Week Ending February 5, 2021

Christie Addresses Certificate Proceedings, Independence of FERC, Experience at SCC

This Article Appears as Published in Foster Report No 3335

FERC Commissioner Mark Christie is a strong proponent on the independence of FERC, the role of states as laboratories of democracy and full reviews of certificate proceedings for new infrastructure, where different views are made known and aired.

In a February 2 interview with The Foster Report, Christie reflected several times on his nearly 17 years of experience at the State Corporation Commission (SCC) of Virginia and how that regulatory experience has helped him. That experience has included teaching a regulatory law class at the University of Virginia law school and orientation for new state regulators through the National Association of Regulatory Utility Commissioners (NARUC).

While noting that interactions with Congress and the federal perspective is different than a single state legislature, Christie said the principle of independence is something that he carries from the SCC to FERC, as he told lawmakers during his Senate confirmation hearing.

He vowed to defend that independence from the White House, and he pointed out that he made that pledge to senators before the presidential election, without regard to which political party controls the executive branch. Several senators from both political parties asked about that, and “I fully intend, as a member of FERC, to uphold the pledge I made to those senators.”

President Joe Biden issued an executive order on climate change, steps to address greenhouse gas emissions, infrastructure reviews and agency actions through the National Environmental Policy Act (NEPA). The executive order has “a lot to unpack,” Christie said, noting that he has not gone through every element of the order or reached any conclusions about what it might mean for FERC.

The Commission’s review of natural gas pipeline applications under the Natural Gas Act (NGA) and complying with NEPA have been the subject of dissents from Richard Glick when he was a commissioner, and now that Biden has made Glick chairman, observers are watching for how pipeline reviews will proceed.

In a past interview with The Foster Report, Glick said he believes FERC has the authority to deny a pipeline application if the downstream effects show excessive GHG emissions after weighing project benefits and other factors.

When asked if he believes FERC has the authority to reject a pipeline application based on indirect emission effects, Christie said he has not drawn a legal conclusion on that, and it has not come up in a proceeding while he’s been at FERC. “I’ve not drawn a legal conclusion on the extent of the GHG analysis under NEPA,” he said during the interview. “I’m sure I’ll get the opportunity to do it,” at some point, when presented with a case where that is at issue, he said.

Christie told several senators the same thing – that he has not drawn a legal conclusion — when they asked a similar question during his confirmation process, he noted. “I said it because I meant it,” he said.

At the January 19 meeting, Commissioner Allison Clements expressed a desire to have FERC examine its gas pipeline certificate policy statement, which dates to 1999 and was the subject of a Notice of Inquiry (NOI) in 2018. That proceeding (PL18-1) has laid dormant for several years as FERC has not had a full complement of five commissioners.

Christie said it is up to Glick on when or if he wants to bring that issue back before the Commission.

Without speaking to the specific questions posed in the NOI, Christie said he has a perspective on how certificate proceedings should be held, presiding over many while at the SCC.

Addressing power transmission line development and siting, Christie said any infrastructure stretching several hundred miles will face opposition, and reviewing applications should be done comprehensively, fairly and with a thorough development of the factual record. For transmission facilities and power generation decisions, “we didn’t rubber stamp anything,” and some certificate applications were rejected by the SCC during his time as commissioner, which goes back to 2004. Thorough litigation of all issues during the fact-finding portion of certificate proceedings makes for strong certificates, and Christie said he is proud of the track record that SCC certificate orders almost always stood up after legal appeals.

Regional transmission organizations (RTOs) are responsible for transmission development in organized wholesale power markets, and when asked if FERC should do more to spur grid expansions to support the changing generation mix, Christie said there has not been a proceeding brought to FERC to carry out such a plan.

State authority on transmission line siting has sometimes been referred to as a hindrance for a more complete buildout of the power grid to support clean energy projects. In a late-January report from Americans for a Clean Energy Grid, authors said the time has come for FERC to strengthen transmission planning through a new cost allocation rule.

Utilities outside of RTOs are responsible for transmission development in those areas, and no system is perfect, Christie said during the interview.

One concern he will focus on is the cost of transmission, which has been rising in the eastern RTOs and passed on to consumers. “It’s not an argument to not build more” transmission or a reflection that he’s prejudging the issue, he said, but as a former state regulator who passed through costs to retail customers, Christie will remain cognizant of transmission costs and the effect on utility customers.

During the January 19 FERC meeting, Christie said he hopes FERC can examine the interplay between state public policies and RTO markets in a broad proceeding. There are competing interests and valid views that could perhaps be meshed or fleshed out better in a generic form. “This is a big policy issue. And it lends itself to being teed up in a proceeding where all the interested parties and groups can come and have their say,” which is not the case when individual proceedings are used to address capacity markets and other issues dealing with state policy preferences.

Of the five commissioners at FERC, Christie is the only one who served as a state regulator, and he brings a strong respect for the positions of states in his role at FERC. He has quoted former Supreme Court Justice Louis Brandeis, who referred to states as the laboratories of democracy, and during the interview noted that his time leading OPSI and through NARUC clearly illustrated that states do not have one view on energy policies. With 50 states, there will be different state views, as “the only thing states agree on is ‘don’t infringe on our authority,’ ” he said.

The state Legislature in Virginia passed a lot of laws while Christie was at the SCC. “Quite frankly a lot of them were not bills that I personally agreed with or thought were in the best interests of consumers or industry. But they passed them and I certainly had to carry them out and did so,” he explained.

State lawmakers can be more active in passing laws than Congress, and with a short legislative calendar in Virginia, Christie said tracking legislation while at the SCC was like “sipping from a fire hose.” Congress operates differently, and law students in his class would sometimes argue that lack of action by Congress presents a strong argument for agencies to act on their own. “An administrative agency only has the authority that Congress grants to it. And that’s how democracy works.” Lawmakers in Congress are elected by the people, and for those who believe agencies should take actions without action from Congress, “that’s not how democracy works,” Christie said.

Among the items that Christie did not vote on at the January 19 meeting were three orders involving Mountain Valley Pipeline (MVP), which is being built amid legal challenges to move natural gas from Appalachia into southern Virginia. He did not indicate at the meeting if he would vote on items involving MVP, but issued a statement afterwards following media inquiries.

That statement notes that the MVP items on the agenda may relate to his time at the SCC. “Having joined FERC only two weeks ago, Commissioner Christie sought to maximize his ability to contribute to today’s open meeting by participating in the many items that presented no such potential overlap.  Commission Christie may explore such issues in these proceedings in the future,” according to the statement.

During the interview, Christie said he would stick to what is in the statement.

During his time in NARUC, Christie said one of the lessons he shares with new state regulators coming into NARUC is that they should examine the political culture of their state and figure out where they fit in that culture.

Because the SCC operates under the Virginia judicial code of conduct, along with a regulatory code of conduct, commissioners would rarely be able to have meetings with outside parties affected by agency actions. While abiding by ex parte regulations at FERC, Christie noted that he is enjoying getting to meet with different groups and hear different perspectives on various issues.

A full recording of the interview is available on the Foster Report website for public access, under Industry Resources.

By Tom Tiernan ttiernan@fosterreport.com3335

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