By Michael Kuser

BOSTON — FERC Commissioner Neil Chatterjee promised Thursday that the commission will not become part of what he called the “hyper-politicized” policymaking process in D.C.

Chatterjee made his remarks at a meeting of ISO-NE’s Consumer Liaison Group on Dec. 7, which also included a panel on energy storage and a discussion of energy and capacity prices.

Chatterjee is among the four commissioners who have joined FERC since August. He spoke to ISO-NE hours after the swearing in of Kevin McIntyre, who replaced him as chairman. (See related story, McIntyre Takes FERC Chair; Wins Delay on NOPR.)

A former energy policy adviser to Senate Majority Leader Mitch McConnell (R-Ky.), Chatterjee said it’s increasingly difficult to get any policy change through the legislative process, particularly regarding energy.

“Increasingly, energy policy is being made by provisions in the tax code, measures in big, year-end spending bills, or more so, more and more policy decisions are being made at agencies throughout the federal government,” Chatterjee said. “As someone who now works in the executive branch and may be the short-term beneficiary of that increased authority in the executive branch, I don’t think it’s good for democracy or good for America.”

Energy policy needs to be made in Congress to have lasting impact and avoid regulatory uncertainty, he said.

“For instance, in the EPA, the mission of the EPA today under Administrator [Scott] Pruitt is the polar opposite of what Administrators [Gina] McCarthy and [Lisa] Jackson had under the prior administration,” Chatterjee said. “There’s been a wholesale shift in direction, and that really leads to regulatory instability for consumers, for folks in the business of power generation and distribution. It creates just so much lack of clarity and uncertainty.

“One of the things I’m proud of is FERC provides stability. Not only is the nature of the work at FERC inherently technical, not political, but also because you have the bipartisan board structure — where the president’s party never has more than three members — you’re never going to lurch dramatically in a new direction. So even though there’s new leadership at the commission today, and we may not go in the exact same direction as the prior leadership was going, we’re not going to go in a dramatically different direction than the prior leadership.”

Republicans now hold a 3-2 edge on the panel. Because of the commission’s turnover and “what is perceived to be a political exercise” with the Department of Energy’s call for price supports for coal and nuclear plants, Chatterjee said, he’s heard concern that the commission will become more political. (See FERC’s Independence to be Tested by DOE NOPR.)

“I have to tell you, that’s not going to happen,” he insisted. “If you look at the composition of the five of us who sit at the commission, you have Commissioner [Cheryl] LaFleur, who has seven years’ experience on the commission but also decades in the energy space. She’s a leader we all respect and look up to and she will provide that stability.

“Kevin McIntyre, who was sworn in as chairman today, is one of the top energy lawyers on the planet, let alone in the country. He’s a serious, thoughtful leader who’s got a great temperament who will provide that steady leadership.

“Both Commissioner [Richard] Glick and I come from the Senate, and the thing about the Senate … is you work for the whole country … and see things holistically. Commissioner [Robert] Powelson had been chair of a state commission and brings that very valuable state experience … and state commissioners are very attuned to the interests of consumers.”

Chatterjee said one reason he wanted a seat on the commission was to encourage new technologies such as energy storage, which he said could help improve grid resilience.

“We are currently working through a storage rule at the commission that will … remove barriers to competition and access for storage, and enable storage to be properly compensated for the value it provides,” Chatterjee said.

Working on Energy Storage

The Consumer Liaison Group meeting included a panel on energy storage moderated by Robert Espindola, energy systems program manager for Acushnet. On Thursday, his company won a $700,000 grant from Massachusetts for a storage project at the company’s Titleist golf ball factory in New Bedford. (See Massachusetts Awards $20M in Energy Storage Grants.)

Also on the panel were Christopher Parent, the RTO’s director of market development; Massachusetts Department of Energy Resources Commissioner Judith Judson; Lewis Milford, president of Clean Energy Group, a nonprofit in Montpelier, Vt.; and Ted Ko, director of policy at Stem, which pairs artificial intelligence with storage to automate cost savings.

Judson had appeared earlier that day at a ceremony marking the storage grants.

In July, DOER adopted a 2020 target of 200 MWh energy storage for the three electric distribution companies in the state. Judson said that the short-term target is line with the 2025 goal of 600 MW laid out in the state’s State of Charge report last year.

As of Dec. 1, the RTO had 400 MW of energy storage in the interconnection queue, or about 3% of all generation applying to interconnect, Parent said. (See ISO-NE Preparing for Energy Storage Growth.)

ISO-NE Prepares for FCA 12

ISO-NE Vice President for External Affairs and Corporate Communications Anne George, who presented an update on the RTO’s activities, said it projects an energy market value of $3.9 billion for 2017. The value has been declining for a decade and is down more than two-thirds from the $12.1 billion posted in 2008, she said.

“But we also see the capacity market is ticking upwards,” George said. “That’s really because back in 2013 we saw … a large chunk of the resources retired in the region, and when they did that, in the eighth Forward Capacity Auction we saw prices rise. That’s how markets behave.” Prices continued to rise in the succeeding FCA, then dropped in FCA 10 and FCA 11, she said.

“So, you’ll see some increase in the capacity market portion of wholesale market costs over the next couple of years, but then you’ll start to see it level off and come back down,” George said. “Right now, we are in a surplus situation.”

FCA 12 is scheduled to take place for February 2018, covering the June 1, 2021, to May 31, 2022, capacity commitment period. In November, the RTO submitted a pre-FCA informational filing with FERC for review, which included all FCA-related calculations and determinations.