The Federal Energy Regulatory Commission (FERC), formerly known as the Federal Power Commission (FPC, est. 1920), is the federal agency responsible for regulating the transmission of electricity, natural gas, and oil. It has jurisdiction over state-to-state electricity sales, wholesale electric rates, hydroelectric licensing, natural gas pricing, and oil pipeline rates. It also reviews and authorizes liquefied natural gas (LNG) terminals, pipelines and non-federal hydropower projects.
The agency has its roots in the Federal Power Commission (FPC), a small federal agency created in the 1920s to regulate hydropower dams. President Franklin D. Roosevelt pushed legislation to dismantle utility monopolies in the 1930s, and the Federal Power Act of 1935 and the Natural Gas Act of 1938 gave FPC the power to regulate the sale and transportation of electricity and natural gas. FPC’s new role included a responsibility to set “just and reasonable” wholesale electricity prices. (Subsequent legislation and legal decisions through the 1940s, 50s, and 60s expanded FPC’s role to include regulation of natural gas facilities—including those producing natural gas sold in interstate commerce, intra-state power sales transmitted over state lines and intrastate utilities (if connected to others outside the state).
Frontline's interviews with FERC Commissioners
, and FERC economist
FERC oversees and regulates the wholesale energy market, including inter and intra-state operations. According to the agency:
Energy traders; States (legislatures, regulatory commissions); utility companies, retail energy and electricity industry and marketing; wholesalers; energy consumers (businesses, individuals, organizations); natural gas industry;
Liquefied Natural Gas import terminal in Maine
(Department of Ecology News Release)
In recent years, FERC Orders 888 and 889 have been introduced in order to reform “pro forma open access transmission tariff,” or OATT, —towards eliminating “discriminatory practices” and increasing “transparency” in the provision of transmission services.
Pat Wood is a former Texas Public Utilities Commission Chairman and long-time Bush ally. A proponent of deregulation, he was appointed by Bush to head FERC at the urging of former Enron Chairman Kenneth Lay.
On March 19, 2009, President Barack Obama named Jon Wellinghoff Chairman of the Federal Energy Regulatory Commission (FERC), the agency that oversees wholesale electric transactions, interstate electric transmission and gas transportation in the United States. A member of the Commission since 2006, the Senate reconfirmed him to a full, five-year FERC term in December 2007. Shortly after his appointment by President Obama, Wellinghoff stated that climate change would be, “a big priority for me. From everything I’ve read, we’re in big trouble and we need to do everything we can to reduce our carbon footprint.”