By Naureen S. Malik on 11/8/2020
(Bloomberg) –President Donald Trump demoted the top U.S. energy regulator as his prospects to secure a second presidential term dimmed.
The White House replaced Neil Chatterjee as chairman of the Federal Energy Regulatory Commission, a position he’s held for past two years. Fellow Republican Commissioner James Danly will now lead the agency, according to a statement late Thursday. Chatterjee tweeted that he plans to serve out his term as a commissioner through June.
Chatterjee, former energy advisor to Senate Majority Leader Mitch McConnell, has historically promoted policies that favored coal, a key industry in his native Kentucky. But more recently, he’s taken a different tack, embracing decarbonization even as the Trump administration has worked to protect fossil fuels. In recent months, Chatterjee effectively endorsed carbon pricing in wholesale electricity markets and made it easier for renewables and energy storage to compete in those markets. Danly opposed both initiatives.
The moves “may have been viewed by the White House as anti-coal as they will likely hasten the resource’s exit” from the generation mix, Josh Price, an analyst for for Height Securities LLC, said in a report Friday.
Chatterjee said Friday he didn’t know why he was demoted, but if his recent policy actions played a role, they were “completely worth it.”
“The reality is that there will be no Green New Deal, no $2 trillion in clean energy, there will be no national carbon tax,” Chatterjee said in an interview. Given the likely gridlock in Congress, the commission will play an outsized role in energy policy, he said.
“I may be the most significant player in the energy transition, climate debate in the country and possibly the planet since the world follows the U.S.’s lead,” Chatterjee added.
Should Trump win re-election, Danly’s elevation to chairman indicates that the agency’s policy statement on carbon pricing may never be finalized, ClearView Energy Partners LLC said in a note Friday.
If Democratic nominee Joe Biden prevails in the race for the White House, the commission will again see a reshuffle, with Democratic Commissioner Richard Glick likely to be named chairman. But in that case, the Republican-controlled Senate will likely use the remainder of its term to fill the commission’s two open seats in a bid to retain party control of the agency under a Biden administration, according to Price.
The strategy would seek “to essentially neuter” Democrats from pursuing climate-friendly rulemaking, which could delay permitting for natural gas pipeline and export projects, said Price.
Chatterjee said he plans to complete his term and potentially stay through 2021.
“I am perfectly positioned to be the broker between a Biden Administration and Senate Republican majority to make meaningful progress on the clean energy transition,” he said.
Chatterjee was named interim chairman in 2017 and has steadily held the position since October 2018. The agency hasn’t had a full slate of five commissioners for most of the Trump Administration.
Appeared on www.worldoil.com