FERC in Focus: Will the agency maintain its independence under Trump 2.0?

President Donald Trump is making unprecedented moves to assert control over independent agencies like the Federal Energy Regulatory Commission, and former commissioners, experts and agency observers say they are watching several key areas to gauge whether the commission will remain independent.

The White House has already moved to favor fossil fuel assets over renewable energy, require agencies to clear decisions with the Office of Management and Budget and include sunset provisions in new regulations. Trump has also shown a willingness to fire or try to remove regulators that run afoul of his preferences, such as he has done with the Nuclear Regulatory Commission and the Federal Reserve.

With two Republican nominees preparing to fill empty seats at FERC, the agency is poised for a shift that could lead to more direct White House influence over the independent agency’s policymaking, said Tyson Slocum, director of Public Citizen’s Energy Program.

“My guess is you're going to see a pretty tight alignment between FERC’s priorities and the priorities of the White House, and I think that will significantly erode FERC’s historic bipartisan independence and move FERC more into being an arm of the White House,” he said.

Even if the agency maintains its independence, the loss of experts and staff to the administration’s aggressive cuts to the federal workforce could hamper its work, some say.

“The agency is already chronically understaffed and so if you really see additional attrition, it's going to be much harder for the agency to do complex, hard stuff on top of its bread-and-butter responsibilities and proceedings that really do take up a lot of time,” according to Matt Christiansen, a Wilson Sonsini attorney and former FERC general counsel.

New commissioners, new priorities

So far, FERC does not appear to have changed much since Trump became president in January, according to agency observers. FERC Chairman David Rosner, a Democrat Trump selected to head the agency last month, said the commission is working independently.

“FERC continues to execute our mission to enable reliable and affordable energy for all Americans by implementing the laws passed by Congress, making decisions fairly, efficiently, and independently, and considering the views put forth by all parties,” Rosner said in an email.

However, new faces on the commission could bring about a shift.

Immediately after Trump was inaugurated in late January, he elevated Republican Commissioner Mark Christie to be the agency’s chairman. After Trump declined to ask Christie to serve a second term, he left the agency on Aug. 8.

Earlier this year, Trump named Laura Swett, an energy attorney and former FERC staffer, and David LaCerte, an official with the U.S. Office of Personnel Management, to fill the empty seats.

LaCerte does not appear to have any background in energy. He is listed as a contributor to the Heritage Foundation’s Project 2025, the conservative blueprint for “dismantling the administrative state” that Trump disowned as a candidate but has since moved to implement.

The nominations must be approved by the Senate Energy and Natural Resources Committee — which was set to hold a confirmation hearing on the nominees on Sept. 4 — and the full Senate, a process that may not be completed until late this year.

Once FERC’s five seats are filled, agency observers expect Trump will name either Swett or LaCerte as chairman, which could lead to changes for the independent agency.

Keeping thermal power plants running

One of the Trump administration’s top energy goals is keeping coal- and gas-fired power plants from retiring, especially when it is challenging to build new gas-fired power plants given siting and permitting hurdles and the time it takes to procure equipment, according to Josh Price, a director on the energy team at Capstone, a research firm.

The U.S. Department of Energy has helped in that goal by issuing “emergency” orders to prevent two power plants in Michigan and Pennsylvania from retiring, Price said, adding that FERC could join the effort after the pending nominees join the agency. The DOE has framed the move as one necessary for reliability, but it is expected to cost utilities more. The owner of one Michigan coal plant said it spent $29 million in just over a month complying with an order to keep it running.

Price said he expects FERC will issue Federal Power Act section 206 orders finding that some markets — maybe all markets — are “unjust and unreasonable” and should be changed because they don't adequately provide value to the reliability benefits offered by nuclear, gas- and coal-fired power plants.

“It's prioritizing existing, dispatchable resources, which runs counter to putting downward pressure on prices, which is the administration’s stated goal,” Price said. “But I view that as more rhetoric than a real desire.”

FERC could also favor dispatchable generation in interconnection queues, according to Price. The commission, for example, has approved temporary fast-track interconnection reviews for the PJM Interconnection, the Midcontinent Independent System Operator and the Southwest Power Pool that generally favor dispatchable generation.

“One of the things I'd be interested to see is … to what extent does FERC attempt to make prioritization of dispatchable resources in the queue permanent?” Price asked.

Slocum echoed Price’s assessment.

“I think you're going to see a much more aggressive push to tweak market structures and market rules to prioritize primarily natural gas generation at the expense of wind and solar,” he said.

Further, FERC’s current commissioners appear to generally support adding gas infrastructure in the U.S., according to Slocum. FERC, for example, in June approved a petition for a waiver sought by the Interstate Natural Gas Association of America without questioning whether Trump’s “energy emergency” — one of INGAA’s justifications for the need for a waiver — is valid, he said.

“There seems to be a consensus agreement at FERC right now that the energy system is in crisis, that renewables are contributing to that crisis, and that we need to take extraordinary steps to promote primarily natural gas generation and pipelines to support natural gas generation as a viable solution to America's energy challenges,” Slocum said.

Executive orders test FERC’s independence

It’s unclear how much influence the White House will have over FERC, according to Neil Chatterjee, a former FERC chairman nominated by Trump and chief government affairs officer at Palmetto.

One possible scenario is that the White House could start requiring FERC decisions to be vetted by the Office of Information and Regulatory Affairs and the Office of Management and Budget, he said, which would turn FERC’s chair and commissioners “more into administration staffers than independent commissioners.”

While FERC chairs typically communicate with the White House, there has never been direct oversight of the agency, according to Chatterjee.

“I had full independence to make decisions as I saw fit, that I thought were just and reasonable and will withstand legal scrutiny,” he said. “I never had to clear anything with anybody.”

One of the key barometers for measuring FERC’s independence will be how the agency responds to an executive order that directs FERC, the Environmental Protection Agency and other agencies to add sunset provisions to their energy-related regulations so they would expire within five years, Christiansen said.

Trump ordered the sunset provisions to be in place by Sept. 30. For FERC, the directive covers regulations under the Federal Power Act, the Natural Gas Act and the Power Plant and Industrial Fuel Use Act.

It appears that it may be impossible to comply with the letter of the executive order and the requirements of the Administrative Procedure Act, which sets the rules for how federal agencies develop and issue regulations, Christiansen said.

If FERC goes through a notice of comment period for regulations the agency wants to continue past the five-year deadline — as outlined in the executive order — that process “would take forever and require a lot of manpower, and it also would leave a lot of regulated entities in limbo,” said Richard Glick, a principal at GQS New Energy Strategies and former FERC chair.

Another concern would be other executive orders that direct independent agencies to clear major activities with OMB, according to Glick. The OMB reports directly to the president and is headed by Russell Vought, a key architect of Project 2025 who has advanced a maximalist view of presidential power.

“FERC has a very long history of being truly independent, meaning that the administration, no matter who's in charge, doesn't tell FERC or the commissioners how to vote or what to do on various issues,” Glick said.

Following typical procedure, FERC hasn’t shared documents outside the agency before commissioners vote on them since Christie became commission chairman, he said during a media briefing on July 24.

Another issue that could affect FERC’s independence is the threat of commissioners being fired as has happened at other independent agencies such as the Nuclear Regulatory Commission in June, Glick said.

In an unprecedented move, Trump on Aug. 25 released a letter saying he was firing Lisa Cook, a board member of the Federal Reserve, an independent agency that runs the U.S. central banking system.

FERC’s ‘brain drain’

Meanwhile, FERC, which is under a hiring freeze, has been losing key staff since Trump was elected, according to agency observers.

“They’ve already had a fair bit of brain drain — significant losses in the General Counsel's Office and the policy office — so the agency is increasingly less equipped to execute on a policy agenda, and just even implementing core, nuts and bolts stuff,” said Devin Hartman, director of energy and environmental policy at the R Street Institute.

FERC’s headcount is expected to fall by 9% by the end of its fiscal year, Christie said during the media briefing in mid-April. FERC had a staff of about 1,500 people as of December. The agency didn’t respond to requests for its current headcount.

At the same time FERC is going through organizational changes. The agency is finalizing the details of a reorganization plan required by the Office of Personnel Management and OMB, according to Celeste Miller, FERC’s acting director of media relations.

The reorganization includes changes to FERC’s Office of Policy and Innovation, E&E News reported in early August.