July 1, 2001
L.A. Loves a Loophole
There's no getting around it...
With electric bills in Congress, and Moler bound for DOE, the Commission needs new vision.
Speaking in May at an informal press luncheon at the Washington International Energy Group in Washington, D.C., FERC Commissioner William L. Massey described the Federal Energy Regulatory Commission's role in an open-access electric industry as "nourishing" competition.
And with electric Order 888 under review at the federal appeals court in New York City, Massey saw little chance for reversal, claiming a "high degree of confidence [that] we'll do well."
About a week later, the FERC had quickly ok'd the merger of Duke Power and PanEnergy, squelching some fears that so-called "convergence" (gas-electric) mergers would find rough sledding at the Commission under the December 1996 electric merger policy statement Order 592, which focuses to a large degree on abuse of market power.
So what now? Does the FERC have anything left to do?
Perhaps with just that question in mind, the Commission convened a two-day technical conference on Thursday and Friday, May 29-30, looking to see whether it could rekindle some excitement in natural gas regulation (em the source of many past successes.
The gas conference, which drew an overflow crowd, was designed to conduct "a broad-ranging public discussion of the important issues facing the natural gas industry." The FERC added that the conference would help it to "establish its regulatory goals and priorities" for a gas industry still enamored with FERC's 1992 Order 636, which mandated open access for gas pipelines and helped make gas commodity markets more transparent. (See, Issues and Priorities for the Natural Gas Industry, FERC Docket No. PL97-1-000 supplemental notice organizing public conference, issued May 21, 1997.)
But the meeting also highlighted the FERC's uncertainty over what to do next.
Commissioner James Hoecker, widely seen as a likely candidate (with Massey) to succeed Elizabeth Moler as FERC chair, belied the lack of an obvious agenda when he invited the witnesses (including Enron's Ken Lay, and others) to think creatively: "Let's do some thinking outside the box. I'm not hearing much 'big picture' here."
Ironically, many witnesses advised the FERC that the best thing it could do for gas would be to follow through effectively on electric deregulation. Asked Massey: "Do all of you agree that electric deregulation is the most important question for gas?"
Meanwhile, the debate continued as to who would succeed Moler as FERC chair. Back at the WIEG luncheon, when asked about succession, Massey had graciously entertained the press with his quip, "I'm the best candidate." Later, however, when Moler advised that she would miss the second day of the two-day gas conference, the chair refused to play favorites between Hoecker and Massey. Faced with appointing a temporary chair for the Friday meeting, she chose Commissioner Vicki Bailey for the morning panel, and lame-duck member Donald Santa for the afternoon panels.
Said Moler: "The president has not given me any instructions on who should preside." t
(em B.W.R., L.B.
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