On April 14, 2020, Federal Energy Regulatory Commission (FERC) Chairman Neil Chatterjee addressed FERC's response to the COVID-19 pandemic on FERC's Open Access podcast. Chairman Chatterjee highlighted FERC's ongoing focus on protecting the health and safety of FERC staff and those in the energy industry who are working to keep the lights on. He also summarized certain recent FERC actions to provide regulatory guidance and certainty to the energy industry on reliability and security matters during this challenging time.
Chairman Chatterjee first noted that “ensuring the reliability and security of our nation's vital energy infrastructure is critical and is [FERC's] top priority.” With that goal in mind, FERC continues to “do all [it] can to lift regulatory burdens and uncertainty” to allow regulated entities to focus on “critical frontline efforts.” He described his appointment of long-time FERC staff member Caroline Wozniak as “Coronavirus Liaison” and principal point of contact for all industry inquiries regarding the impact of COVID-19 preparations and responses on FERC-jurisdictional activities. He then referenced FERC's Policy Statement, issued April 2, 2020, regarding FERC's intent to prioritize the processing of “filings made for the purpose of assuring the business continuity of energy infrastructure,” and commitment to “expeditiously review and act on requests for relief, including, but not limited to, requests for cost recovery necessary to assure their business continuity.”
Chairman Chatterjee then discussed his concern regarding the financial impact of COVID-19 on the energy industry, noting the “need to make sure that we don't have liquidity concerns once [the pandemic] emergency is over,” and described his April 7, 2020, joint letter with National Association of Regulatory Utility Commissioners President Brandon Presley to Federal Reserve Chair Jerome Powell “supporting the extension of Commercial Paper Funding Facility purchasing to [certain] commercial paper programs” to facilitate utilities' “ready access to short-term debt [needed to] support both the financial stability of those companies and their ability to continue to support the country's essential infrastructure.”
Other FERC actions Chairman Chatterjee described included: (1) “prioritizing the efficient processing of requests for waiver and other requests for relief” through increased delegation of authority to certain program office directors; (2) increasing flexibility on deadlines for certain required filings; (3) waiving tariff provisions that require in-person meetings; (4) suspending new enforcement audits until July 31, 2020; and (5) accounting for the pandemic in evaluating compliance programs “as part of [FERC staff's] analysis under [FERC's] penalty guidelines or as part of an audit for operations.” (In the enforcement context, however, it is important for regulated entities to keep in mind that FERC continues to closely monitor its jurisdictional markets for violations of FERC statutes, rules and orders, such as prohibited market manipulation).
Chairman Chatterjee closed by making clear that FERC “will not second-guess the good faith actions that regulated entities take in the face of this emergency,” and that FERC continues to be in contact with the North American Electric Reliability Corporation and state utility commissions “to ensure that the operators of [the] electric system can primarily focus their resources on safety and on keeping the lights on.”
More information regarding FERC's response to COVID-19 is available here.
Originally published 17 April, 2020
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