Executive Session

Floor Speech

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Ms. CANTWELL. Mr. President, I come to the floor to urge my colleagues to vote no on the nomination of Bernard McNamee to be a member of the Federal Energy Regulatory Commission. I thank my colleague from Oregon for coming out here to explain why this nomination matters and why my colleagues on both sides of the aisle should turn it down.

This is a very important time as we move forward on energy policy in the United States. I am pretty sure that my constituents probably already know what the Federal Energy Regulatory Commission does because, when it came to the Enron crisis, they had to count on the Federal Energy Regulatory Commission to make sure energy markets were properly policed. In the end, the FERC did do that, protecting consumers from what were unjust and unreasonable rates.

However, the fact is that a lot of Americans don't understand what the Federal Energy Regulatory Commission does. That is because the job of the Commission can range from overseeing the reliability of the electricity grid to ensuring that wholesale electricity and natural gas rates are just and reasonable. That was what we argued in the Enron case. They were going to make utilities pay for 9 years on what were fraudulent contracts. We emphasized: How could fraudulent Enron contracts ever be just and reasonable if they had admitted to manipulating them?

The Federal Energy Regulatory Commission also oversees the licensing of hydroelectric dams and approves construction of natural gas pipelines. We also rely on FERC to protect the electric and national gas markets, as I mentioned, from manipulation.

After Enron, we ended up putting even stronger language in the law to make sure the definition of manipulation was clear and people were protected. I remember my colleagues from Texas joining me in getting that language passed because they knew how much the Enron manipulation cost all of us and our economy.

These are important responsibilities. The Federal Energy Regulatory Commission deserves due diligence of their record done by Members of the Senate because FERC decisions affect many energy projects and how people will pay to heat their homes and keep the lights on. It is also about how we protect our energy infrastructure for the future. Trust me, the number of cyberattacks that are going on in energy, we want to exercise strong oversight of these nominees.

It is important that the Commission remain independent and impartial because its role is quasi-judicial. Like judges, they need to be impartial, making decisions about important energy projects that get built around the United States.

For this reason, one of the qualifications written into the law creating the Commission is that members be ``individuals who, by demonstrated ability, background, training, or experience, are specially qualified to assess fairly the needs and concerns of all interests affected by Federal energy policy.''

I would add that it is the duty of the Senate to make sure that these commissions remain free from political influence. I know that, from time to time, people have been on the Commission and there have been issues about how those on the outside have tried to influence them. We must continue to make sure that the Federal Energy Regulatory Commission remains above this kind of political influence and that they remain unbiased as decision makers on these important policies. I believe that this nominee, Mr. McNamee, does not meet this standard. I believe that he is too ideologically motivated to undertake a job where fact-based decision-making is essential to outcomes that affect people's individual energy rates.

The Commission has to police and regulate energy markets without regard for fuel source, market power, or political lens. I want to see Commissioners who have the words from the Federal Power Act of ``just and reasonable rates'' practically tattooed into their psyches. Why? It is the standard by which they should judge our nation's energy projects.

Like many of my colleagues, I have been troubled by this administration's effort to try to subsidize high-cost, coal-fired power plants at the expense of American ratepayers. According to a July report by experts at the Brattle Group, the administration's bailout plan would have cost consumers $34 billion over 2 years. That would have been a $34 billion tax on American consumers. How would they have done that? By saying that you have to use coal-fired electricity as a way to keep the grid reliable. I disagreed with that. I would say, probably, many members of the Energy and Natural Resources Committee disagreed with that, and, clearly, members of the Federal Energy Regulatory Commission, as it is currently comprised, also disagreed with that.

Why was there such an adamant reaction? It is almost as if you were saying that, instead of letting the market make these decisions, people were going to force utilities to do projects that included coal-- forcing coal onto the grid, even though the renewable energy was driving down costs and helping consumers to diversify. This is important because the bailout proponents have argued that coal is needed to ensure the grid is always working. When you look at this analysis, it does not hold up under the scrutiny. Trying to prop up uneconomical coal plants for the sake of the reliability of the grid is a fake rationale that the administration tried to use, and it would have impacted the free market and consumers.

I know that these rate increases would hurt manufacturers--because we have a lot of manufacturers in the State of Washington--who rely on affordable hydro to help drive down the cost of manufacturing. I think the cost of doing business and electricity rates all through the United States are going to be key issues for how we drive manufacturing competitiveness in the future. I certainly don't want to see a mandate by this administration that you have to use coal and drive up the costs for that manufacturing base and our consumers.

A fuel security report that was issued last month by the PJM Interconnection, which extends from Pennsylvania to New Jersey and all way to Illinois, found that there was no need to prop up uneconomical power plants. They were confident that their grid-- which is the world's largest competitive wholesale electricity market-- would remain reliable over the next 5 years without having this mandate to use coal-fired electricity.

And this conclusion has nothing to do with the temperature outside. Even in a severe cold snap, the grid would continue to operate. In fact, the Washington Examiner--hardly a newspaper from which I quote a lot on the Senate floor, but I am going to in this case--reported that the largest power grid operator dismisses the threat of coal and nuclear power plant closures. It was referring to this report. It was referring to the PJM report that basically says: No, we don't have to worry about our grid reliability. This report dismisses the notion that the coal plant closures would somehow put us all at risk.

People are asking: What does that proposal have to do with Mr. McNamee?

As a senior political appointment at the Department of Energy, Mr. McNamee had a key role in promoting and defending this policy. He had a hand in ignoring the other experts at the DOE, who basically told him that his facts were wrong. He ignored the fact that this bailout proposal would place an undue burden on ratepayers and, as I mentioned, would impact our economy moving forward. He ignored the fact that we are seeing changes in clean energy markets--that they are cheaper and more effective than coal--and that this proposal, even though he continued to push it, was not going to help us keep an open and free electricity market.

Part of what the energy regulators do is to make decisions about projects moving forward that are based on what the market is bringing them. It is based on pure economics. Their job is to determine the return and the rates that would impact consumers. That is where the term ``just and reasonable'' comes into play. Their job is not to pick winners and losers in the market. Their job is to determine whether there will be just and reasonable rates for the individual consumers in those markets. It is their job to make sure that there are not excessive prices but true competition in the market--not to favor a high-cost fuel source like coal and try to protect it from other fuel sources that might be more economical for consumers.

As the Supreme Court has said, FERC is the guardian of the public interest in these matters. The duties of Commissioners is to protect the public interest, not the private interest, and they are to make sure there are fuel supplies for the future.

I view this threat of really trying to disrupt the free market as one of the most important things we need to continue to protect. Why? Because innovation shifts markets over time. We are trying to make decisions about distributed energy, and there will be major discussions by the Federal Energy Regulatory Commission on how to achieve that, particularly as we deal with the impacts of climate change.

Our historic energy system is at an inflection point, but it doesn't mean we should hold on to more expensive sources to generate electricity. It means that we should make sure that the Federal Energy Regulatory Commission does its job as a quasi-judicial arbiters and are not politically motivated or coming to issues with non market-based rate solutions.

The fact the cost of wind has declined an incredible 69 percent over the last 9 years and solar a whopping 88 percent. If coal or nuclear costs had dropped that much, we would be having a different conversation about their future, but it hasn't. Even in States where coal has been a big part of the mix, building renewables is cheaper than keeping existing coal plants open.

According to the Northern Indiana Public Service Company's 2018 Integrated Resource Plan, they found that they could save their constituents $4 billion over 30 years by ramping down the amount of coal it uses from two-thirds of its generation today, to 15 percent by 2023, and by eliminating coal entirely by 2028.

I would like to have taken Mr. McNamee at his word when he came before the Senate's Energy and Natural Resources Committee and said that he would be a ``fair, objective, and impartial arbiter.'' That is what you want from a Federal Energy Regulatory Commissioner. He also said that he would decide matters that would come before him based on the law and not based on politics. Yet, after his committee hearing, which I still remain very concerned about, we asked further questions. And a video of a speech Mr. McNamee gave earlier in the year on fossil fuels surfaced. I believe it shows that he has a continued bias beyond the President's asking him to draft a coal bailout. And he has tried to push it through the Federal Department of Energy even when scientists and others have told him that the facts just did not support the proposal.

Mr. McNamee's words reveal a very strong bias in favor of fossil fuels against renewable energy. For example, he claimed that fossil fuels were ``key not only to our prosperity'' but ``to a clean environment.'' And he continued to make comments that, I think, are demonstrably false. Now, as a private citizen, he is free to say whatever he wants. Yet, when you are hired to put a report out and have scientists within the agency correcting your false information and you are continuing to push these ideas, I think it puts you in a different category. It is hard to believe that you will be quasi-judicial and a fair arbiter.

I know that he has had many conversations, and I include the information in the video. One of his most striking statements is this: ``The green movement'' is in a ``constant battle between liberty and tyranny.'' Then he said that his son should just deny climate science even if it hurts the boy's grades. These are not the words or sentiments, I believe, of someone who is going to play that role of an arbiter for Federal energy regulatory policy.

And these policies will come up before the Commission. I know the administration plans on continuing to find ways to have coal mandated into the market instead of allowing the free market to take place. I want to make sure that the Federal Energy Regulatory Commission does not subject itself to some sort of bias in this process.

If Mr. McNamee becomes a Federal Energy Regulatory Commissioner and if he continues to try to overturn relevant FERC decisions in court by arguing against these things, what kind of process will we see at the Federal Energy Regulatory Commission in response to his biases?

To me, you have the threat of legal uncertainty. Projects could be put on hold. Investments could be further delayed. Grid reliability rules could be impacted. Why? Is it because he is right? No, people already believe his previous statements have shown sufficient bias that would put in question his decisions on the Federal Energy Regulatory Commission. These energy policies, particularly in the area of cyber security, are going to be so critical for us to move forward on. Every day, our grid is impacted by these attacks by foreign entities. It is so important that we get about the task of making our grid more reliable and better protected against cyber security, not getting weighed down in a bunch of arguments against someone who does not appear, in my opinion, to have that quasi-judicial approach of making sure that the market and market decisions are fair and reasonable and just and reasonable rates for consumers. All of this is particularly distressing as Mr. McNamee's speech surfaced just days before the U.S. Global Change Research Program released its fourth quadrennial report.

Why is this important? Because the report showed the cost to the Federal Government and individual citizens of continued fossil fuel use. We all know that we need to have a diverse sources of energy. We know that we have to do better than what we are doing today. Yet, by pushing Mr. McNamee's name forward, this administration is simply trying to hold onto the past.

That approach could cost taxpayers trillions of dollars over the next few decades. The climate assessment basically estimates that, if we do nothing, by the end of the century the impacts will cost the United States upward of a half trillion dollars a year in crop damage, labor loss, and extreme weather damages. We can't afford that. We need to keep moving forward, and we need to let the market do its job.

For over 40 years, an independent and impartial Federal Energy Regulatory Commission has provided Americans with decades of fuel-neutral competition, which has resulted, as I said, in those just and reasonable rates. Now, thankfully, technology advances are helping us to step up to new opportunities while still having the Commission oversight, based on just and reasonable rates. The Commission is making sure that we are doing all that we can to hold down the costs to consumers and move things forward in energy markets.

I ask my colleagues to review the video and this nominee's remarks in the video and to come to the Senate floor to vote against this nominee in the hopes that we can get someone else to take this job at the Federal Energy Regulatory Commission. I hope my colleagues will realize the importance of this before it is too late and that we will move forward with someone who can help us continue to have a Federal Energy Regulatory Commission.

Clearly, this is not viewed as just politics on our side. There are many people who are on the Federal Energy Regulatory Commission who have very strong political backgrounds. A few used to work right here in the Senate. So this is not about that. This is about somebody's having the quasi-judicial mindset to review these issues and not advocate, at all costs, a market-eroding notion that utilities should be forced to purchase uncompetitive coal and raise rates on consumers.

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