Manchin: ‘Affordability Is Not Optional’

Manchin raises concerns about inflation of energy prices at first appearance of sitting FERC commissioners before the Committee since 2018.

September 28, 2021

To watch a video of Senator Manchin’s opening remarks, please click here.

To watch a video of Senator Manchin’s questioning, please click here.

Washington, DC – Today, the U.S. Senate Energy and Natural Resources Committee held an oversight hearing of the Federal Energy Regulatory Commission (FERC). During the hearing, Senator Joe Manchin (D-WV), Chairman of the Committee, stressed to the commissioners the need to keep electric services affordable and questioned them about increased consumer energy costs.

“According to the Bureau of Labor Statistics, over the last 12 months, the Consumer Price Index for energy has increased by 25% overall… As I said in my opening remarks, affordability is not optional. I’m concerned we are on a runaway rise. Can all of you comment on how FERC takes inflation into consideration when carrying out its authorities and determining what is reasonable?” asked Chairman Manchin.

“We take our jobs seriously in terms of regulating electricity markets to make sure as much as we can that they are sufficiently competitive and the rates that are resulted are just and reasonable,” said Commissioner Richard Glick.

“In every case we do we have to be very sensitive about cost to consumers, because what FERC does effects retail rates and that’s what flows through to monthly bills, so I think cost has to be uppermost in every preceding,” said Commissioner Mark Christie.

“I think the two things we can do are plan ahead to save customers money and also encourage non-discriminatory competition,” said Commissioner Allison Clements.

In referencing the widespread outages in Texas and other states last winter, Chairman Manchin questioned the commissioners about the mutual dependence between natural gas and electric systems.

“FERC’s interim report on the 2021 winter storm indicated Texas and south-central U.S. are heavily reliant on natural gas for fueling electric generation to meet peak capacity and energy needs. At the same time, the natural gas infrastructure is heavily reliant on electrical power for producing, processing, and transporting natural gas to end-users. As we all saw, this relationship was managed in February in a way that failed consumers drastically. FERC has been thinking about gas-electric coordination for years. Why haven’t we solved this problem yet?” Chairman Manchin asked.

“Two issues, firstly with regard to gas electric coordination, it is my opinion that the commission has been too deferential, we’ve only approved changes that both industries could agree with. I think we need to bring the two sides together and knock heads and suggest we really need to make some changes. Secondly, and most importantly, while we have reliability standards for the electric industry, we do not have them for the natural gas industry including pipelines. I think it’s something Congress needs to seriously take a look at because we saw what happened in Texas and the consequences are very severe,” Commissioner Glick said.

“We have been talking about it for years, in fact the last concrete action we took…was to implement new standards to get the day-ahead scheduling fixed between the two. This is extremely esoteric material for a lot of the mechanics for the interaction between the two of them. But it’s a subject that we’re constantly concerned about and we’re working on it actively,” said Commissioner James Danly.

 “Whether it be Texas, California, New England, across the country, the Gulf Coast - we have to think about planning, market design, and reliability standards. We can’t just fix one they all fit together,” said Commissioner Clements.

The hearing featured testimony from the four current sitting FERC commissioners. To read their testimony click here.

To watch the hearing in full, please click here.