Tuesday, October 16, 2018

Trump Nominates DOE’s McNamee to FERC

‘Fuel Wars’ Likely in Confirmation Fight

By Rich Heidorn Jr.

McNamee | © RTO Insider

President Trump on Wednesday nominated the Department of Energy’s Bernard McNamee to replace former FERC Commissioner Robert Powelson — a pick that could be crucial to the administration’s efforts to support at-risk coal and nuclear generation.

Powelson, who left the commission in August to head a trade organization, was a vocal opponent of the Trump administration’s bid to provide price supports to coal and nuclear generators. McNamee, a former aide to Sen. Ted Cruz (R-Texas), was among the DOE officials who designed and lobbied on behalf of the plan.

Lobbying for Price Supports

Last November, McNamee joined FERC Chief of Staff Anthony Pugliese to make the case for coal and nuclear price supports at a breakfast meeting of the Consumer Energy Alliance (CEA) on the sidelines of the National Association of Regulatory Utility Commissioners’ Annual Meeting in Baltimore. Watchdog group the Energy and Policy Institute has described CEA as “a fossil fuel-funded advocacy group.” (See DOE, Pugliese Press ‘Baseload’ Rescue at NARUC.)

FERC Chief of Staff Anthony Pugliese, left, and Bernard McNamee, center, head of DOE’s Office of Policy, made the case for coal and nuclear price supports at a breakfast meeting of the Consumer Energy Alliance on the sidelines of the NARUC Annual Meeting in Baltimore in November 2017. Michael Whatley, right, CEA’s executive vice president, moderated. | © RTO Insider

In January, FERC voted 5-0 to reject Energy Secretary Rick Perry’s Notice of Proposed Rulemaking to save at-risk coal and nuclear plants and instead opened a docket to consider resilience concerns. In June, however, Trump ordered Perry to save coal and nuclear plants under an obscure Korean War-era law. That effort is still pending, although the Washington Examiner reported Friday that it may have stalled in the face of opposition by conservative, free-market groups.

A graduate of the University of Virginia and Emory University School of Law, McNamee has had a variety of political and legal jobs in Texas, Virginia and D.C. In addition to stints at the law firms of Hunton & Williams (now Hunton Andrews Kurth), Williams Mullen and McGuireWoods, he spent time in the attorney general’s offices in Texas and Virginia and was policy director for former Gov. George Allen’s (R-Va.) 2000 U.S. Senate campaign.

After serving as Cruz’s senior domestic policy adviser and counsel from July 2013 to November 2014, he spent a year as chief of staff to the Texas attorney general, where his LinkedIn profile said his work included “challenging the federal government on environmental regulations, defending religious liberty and promoting federalism.”

He first joined DOE as deputy general counsel for energy policy in May 2017 but left after 10 months to become the director of the Texas Public Policy Foundation’s Center for Tenth Amendment Action and Life: Powered, a project to “reframe the national discussion” about fossil fuels.

‘Blessed’ by Coal, Natural Gas

In an op-ed published in The Hill on Earth Day in April, McNamee defended fossil fuels against criticism over their environmental damage. “America is blessed with an abundant supply of affordable natural gas, oil and coal. When we celebrate Earth Day, we should consider the facts, not the political narrative, and reflect about how the responsible use of America’s abundant resources of natural gas, oil and coal have dramatically improved the human condition — and continue to do so,” he wrote.

He returned to DOE in June as executive director of the Office of Policy.

In July, McNamee defended the administration’s plans for price supports in a hearing of the Senate Energy and Natural Resources Committee. “A lot of the organized markets have distortions in them that aren’t representative of an actual free-serving market, so the thought is you need to remove some of those distortions and get some more parity,” McNamee said.

Reaction

Michelle Bloodworth, CEO of pro-coal group ACCCE, called Wednesday for McNamee’s “swift confirmation.”

“FERC has a critical role in assuring that wholesale markets value resilience attributes, especially fuel security. McNamee’s background and experience at the state and federal levels make him well qualified to be the next FERC commissioner,” she said. ACCCE says about 120 GW of coal-fired generating capacity, about 40% of the remaining fleet, has retired or announced plans to do so.

“If McNamee is confirmed to FERC, he will abuse that authority to lead the charge to force taxpayers to spend tens of billions of dollars to bail out old, expensive coal and nuclear plants, at the expense of cleaner, cheaper competitors like solar, wind and grid storage,” Mary Anne Hitt, senior director of Sierra Club’s Beyond Coal campaign said in a statement when McNamee’s name was floated as a potential nominee in August. “Trump is hoping to install a crony at FERC who will unfairly tip the scales in favor of propping up those failing industries.”

“Powelson’s departure was widely seen as opportunity for the White House to more closely align FERC with its own policies,” said Stoel Rives partner and FERC practitioner Jason Johns. “It is my belief that Powelson’s opposition to certain policy efforts came as a surprise to the White House, particularly the White House’s efforts to subsidize coal and nuclear facilities. I’m confident the White House is looking to address those surprises with this choice. ”

“FERC has a longstanding commitment to fuel-neutral regulation, but Mr. McNamee’s past writings and career track record suggest that he would seek every opportunity possible to support fossil fuels,” said John Moore of the Sustainable FERC Project.

Strategy

ClearView Energy Partners suggested McNamee, a Republican, might be paired with a Democratic nominee to replace Commissioner Cheryl LaFleur if the GOP retains a majority in the Senate. LaFleur, whose term expires June 30, 2019, is unlikely to be renominated, ClearView said.

However, Senate Majority Leader Mitch McConnell (R-Ky.) could push McNamee’s confirmation more quickly to restore the 3-2 Republican FERC majority, the consultants said.

Although LaFleur and fellow Democrat Richard Glick have repeatedly been on the losing end of 3-2 natural gas pipeline orders, the departure of Powelson has raised the prospect that pipeline approvals could stall in the face of 2-2 deadlocks.

Last month, E&E News reported that the Trump administration also was vetting Florida Public Service Commission Chairman Art Graham, a self-described conservative and nuclear power supporter, for a FERC seat.

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