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The Federal Energy Regulatory Commission
Federal Energy Regulatory Commission
(FERC) is the United States federal agency that regulates the transmission and wholesale sale of electricity and natural gas in interstate commerce and regulates the transportation of oil by pipeline in interstate commerce. FERC also reviews proposals to build interstate natural gas pipelines, natural gas storage projects, and liquefied natural gas (LNG) terminals, in addition to licensing non-federal hydropower projects. FERC is composed of five commissioners who are nominated by the U.S. President and confirmed by the U.S. Senate. There may be no more than three commissioners of one political party serving on the commission at any given time.[1]

Contents

1 History

1.1 Federal Power Commission 1.2 Natural Gas Act
Natural Gas Act
of 1938 1.3 Birth of DOE; FPC Becomes FERC 1.4 Energy Policy Act of 2005

2 FERC's primary duties 3 Jurisdiction and authorities 4 Commissioners 5 Criticism 6 See also

6.1 Related legislation

7 References 8 Further reading 9 External links

History[edit] Federal Power Commission[edit] The Federal Power Commission (FPC), which preceded FERC, was established by Congress in 1920 to allow cabinet members to coordinate federal hydropower development. In 1935, the FPC was transformed into an independent regulatory agency with five members nominated by the President and confirmed by the Senate. The FPC was authorized to regulate both hydropower and interstate electricity. Natural Gas Act
Natural Gas Act
of 1938[edit] In 1938, the Natural Gas Act
Natural Gas Act
gave FPC jurisdiction over interstate natural gas pipelines and wholesale sales. In 1942, this jurisdiction was expanded to cover the licensing of more natural gas facilities. In 1954, the Supreme Court decision in Phillips Petroleum
Petroleum
Co. v. Wisconsin extended FPC jurisdiction over all wellhead sales of natural gas in interstate commerce. Birth of DOE; FPC Becomes FERC[edit] In response to the 1973 oil crisis, Congress passed the Department of Energy Organization Act in 1977, to consolidate various energy-related agencies into a Department of Energy. Congress insisted that a separate independent regulatory body be retained, and the FPC was renamed the Federal Energy Regulatory Commission
Federal Energy Regulatory Commission
(FERC), preserving its independent status within the Department.[2] FERC was also given added responsibility to hear appeals of DOE oil price control determinations and to conduct all "on the record" hearings for DOE.[3] As a result, DOE does not have any administrative law judges. As a further protection, when the Department of Energy proposes a rule, it must refer the proposal to FERC, and FERC can take over the proceeding if FERC determines that the rulemaking "may significantly affect" matters in its jurisdiction.[4] The DOE Act also transferred the regulation of interstate oil pipelines from the Interstate Commerce Commission to FERC.[5] However, the FERC lost some jurisdiction over the imports and exports of gas and electricity. In 1978, FERC was given additional responsibilities for harmonizing the regulation of wellhead gas sales in both the intrastate and interstate markets. FERC also administered a program to foster new cogeneration and small power production under the Public Utilities Regulatory Policy Act of 1978, which was passed as part of the National Energy Act of 1978. The National Energy Act included the Natural Gas Policy Act, which reduced the scope of federal price regulation, to bring greater competition to both the natural gas and electric industry. In 1989, Congress ended federal regulation of wellhead natural gas prices, with the passage of the Natural Gas Wellhead Decontrol Act of 1989.[6] Energy Policy Act of 2005[edit] The Energy Policy Act of 2005
Energy Policy Act of 2005
expanded FERC's authority to protect the reliability and cybersecurity of the bulk power system through the establishment and enforcement of mandatory standards, as well as greatly expanding FERC authority to impose civil penalties on entities that manipulate the electricity and natural gas markets. The Energy Policy Act of 2005 gave FERC additional responsibilities as outlined in FERC's top priorities and updated strategic plan. FERC's primary duties[edit] The responsibilities of FERC include the following:

Regulating the transmission and sale of natural gas for resale in interstate commerce; Regulating the transmission of oil by pipelines in interstate commerce; Regulating the transmission and wholesale sales of electricity in interstate commerce; Licensing and inspecting private, municipal, and state hydroelectric projects; Approving the siting of and abandonment of interstate natural gas facilities, including pipelines, storage and liquefied natural gas; Ensuring the reliability of high voltage interstate transmission system; Monitoring and investigating energy markets; Using civil penalties and other means against energy organizations and individuals who violate FERC rules in the energy markets; Overseeing environmental matters related to natural gas and hydroelectricity projects and major electricity policy initiatives; and Administering accounting and financial reporting regulations and regulating businesses of regulated companies.

Jurisdiction and authorities[edit] FERC is an independent regulatory agency within the United States Department of Energy. The President and Congress do not generally review FERC decisions, but the decisions are reviewable by the federal courts. FERC is self-funding, in that Congress sets its budget through annual and supplemental appropriations and FERC is authorized to raise revenue to reimburse the United States
United States
Treasury for its appropriations, through annual charges to the natural gas, oil, and electric industries it regulates.[7] FERC is independent of the Department of Energy because FERC activities "shall not be subject to further view by the Secretary [of Energy] or any officer or employee of the Department".[8] The Department of Energy can, however, participate in FERC proceedings as a third party. FERC is composed of up to five commissioners who are appointed by the President and confirmed by the Senate. The President appoints one of the commissioners to be the chairman of FERC, the administrative head of the agency. FERC is a bipartisan body; no more than three commissioners may be of the same political party. FERC has promoted voluntary formation of Regional Transmission Organizations (RTOs) and Independent System Operators (ISOs) to eliminate the potential for undue discrimination in access to the electric grid; regional and interregional transmission planning and cost allocation through the landmark Order No. 1000. FERC investigated the alleged manipulation of electricity market by Enron and other energy companies, and their role in the California electricity crisis. FERC has collected more than $6.3 billion from California electric market participants through settlements. Since passage of the Energy Policy Act of 2005, FERC has imposed, through settlements and orders, more than $1 billion in civil penalties and disgorgement of unjust profits to address violations of its anti-market manipulation and other rules. FERC regulates approximately 1,600 hydroelectric projects in the U.S. It is largely responsible for permitting construction of a large network of interstate natural gas pipelines. FERC also works closely with the United States
United States
Coast Guard to review the safety, security, and environmental impacts of proposed LNG terminals and associated shipping. Commissioners[edit] The Commissioners are:

Cheryl LaFleur
Cheryl LaFleur
(term expires June 30, 2019) Robert Powelson
Robert Powelson
(term expires June 30, 2020) Neil Chatterjee
Neil Chatterjee
(term expires June 30, 2021) Richard Glick
Richard Glick
(term expires June 30, 2022) Kevin J. McIntyre
Kevin J. McIntyre
(term expires June 30, 2023)

Criticism[edit] FERC has been subject to criticism and increasing acts of activism by people from communities affected by Commission decisions approving pipeline and related projects.[9] They contend that FERC "blithely greenlights too many pipelines, export terminals and other gas infrastructure"[9] and that FERC’s structure in which it recovers its annual operating costs directly from the entities it regulates creates bias in favor of the issuance of pipeline certificates.[10] Some of these critics have disrupted several regular open meetings of the Commission,[11] and they staged two, week-long blockades of the Commission’s headquarters in Washington, D.C., to make their points.[12] "Pipelines are facing unprecedented opposition," Commissioner LaFleur remarked to the National Press Club in a 2015 speech. "We have a situation here."[13][14] FERC’s decisions in these cases are often upheld by the courts. In a July 1, 2014, decision, No Gas Pipeline v. Federal Energy Regulatory Commission, the United States
United States
Court of Appeals for the District of Columbia Circuit (D.C. Circuit) said that pipeline applicants are not likely to pursue many certificates that are hopeless. "The fact that they generally succeed in choosing to expend their resources on applications that serve their own financial interests does not mean that an agency which recognizes merit in such applications is biased," the court said.[15] Others have directly disputed FERC’s critics by pointing out that "FERC is a creature of law. It follows a careful administrative path to regulate only a portion of natural gas such as interstate pipelines and LNG import and export terminals. That regulation includes extensive environmental review, driven by many federal laws enacted by Congress, signed by the president, and reviewed and upheld by the U.S. Supreme Court. If the agency were to adopt the path [suggested by these critics], FERC’s decisions would routinely be overturned by the federal courts."[16] The United States
United States
District Court for the District of Columbia also dismissed a case involving allegations of structural bias on the part of FERC. The plaintiffs contended that the Omnibus Budget Act of 1986 funding mechanism requires the Commission to recover its budget through proportional charges on regulated entities, therefore making FERC biased in favor of the industry from which it gets its funding. But in an order issued March 22, 2017, the court said the plain language of the statute indicates that FERC does not have control over its own budget. "The Commission’s budget cannot be increased by approving pipelines; rather, [the statute] requires the Commission to make adjustments to ‘eliminate any overrecovery or underrecovery.’ If Plaintiffs are unhappy with Congress’s chosen appropriations to the Commission…, Plaintiffs’ recourse lies with their legislative representatives."[10] However, the D.C. Circuit has ruled against Commission procedures, stating that in one case FERC failed to consider the cumulative environmental impact of four projects that had been separately proposed by the same pipeline. The D.C. Circuit held that the projects were not financially independent and were "a single pipeline" that was "linear and physically interdependent," so the cumulative environmental impacts should have been considered concurrently.[17] Subsequently, in a separate decision, the D.C. Circuit clarified that the "critical" factor was that all of the pipeline’s projects were either under construction or pending before FERC for environmental review at the same time.[18] This guidance has allowed FERC to address additional claims of improper segmentation.[19] In New Jersey, the FERC approval of the PennEast Pipeline
PennEast Pipeline
was met with widespread criticism by environmental groups who called the decision highly partisan. "FERC has once again demonstrated its tremendous bias for, and partnership with, the pipeline industry," said Maya van Rossum, leader of the Delaware Riverkeeper Network. Doug O'Malley, president of Environment New Jersey, called the FERC approval of the pipeline a "disaster." David Pringle, state campaign director of Clean Water Action and 2018 Congressional candidate, suggested the FERC was serving a partisan interest over the interests of the people of New Jersey, suggesting "The FERC needs to remember it works for the people of the United States
United States
not PennEast." [20] FERC's leaders have stressed many times since the onset of the increased activism that the proper way to oppose a proposed new infrastructure project is by participating in the related proceeding by submitting comments and participating in public comment sessions, site visits and scoping meetings, since FERC decisions can be appealed up to the Supreme Court. Nonetheless, many continue to criticize FERC for appearing to serve the interests of fossil fuel companies over the public.[21] See also[edit]

Custody transfer United States
United States
energy law High-voltage direct current North American Electric Reliability Corporation
North American Electric Reliability Corporation
(NERC)

Related legislation[edit]

Hydropower Regulatory Efficiency Act of 2013 (H.R. 267; 113th Congress) – proposed law that will alter the regulations the FERC is charged with enforcing Collinsville Renewable Energy Promotion Act (H.R. 316;113th Congress) – proposed law ordering the FERC to reinstate two project licenses for a town in Connecticut Title 18 of the Code of Federal Regulations

References[edit]

^ Cama, Timothy (June 29, 2017). "Trump taps Dem Senate aide for energy commission". The Hill. Retrieved 3 November 2017.  ^ 42 U.S.C. § 7134 ^ 42 U.S.C. § 7172(d). ^ 42 U.S.C. § 7174. ^ 42 U.S.C. §7172(b) (since repealed) ^ http://www.gpo.gov/fdsys/pkg/STATUTE-103/pdf/STATUTE-103-Pg157.pdf ^ "About FERC". Retrieved 9 Apr 2014.  ^ 42 U.S.C. § 7172(g) ^ a b FERC faces heightened scrutiny as gas projects proliferate, Hannah Northey, E&E, November 3, 2014. ^ a b Delaware Riverkeepers Network v. Federal Energy Regulatory Commission, No. 16-CU-416 (D. D.C. March 22, 2017). ^ e.g., see, RTO Insider, Protesters Interrupt FERC Open Meeting, Michael Brooks, 1/26/2015. ^ Meet the People Making Life a Little More Difficult for FERC this Week, RTO Insider-May 26, 2015. ^ FERC Commissioner Cheryl LaFleur, National Press Club. Video Transcript ^ Zullo, Robert (December 22, 2017). "New FERC chief:Pipeline permit policies to be reviewed". Richmond, Virginia: Richmond Times-Dispatch. p. A5. FERC faces several lawsuits over its approval of pipeline projects, which critics say amounts to a rubber stamp that, in turn confers handsome rates of return and powers of eminent domain to seize private property without adequately vetting whether they serve true public purpose.  ^ NO GAS PIPELINE, Petitioner v. FEDERAL ENERGY REGULATORY COMMISSION, Respondent Statoil Natural Gas, LLC, et al., Intervenors (Nos. 12–1470, 12–1474, 12–1475). Decided: July 1, 2014 ^ FERC Protests Make No Sense, Kennedy Maize, Powermag.com, May 24, 2016. ^ See, Delaware Riverkeeper Network v. FERC, 13-1015, U.S. Court of Appeals for the D.C. Circuit. ^ Minisink Residents for Environmental Preservation and Safety et al v. FERC (No. 12-1481) ^ Transcontinental Gas Pipe Line Company, LLC, 149 FERC ¶ 61,258 (2014). ^ "Activists critical of federal hearing on PennEast pipeline," App (USA TODAY), 8/17/16: https://www.app.com/story/news/local/land-environment/2016/08/17/activists-critical-federal-hearing-penneast-pipeline/88930848/ ^ Protesters showing up at FERC Commissioners' homes is simply wrong, Glen Boshart, S&P Global Market Intelligence, February 29, 2016.

Further reading[edit]

Gies, Erica. Making the Consumer an Active Participant in the Grid, The New York Times, November 29, 2010. Discusses distributed generation and the U.S. Federal Energy Regulatory Commission.

External links[edit]

Official site

Electricity LNG Terminals Natural Gas Hydroelectric

Federal Energy Regulatory Commission
Federal Energy Regulatory Commission
in the Federal Register

v t e

Agencies under the United States
United States
Department of Energy

Headquarters: James V. Forrestal Building

Rick Perry, Secretary of Energy Dan Brouillette, Deputy Secretary of Energy

Deputy Secretary of Energy

Office of Intelligence and Counterintelligence Energy Information Administration ARPA-E

Under Secretary of Energy for Energy and Environment

Office of Electricity Delivery and Energy Reliability Office of Energy Efficiency and Renewable Energy

Under Secretary of Energy for Nuclear Security

National Nuclear Security Administration

Under Secretary of Energy for Science

Office of Science

OSTI

Assistant Secretary of Energy for Nuclear Energy

Office of Nuclear Energy

Power Marketing Administration

Bonneville Power Administration Southeastern Power Administration Southwestern Power Administration Western Area Power Administration

National Laboratory System

Ames Argonne

NBL CNM APS ATLAS EMC

Berkeley

ALS MF NCEM NERSCC ESN JGI

Brookhaven

AGS CFN NSLS NSLS II RHIC

Fermilab

TeV

Idaho

RESL

JLab Livermore

NARAC NIF

Los Alamos

DARHTF

NETL

Albany

NREL Oak Ridge

SNS CNMS HFIR NCCS

Pacific Northwest

EMSL

PPPL

NSTX

TFTR SRNL Sandia

Z

SLAC

SSRL

Energy Department Facilities and Reservations

Fernald NLO Hanford K-25 Kansas City Plant Nevada Test Site

Area 19 Area 20

NHHOR Pantex Rocky Flats SSFL

ETEC SRE

SRS SPR WIPP Y-12 Yucca Mountain

Independent Agency

Federal Energy Regulatory Commission

v t e

United States
United States
government agencies involved in environmental science

Environmental Protection Agency National Aeronautics and Space Administration Global Change Research Program Smithsonian Institution National Science Foundation

Department of the Interior

National Park Service United States
United States
Fish and Wildlife Service Bureau of Indian Affairs Bureau of Land Management Bureau of Ocean Energy Management, Regulation and Enforcement Bureau of Reclamation Office of Surface Mining, Reclamation, and Enforcement United States
United States
Geological Survey Office of Insular Affairs

Department of Commerce

National Oceanic and Atmospheric Administration National Weather Service National Ocean Service National Geodetic Survey National Marine Fisheries Service Office of Oceanic and Atmospheric Research

Department of Energy

Office of Science Office of Energy Efficiency and Renewable Energy National Laboratories Office of Environmental Management

Department of Agriculture

Farm Service Agency Foreign Agricultural Service United States
United States
Forest Service Natural Resources Conservation Service National Water and Climate Center Rural Utilities Service Food and Nutrition Service Animal and Plant Health Inspection Service Agricultural Research Service Agricultural Stabilization and Conservation Service

Department of Homeland Security

United States
United States
Coast Guard Directorate for Science and Technology

Department of Health and Human Services

National Institute of Environmental Health Sciences

Department of Defense

Office of Naval Research Air Force Research Laboratory United States
United States
Army Research, Development and Engineering Command

v t e

Electricity delivery

Concepts

Availability factor Automatic Generation Control Backfeeding Base load Black start Capacity factor Demand factor Droop speed control Economic dispatch Demand management EROEI Fault Home energy storage Grid storage Intermittency Load factor Load following Nameplate capacity Peak demand Power quality Power-flow study Repowering Utility frequency Variability

Sources

Nonrenewable

Coal Fossil fuel power station Natural gas Petroleum Nuclear Oil shale

Renewable

Biomass Biofuel Geothermal Hydro Marine

Current Osmotic Thermal Tidal Wave

Solar Wind

Generation

AC power Cogeneration Combined cycle Cooling tower Induction generator Micro CHP Microgeneration Rankine cycle Three-phase electric power Virtual power plant

Transmission and distribution

Blackout (Rolling blackout) Brownout Demand response Distributed generation Dynamic demand Electric power distribution Electric power system Electric power transmission Electrical grid High-voltage direct current Load management Mains electricity by country Power line Power station Power storage Pumped hydro Smart grid Substation Super grid Transformer Transmission system operator
Transmission system operator
(TSO) Transmission tower Utility pole

Protective devices

Arc-fault circuit interrupter Earth leakage circuit breaker Residual-current device
Residual-current device
(GFI) Power-system protection Protective relay Digital protective relay Sulfur hexafluoride circuit breaker

Economics and policies

Carbon offset Cost of electricity by source Ecotax Energy subsidies Feed-in tariff Fossil-fuel phase-out Net metering Pigovian tax Renewable Energy Certificates Renewable energy
Renewable energy
payments Renewable energy
Renewable energy
policy Spark/Dark/Quark/Bark spread

Categories Electric power distribution Electricity economics Power station
Power station
technology Portals Energy Renewable energy Sustainable development

v t e

List of public utilities commissions in North America

Canada

Alberta British Columbia Manitoba New Brunswick Newfoundland and Labrador Northwest Territories Nova Scotia Nunavut Ontario Prince Edward Island Quebec Saskatchewan Yukon Territory

Caribbean

Anguilla Antigua and Barbuda Bahamas Barbados Bermuda British Virgin Islands Cayman Islands Dominica Dominican Republic Grenada Jamaica Montserrat Puerto Rico Saint Kitts and Nevis Saint Lucia Saint Vincent and the Grenadines Sint Maarten Trinidad and Tobago Turks and Caicos Islands U.S. Virgin Islands

Oceania

American Samoa Commonwealth of the Northern Marianas Guam

United States

Federal

DOE FERC FCC

Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia

PUC WMATC

Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas

PUC RRC

Utah Vermont Virginia Washington West Virginia

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