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Blog Post | July 20, 2021

FERC Nominee Must Be Independent From Utilities Driving Climate Crisis And Hurting Consumers

2020 Election/TransitionClimateEthics in Government
FERC Nominee Must Be Independent From Utilities Driving Climate Crisis And Hurting Consumers

This is an ongoing project and will be updated as the Revolving Door Project gains more information. 

June 30th marked the last official day of Republican Neil Chatterjee’s term as a commissioner on the Federal Energy Regulatory Commission (FERC). Despite FERC’s obscurity, it is a critically important independent agency of the federal government that regulates the interstate transmission of oil, gas, and electricity, and reviews proposals to build gas terminals and pipelines. As of July 1st, a new commissioner nominated by President Biden and confirmed by the Senate could have stepped in, giving the five-seat board a Democratic majority. Biden has thus far failed to begin that process, so Chatterjee will remain serving an expired term until Biden appoints and the Senate confirms someone new.

Politico reported on June 30th that there were three finalists for the position: Massachusetts state Rep. Maria Duaime Robinson, D.C. Public Service Commission Chair Willie Phillips, and IBEW member Tom Dalzell. Willie Phillips was rumored to be the frontrunner as of June 25th. But, as we’ve learned time and again throughout Biden’s administration, it’s not over until it’s over.

Willie Phillips

The possibility of Phillips being appointed to FERC is extremely concerning. As the current Chair of the D.C. Public Service Commission (PSC), Phillips should be leading D.C. to its stated goal of utilizing 100 percent renewable energy by 2032, all the while regulating monopoly services, protecting consumers, and advocating for lower rates. Unfortunately, this has not been the case. Electric utility Pepco, (which still uses coal and gas for a majority of its energy power) along with companies like Washington Gas, have a stranglehold on Phillips, and thus on D.C. itself. 

While on the PSC, Phillips buckled under pressure to approve electricity giant Exelon’s purchase of Pepco, further monopolizing utility services in the Mid-Atlantic and negatively impacting consumers via higher rates and worse service. Exelon is the largest electricity parent company in the United States by revenue. Over half of D.C. neighborhood governments, several council members, climate activists, and solar energy advocates vehemently opposed the merger. But at the actual takeover hearings, Phillips didn’t even ask any questions. Phillips’ callousness toward these District residents in favor of Exelon does not bode well for his potential time at FERC, which is responsible for reviewing certain mergers and acquisitions by electricity companies. 

The PSC also voted in June of 2021 to approve Pepco’s $108 million rate hike, increasing energy prices for consumers. The Office of the People’s Counsel, the federal government, the District government, the Apartment and Office Building Association of Metropolitan Washington, and D.C. unions all opposed the move. People’s Counsel’s Sandra Mattavous-Frye said of the decision, “There was no support in the record for the multiyear rate plan, and the PSC’s approval locks District residents into funding Pepco based on a proposal that was designed to protect the company and its shareholders at the expense of customers.” 

Pepco has previously been ranked by customers as the all-time worst company, ahead of even giants like Comcast, Bank of America, JPMorgan Chase, UnitedHealth Group, and American Airlines. The company was also found to be the country’s worst utility at connecting interested residents to solar power, leading to long delays in connecting customers to the electric grid and reflecting credits to their bill. The PSC is the body responsible for holding Pepco accountable for failures such as this one. Clearly, they are rewarding Pepco instead. 

Pepco has enormous influence on D.C. as a whole — Mayor Muriel Bowser’s Senior Advisor was previously a senior executive at the company, and it has been rumored that Pepco has informal veto and approval power in the Mayor’s pick for D.C. Public Service Commissioners — and Phillips’ record suggests that he is no exception. His apparent loyalty to utility companies is not appropriate considering FERC’s singular mission is to advocate for consumers to obtain economically efficient, safe, reliable, and secure energy services. 

The problem with Phillips is not that he is inexperienced. The problem is the nature of his experience. He has spent years working for corporate law firms that represent oil and gas interests, counseling the electric utility industry on corporate and regulatory matters, and driving up profits for Pepco in the nation’s capital. He also has a record of public service — but that record is not one which many residents of D.C. would applaud.

Biden has promised to fight for climate action and restore faith in the government. A FERC including Phillips is unlikely to fulfill those promises. Biden needs to appoint someone with a record of unambiguous independence from the companies which have brought the world to the brink of catastrophe.

Tom Dalzell

Tom Dalzell is a 30-year member of the International Brotherhood of Electrical Workers and apparently has support from multiple unions. But scratching the surface of his actual record reveals a history of stubbornly siding with industry utilities over the public interest and a failure to prioritize climate action. This should be completely disqualifying. 

In a March 2021 convening of the National LAMPAC, an energy industry-union collaborative, Dalzell was presented an award for his efforts to advance local initiatives on behalf of Edison Electric Network, the association that represents all U.S. investor-owned electric companies, as well as IBEW members. Dalzell was praised for “[working] collaboratively with PG&E to defeat municipalization efforts in San Francisco and West Sacramento, to rebuild a safety culture after the catastrophic 2008 gas transmission line explosion in San Bruno, California, to address in a rational and balanced manner the wildfires plaguing northern California for the last five years, and to bring PG&E out of its second bankruptcy in 20 years.” (Emphasis added.) Joe Manchin and Lisa Murkowski, a relentless proponent of oil drilling, were honored at the same convening. 

To translate industryspeak into plain English, “[working] collaboratively with PG&E to defeat municipalization efforts” means that Dalzell advocated to prevent the residents of two major cities from gaining public ownership over universally necessary utilities. He did this favor on behalf of a nearly $100 billion natural gas and electric utility company. Public ownership usually lowers prices and makes it easier for cities to make the move to renewable, non-fossil energy. Dalzell essentially was congratulated for siding with corrupt Pacific Gas & Electric rather than allowing what over 70 percent of local residents decided was in their best interest. In February of 2020, Dalzell also attacked Senator Bernie Sanders for his support of a public takeover of PG&E. These actions do not bode well for a FERC that needs to initiate people-centered climate action over corporations approximately yesterday.

Dalzell was then congratulated for “rebuilding a safety culture after the catastrophic 2008 gas transmission line explosion in San Bruno, California.” Eight people were killed and 38 homes were destroyed in that explosion. The National Transportation Safety Board blamed PG&E and said the company had exploited a lack of monitoring by regulators. But Dalzell argued that the $4 billion penalty levied by the California Public Utilities Commission against PG&E for its role in the explosion was excessive. It is unclear what kind of “safety culture” Dalzell helped to create, but it was no success for PG&E, whose equipment and service failures directly caused over 100 more deaths in the next decade. In general, when someone thinks the best way to handle a company’s deadly record is an internal cultural shift instead of external regulation (which is a false dichotomy, by the way; there can and should be both), they probably aren’t suited for a job as a regulator.

It remains quite a mystery what addressing wildfires in a “rational and balanced manner” could possibly mean. What exactly was Dalzell “balancing” — reduced profits for PG&E with loss of actual lives? PG&E has been  found responsible for starting several deadly wildfires, and by the nature of its fossil fuel usage, it is also driving climate change in a more general sense. This, of course, is setting the stage for more and bigger wildfires. It should go without saying that knowingly worsening climate disaster is neither rational nor balanced.

Dalzell’s claim that he helped bring PG&E out of its second bankruptcy in 20 years is even less inspiring. PG&E, California’s largest utility, filed for bankruptcy precisely because they could not deal with the billions of dollars in wildfire liability that came after the company caused over 1,500 California fires between 2013 and 2019, including the deadliest ever. PG&E emerged from bankruptcy some 18 months later, largely unscathed, and still has not fully paid out its promised settlement to fire victims. The company has also not changed its practices — instead it asked regulators last month for a $3.6 billion rate hike and continues to fight against rooftop solar projects throughout the state. Talk about a failure to serve the people.

Dalzell has long been a close ally, and even a top lieutenant, of Robbie Hunter, the president of the State Building & Construction Trades Council of California. Besides oil companies themselves, Hunter has been one of the most stubborn barriers to reducing oil and gas extraction in the state, defending oil refineries and accusing environmental activists of holding “extreme opinions.” 

Dalzell has also proven himself to be a terrific impediment to climate action. In 2017, he and the IBEW Local 1245 opposed a 2017 California bill that would have required the state to stop using fossil fuels for electricity by 2045. His reasoning? “We have a parochial self-interest in this.” 

After massive heat waves hit Californians across the state in 2017, in an ironic twist, Dalzell wrote an op-ed for the San Francisco Chronicle stressing the importance of gas-powered electricity to keep the state cool. (A brief reminder that “natural” gas as a bridge fuel is both harmful and unnecessary).

Dalzell is unfit to serve on FERC for a simple reason. As Matt Kasper of the utility industry watchdog Energy and Policy Institute said, “Dalzell’s record suggests that he will continue to be a warrior for investor-owned utilities at a time when FERC will have to decide on a host of issues that directly impact these companies, such as policies governing pipelines and the build-out of transmission lines. It is critically important for President Biden to nominate someone that will actually be independent at the Commission and not one who has been working for years to help the industry ensure favorable policy outcomes.”

Those trusted to make crucial decisions throughout the federal government must have proven independence from the corporate entities they are tasked with regulating. Anything else is a win for the corporate oligarchy and a massive loss for the rest of us.

Maria Duaime Robinson 

Maria Duaime Robinson is the most independent option of the apparent three frontrunners, but her record advocating for gas as an advanced energy source and supporting gas-related projects as a Massachusetts legislator means she is still not the ideal pick for FERC.

Robinson has been a member of the Massachusetts House of Representatives since 2019 and won reelection in 2020. During her time in office she has shown a decent commitment to renewable energy advancement and climate action, cosponsoring a bill to transition Massachusetts to 100 percent renewable electricity and net zero carbon emissions across all sectors by 2030 and cosponsoring several other bills to consider environmental justice communities throughout the process. She has also sponsored and cosponsored bills supporting electric vehicle infrastructure.

Being proactive about renewable energy and electric vehicle projects is good, but it is next to meaningless when paired with gas infrastructure. Unfortunately, advocating for gas as a clean “advanced energy” strategy is how Robinson has operated for many years, writing op-eds, presentations, and blog posts to that effect. In a 2016 letter in the Philadelphia Inquirer titled “Clean Energy Produces Jobs, Too,” she said advanced energy “includes technologies such as wind, solar, and nuclear power; natural-gas generation.” 

Anything less than a complete and timely phase-out of all fossil fuels is unacceptable considering climate disaster is upon us and gas (even as a “bridge fuel”) is both harmful and unnecessary

The commissioner nominated to fill out FERC will be the tie-breaking vote between two mostly environmentally-minded Democrats and two mostly pro-gas Republicans. Who Biden nominates to this position will have enormous, reverberating effects throughout this decade’s response to climate emergency and beyond. It cannot be someone friendly towards gas or corporate power.

Image: “Close to power lines” by WSDOT is licensed under CC BY-NC-ND 2.0

2020 Election/TransitionClimateEthics in Government

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