From: The Hill/Congress Blog
By Thomas S. Popik and William R. Graham
With a Senate vote on two nominees for commissioners of the Federal Energy Regulatory Commission (FERC) pending, there is unprecedented attention on this obscure regulator of interstate pipelines and electricity transmission. In 2005, Congress granted FERC additional authority to regulate electric grid reliability and security, but too often FERC has accommodated industry rather than enforce strict standards.
Both FERC nominees, Cheryl LaFleur and Norman Bay, have long tenures as commissioner and director of Enforcement, respectively. Before a confirmation vote, Senators should examine FERC’s weak regulatory record and determine whether leadership and legislative fixes are necessary.
Prior to the 2003 Northeast Blackout which affected 50 million people, electric grid reliability and security were unregulated. An industry trade association had set voluntary standards but compliance was spotty. After the Northeast Blackout, a special U.S.-Canada task force identified the voluntary standards system as a prime cause. In response, Congress designed a hybrid regulatory system, where a private successor to the trade association, the North American Electric Reliability Corporation (NERC), would set mandatory standards. FERC would have authority to request, review, and approve, but not change, NERC’s standards.