orders and want to highlight my concerns over three of these orders:

Jordan Cove                                                             Doc. No. CP17-495-000, CP17-494-000

  • It appears that this time the Commission will actually be voting 2-1 to approve the Jordan Cove LNG project and a related pipeline.

  • I believe today’s decision plainly violates the requirements of both the Natural Gas Act and the National Environmental Policy Act in order achieve an outcome-oriented desire to approve the projects.

  • As is the norm these days, this order fails to consider the impact the projects’ greenhouse gas emissions will have on climate change

  • But the projects also would also significantly impact 20 threatened and endangered species, historic properties, short-term housing, and noise levels in the vicinity of the projects.

  • As the order points out, the Commission was unable to mitigate several of these significant impacts, but yet the Commission finds that these adverse impacts are acceptable and is approving these projects without actually demonstrating how whatever benefits the projects may bring outweigh these adverse impacts. That is not only irresponsible, but it is against the law.

  • I also think that FERC cannot ignore the changes in the global LNG landscape, including recent events.  Instead, we must evaluate whether the proposed LNG projects we are reviewing are actually going to be built. By issuing a Certificate for the pipeline needed to serve the LNG facility, the Commission is giving the developer the ability to immediately begin the process to take land via eminent domain when the future of the Jordan Cove LNG project – and perhaps other proposed LNG projects – remain very much in doubt. The Commission should consider these factors in its determination that the associated pipeline is actually needed.   

Transmission Incentives NOPR                                                         Doc. No. RM20-10-000

  • The Commission today is issuing a Notice of Proposed Rulemaking (NOPR) that would revise our transmission incentives policies.

  • Although I support parts of the NOPR – for instance, I agree that the Commission should eliminate the current incentive for transmission facilities built by Transcos – I am dissenting in part because I believe several of the proposals do not constitute reasoned decisionmaking. For example:

    • The Commission is proposing to provide incentives only for transmission projects that meet economic efficiency thresholds, unless there would be significant reliability benefits.  I am concerned that this approach altogether ignores transmission projects needed to meet public policy goals, such as state carbon reduction targets, which are the country’s most pressing transmission needs. I encourage parties to provide comments on the differing methods of measuring benefits. 

    • The Commission is proposing to double down on the incentive available to utilities that remain in an RTO, ignoring Congress’ admonition that the incentive is supposed to be for “joining” an RTO, not remaining in one. Even worse, the NOPR proposes to double the size of this incentive from 50 basis points to 100 basis points—even though there is nothing in the record to suggest that any transmission owner would leave an RTO if not for that handout.  Simply put, the Commission wants to double the cost to consumers of an “incentive” that does not incentivize anything.

    • The Commission is proposing to eliminate the overall cap on the amount of ROE a utility can recover and instead cap the total amount of incentives for each utility at 250 basis points without any evidence to suggest that transmission owner rates would be just and reasonable as the statute requires.

    • The bottom line is that the approach outlined in the NOPR focuses narrowly on the transmission needs of today and will do little to help the country build the transmission grid of the future.

    • I look forward to reviewing the comments submitted on these and other issues I identify in my partial dissent.

  • I also believe we should have provided parties 120 days, rather than 90 days to submit their comments in this important proceeding. Suffice it to say, utilities and other interested parties have more important things on their plate at the moment. We should let them focus on that.

MISO Zone 4                                                                                      Doc. No. EL15-70-002

  • I am also dissenting from today’s order denying rehearing of the Commission’s earlier order concluding that the results of MISO’s 2015/2016 capacity auction are just and reasonable.

  • As I pointed out in my dissent from that order, the Commission has not adequately addressed concerns that the auction prices were the result of market manipulation. Therefore, I do not think they can support the finding that the auction results are just and reasonable. 

  • The Commission conducted a non-public investigation into allegations that the results of the auction were tainted by market manipulation. Unfortunately, Chairman Chatterjee unilaterally chose to terminate the associated enforcement proceeding even though, in my view, the investigation provided more than enough evidence to conclude that the enforcement proceeding should have continued.

  • I believe in competitive markets. But if we are going to rely on competition to establish just and reasonable rates, we must be vigilant to prevent market manipulation. Unfortunately, the Commission’s action in this instance fell short. 

 FERC Commissioner Glick’s full statements from today’s orders will be available at http://www.ferc.gov/about/com-mem/glick.asp






                                               

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