Wellinghoff Named Acting Chairman of FERC

Industry execs with good luck in Vegas might want to put some money down on President Obama eventually eliminating the “acting” adjective he put in front of the title of new FERC “Chairman” Jon Wellinghoff.

Obama named a number of acting chairman at federal regulatory agencies a few weeks after occupying the White House, probably because there hadn’t been enough time to vet them yet, so there was nothing particularly peculiar about Wellinghoff’s acting designation.

There is also some precedent. President Clinton appointed Betsy Moeller as acting chairman of FERC in 1992 and then made her permanent chairman.

Odds are good Wellinghoff will become permanent FERC chairman for two reasons. First, he is a Nevadan and was sworn in as a FERC commissioner by Sen. Harry Reid (D NV), the Senate Majority Leader. That gives him a tremendous leg up, politically, over any other contender for the permanent chairmanship. Moreover, he is well known as an advocate of a Renewable Portfolio Standard (RPS), where electric utilities are forced to generate increasing amounts of electricity from wind, solar and other alternative sources. That dovetails with President Obama’s drive to quickly inject a heavy dose of “green power” into the U.S. economy.

Wellinghoff is best known for his promotion of renewable energy generation. He has a much narrower profile on natural gas issues, except for liquefied natural gas (LNG), where he has carved out a role as FERC’s Dr. No. Wellinghoff was the only one of five commissioners to vote last September against approval of the Bradwood Landing LNG facility in Oregon. Back then, he jangled the nerves of the natural gas industry by suggesting that wind and solar might be more environmentally preferred to natural gas.

He again showed his antipathy for LNG when he cast a lonely “no” against the AES Sparrows Point LNG Terminal & Mid Atlantic Express Pipeline on Jan. 15, 2009. That project would consist of an LNG import terminal on the Chesapeake Bay in Baltimore County, MD, and 88 miles of pipeline that would interconnect the terminal with three existing interstate pipelines.

But one industry source suggested that Wellinghoff used his Sparrows dissent as a way to reassure the natural gas industry that it was mistaken if it thought Bradwood made him an enemy of natural gas. In Sparrows Point, Wellinghoff said it made more sense to get additional gas to the south and mid Atlantic regions by tapping gas from the Marcellus shale which extends through much of the Appalachian basin, with the core area running through Pennsylvania and parts of West Virginia, Ohio and New York. The effective delivery of Marcellus shale gas could be accomplished with expansion of pipeline and storage infrastructure in the region. For example, Columbia Gas has proposed to expand its storage in Ohio, in part, to facilitate access to increased production in the Appalachian basin.

“He was doing a savvy thing in Sparrows Point,” says the industry source about Wellinghoff. “He was saying ‘Let me be clear about what I meant in Bradwood Landing.’”

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