Senate confirms Willie Phillips to FERC, giving Democrats a majority

The U.S. Senate confirmed Willie Phillips Jr. to the Federal Energy Regulatory Commission on November 16, giving Democrats a 3–2 majority in a key federal agency facing major policy decisions on transmission grid development, natural-gas pipelines and renewable energy’s role in interstate energy markets.

Phillips, a longtime energy industry attorney and chair of Washington, D.C.’s Public Service Commission, was unanimously confirmed on Monday, filling the fifth seat on the five-member commission that was left vacant by Neil Chatterjee, a Republican.

In his confirmation hearing last month before the U.S. Senate Energy and Natural Resources Committee, Phillips said he would seek to balance sustainability, affordability and reliability in weighing decisions that come before FERC. ​“My approach would be to seek balance in everything we do,” he said.

Phillips’ confirmation was welcomed by clean energy groups. They had opposed many of the decisions FERC made under a Republican majority during the Trump administration. 

“We look forward to working with Commissioner Phillips to ensure that America’s wholesale electricity markets deliver the benefits of low-cost clean advanced energy resources to consumers, and that transmission planning, cost allocation, and generator interconnection practices ensure that the clean energy resources consumers are demanding can access the transmission grid and markets,” said Jeff Dennis, managing director and general counsel at Advanced Energy Economy, in a prepared statement.

Other groups expressed relief that Phillips’ confirmation will mean that FERC once again has the full complement of commissioners necessary to make decisions. 

Since Chatterjee’s departure in June, FERC’s two Republicans and two Democrats have been unable to reach a majority decision on two key issues, yielding deadlocks that allowed policies to move ahead without challenge or amendment by the commission.

The first deadlock allowed mid-Atlantic grid operator PJM to move ahead with a plan to scale back a rule imposed by FERC’s then-Republican majority in 2019. The rule would have restricted the competitiveness of clean energy resources in the grid operator’s 13-state capacity market. PJM’s move was largely welcomed by clean energy groups.

The second deadlock at FERC allowed a plan by Southeastern U.S. utilities to create an energy-trading market to go through. Some clean energy groups oppose the Southeast Energy Exchange Market on the grounds that it lacks the more competitive and open structures of the regional transmission markets that serve much of the rest of the country.

FERC’s new five-member commission could revisit these and other deadlocked decisions in the coming months.

“This is a critical moment for our energy transition, and we’re pleased to see that FERC will finally be operating at full capacity to address the transmission and power market reforms necessary to unlock America’s growing renewable energy economy,” said Gregory Wetstone, CEO of the American Council on Renewable Energy, in a statement.

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Here’s an excerpt from our article about Phillips from September, when President Biden nominated him.

News of Phillips’ nomination drew mixed responses from parties engaged in the wide-ranging set of interstate energy policies under FERC’s authority.

Some environmental groups singled out Phillips’ actions as a utility regulator, including his early support of a merger of Washington, D.C.–area utility Potomac Electric Power (Pepco) and utility holding company Exelon, as warning signs for those seeking more community and consumer protections from the agency. Drew Hudson, senior national organizer at advocacy group Friends of the Earth, called Phillips​“a gift to corporate utilities and the fossil fuel industry” in a Friday statement.

Hudson did say that nominating Phillips, who is Black, to serve on FERC would bring important diversity to the agency. But he cited a letter from more than 460 environmental and community groups proposing alternative nominees of color who would better​“champion environmental and energy justice.”

Rob Rains, an analyst at the research firm Washington Analysis, wrote in an email that Phillips is​“unlikely to ruffle too many utility…feathers,” given his moderate stances as a utility regulator and his long professional experience in the utility industry, including his work for the North American Electric Reliability Corporation.

On the other hand, Phillips has​“a long history of actively supporting emerging technologies for the electric grid and will likely be a voice of support for incremental expansion of distributed energy systems as part of the regional wholesale power markets,” Rains wrote.

Phillips worked on implementing Washington, D.C.’s mandate to reach 100 percent carbon-free energy by 2050. During a FERC technical conference in April, he highlighted the role that distributed energy resources such as electric school buses could play on the grid, while also emphasizing the importance of managing their impact on utility distribution grids.

Clean energy industry groups were broadly supportive of Phillips’ nomination, citing his role as a key vote for the range of decisions before FERC.

“Chairman Phillips’ deep legal understanding of the issues at stake and clear recognition of the benefits that renewable energy provides our nation’s communities are encouraging,” Gregory Wetstone, CEO of the American Council on Renewable Energy trade group, said in a Friday statement.

“FERC is a key part of our clean energy transformation, and we will need a full commission and a strong leader like Chairman Phillips to realize President Biden’s Build Back Better vision,” Abigail Ross Hopper, CEO of the Solar Energy Industries Association, said in a Thursday statement.

What’s ahead for FERC

Chatterjee, who chaired FERC under President Trump, helped architect a slew of policies that have received some praise from clean energy advocates — but more criticism.

A number of the most critiqued policies were passed over the objection of Richard Glick, who was appointed FERC chair by Biden in February. Glick served as the agency’s sole Democrat from early 2019 until late last year, when Democrat Allison Clements and Republican Mark Christie were confirmed to join Glick, Chatterjee and Republican James Danly at FERC.

Among the decisions Glick opposed was a series of orders restricting the ability of state-supported clean energy resources to participate in wholesale capacity markets in New York state and the broader Eastern U.S. The best-known of these is the minimum offer price rule decision that has since been challenged by mid-Atlantic grid operator PJM, which critics say could prevent much of the clean energy called for in policies in states ranging from Illinois to New Jersey from competing in PJM’s capacity market.

FERC’s Republican majority also approved several natural gas projects over Glick’s objections that they failed to take environmental and climate change impacts into account. Several of these decisions have been successfully challenged in federal courts.

A June ruling from the D.C. Circuit Court of Appeals, regarding a project accused by opponents of being a case of self-dealing on the part of the natural gas companies involved, orders FERC to review its policies to determine whether new pipelines are needed. Glick and fellow Democrat Clements have refocused FERC’s efforts to take climate change and environmental justice into account in its decisions, including those involving pipelines and natural gas infrastructure.

At the same time, Glick has launched an effort to consider reforms to how FERC regulates interstate transmission permitting and cost allocation, with an eye to speeding the buildout of power lines to enable the massive growth in wind and solar deployments needed to meet the Biden administration’s goal of eliminating carbon emissions from the electricity sector by 2035.

Clean energy advocacy groups have for years called on FERC to take action to allow transmission lines to be built more quickly to meet these needs, including some calls to use federal authority to overcome local public and private stakeholder objections to siting these projects. Other proposals on the table could provide financial incentives to transmission projects deemed important to expand clean energy growth or deploy technologies to make existing power lines more efficient.

FERC will also be making decisions on policies championed by Chatterjee that have won praise from clean energy groups but face an uncertain prospect under the agency’s current 2–2 party split. Those include a decision last year opening the door for the country’s interstate grid operators to integrate carbon pricing into their energy markets. That decision may have played a role in Trump demoting Chatterjee from his role as FERC chair late last year.

Chatterjee also pushed last year’s passage of FERC Order 2222, which orders grid operators to open their markets to distributed energy resources including rooftop solar, behind-the-meter batteries, electric vehicle chargers and grid-responsive loads. New York’s and California’s grid operators have submitted plans to comply with Order 2222 that have drawn some criticism from clean energy groups; other grid operators are expected to propose their own plans over the coming 12 months.