Commissioner LaFleur Leaves -- Logjam Ends -- Lack of Quorum Begins (for Some)
In the last week of August, Commissioner LaFleur stepped down as a Commissioner at FERC, leaving only three members, out of the authorized five. In addition, Commissioner McNamee sought a conflict waiver from the White House, which created a conflict problem for Commissioner Glick. The bottom line of all of this is that, while there are still serious disagreements about how to address greenhouse gas emissions, the voting logjam that existed with respect to those issues for pipeline projects has been broken as the Republicans now hold a 2-1 majority. But, because of the newly clarified conflicts ruling concerning Commissioners Glick and McNamee, there are a couple of projects, TC Energy’s Buckeye Xpress and Kinder Morgan’s 261 Upgrade project, for which there will be no quorum until November 29, 2019.
The Greenhouse Gas Logjam Ends
As we discussed back in June in LaFleur is Leaving FERC -- What Does That Mean for the Pipeline Project Queue? , the apparent split on the Commission about how to address greenhouse gas emissions has led to a backlog of pipeline project approvals. The disagreement among the commissioners about how best to address climate change and greenhouse gases continues. But the 2 to 2 voting logjam that was created by each commissioner having his or her own view has seemingly been resolved with the departure of Commissioner LaFleur, as evidenced by the decisions at yesterday’s open meeting to approve Tallgrass’s Cheyenne Connector Pipeline and Cheyenne Hub Enhancement projects. These were two of the oldest projects waiting in the queue. Interestingly, one older project, Kinder Morgan’s South Mainline Expansion Project, remains in limbo. As the following graphic shows, the projects that were awaiting a FERC certificate at the time at FERC’s open meeting yesterday are well past the median for similar projects and are quickly becoming outliers in our data set.
The Recusal Logjam Begins
With the Commission down to only three members, if one does not participate, the other two can not act on a matter, even if they agree. The industry became familiar with this problem in 2017 when Commissioner Bay stepped down, leaving FERC with only two commissioners. Under FERC’s quorum rules, there must be at least three members participating in a vote for the Commission to take an action. That is why a recent decision by the White House Counsel’s office has created a quorum problem for FERC following Commissioner LaFleur’s departure.
As explained in a statement issued by Commissioner Glick, FERC’s ethics office had previously informed him that under the Trump Administration's Ethics Pledge signed by all Executive Branch officials appointed by the president, Commissioner Glick was barred from participating in any cases in which AvanGrid (and its affiliates and subsidiaries) was a party for the two years following the date he left that company, February 5, 2016. However, as a result of a decision by the White House, made public on September 9, in response to a request by Commissioner McNamee, it became clear that the advice Commissioner Glick had received was incorrect.
In the response to Commissioner McNamee, the White House senior ethics counsel determined that the pledge that both commissioners had taken to recuse themselves for matters in which they had a conflict would extend until two years following their appointment to the Commission. For Commissioner McNamee, that would mean his recusals would continue until December 11, 2020 and that Commissioner Glick would need to recuse himself from AvanGrid matters until November 29, 2019.
With Commissioner LaFleur’s pending departure, Commissioner McNamee had requested a waiver of that restriction so that he could participate in cases involving parties represented by his former law firm, McGuireWoods. The White House granted Commissioner McNamee his requested waiver because his continued recusal would prevent FERC from having a quorum to act. Upon hearing of the new interpretation, Commissioner Glick decided he would not seek a similar waiver, noting in a statement issued on September 18, that he takes such obligations “very seriously” and thinks that seeking a waiver would not be “consistent with the commitment I made when I signed the Ethics Pledge.”
This means that Commissioner McNamee’s recusals that we had discussed in LaFleur is Leaving FERC -- What Does That Mean for the Pipeline Project Queue? with respect to TC Energy and Dominion projects may no longer apply. However, it also means that Commissioner Glick will now be recusing himself in all matters in which AvanGrid (and its affiliates and subsidiaries) have intervened as a party. That is bad news for two of the projects identified in the graphic above, the Buckeye Xpress and 261 Upgrade projects. In both of those projects, an AvanGrid subsidiary has intervened and so it looks like FERC will not have a quorum for voting on those matters until November 29, 2019. That is the date shown in the above graphic for those two projects and is undoubtedly not welcome news to either.
We would expect the other projects that are in the queue to be approved between now and November 29, but they will all still end up being outliers in our data set for the time it took FERC to issue the order following the issuance of the environmental assessment.
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