Coal rules may derail second Obama nominee

President Obama's nominee to head the Federal Energy Regulatory Commission (FERC), Norman Bay, is feeling the heat on the president's coal plant rules during his confirmation process.

Republicans on the Senate Energy and Natural Resources Committee drilled Bay Tuesday on his energy policy chops, specifically hitting on what he would do if the Environmental Protection Agency (EPA) rules limiting coal plants' carbon output are finalized.

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"When it comes to specifics on the policy, my observation is that there are still areas where you have yet to gain that level of experience on that policy side, and I want to make sure that the FERC is not rolled over by the EPA and I think sometimes that is what happens," Sen. Lisa Murkowski (R-Alaska) told Bay.

"You need to stand shoulder to shoulder with them as an agency," the ranking member added.

Sen Joe Manchin (D-W.Va.), who opposed Obama's first nominee to lead FERC on the basis of bias against the coal-industry, pressed Bay on how he would handle the coming carbon limits on power plants.

"What steps would you be prepared to take that would review the impacts of the greenhouse gas emissions [limits] by EPA," Manchin said.

Bay, the current director of FERC's enforcement wing, said the No. 1 focus would be reliability of the power sector.

"I would be looking, if confirmed, to try to access what the reliability impacts are and what FERC can do to work with key stakeholders to ensure that there is sufficient planning and preparation and discussion," Bay said.

Manchin went on to ask that if EPA's desire to regulate power plants did not line up with reliability, would FERC overrule or not adhere to the coal rules based on practicality.

Cheryl LaFleur, also an Obama nominee to sit for another term, said that FERC and its commissioners like her do not have control over EPA's rule, but would voice their opinions openly, and look to other energy sources like natural gas where needed.

Still, Manchin indicated that such regulation by the administration could lead to lose of lives if power remains offline for too long, and coal plants are able to support the grid.

The issue of Bay's energy chops on such matters isn't the only quibble some senators had during the hearing.

While all Democrats on the committee, save Manchin, spoke fondly of Bay and are likely to vote in his favor, Republicans questioned him on his experience, and about reports that his credibility may be at stake.

Sen. John Barrasso (R-Wyo.) hit Bay with accusations that the enforcement wing he leads at FERC has been wrongfully investigating businesses on charges of market manipulation.

"I find this troubling," Barrasso said. "I also believe that these tactics have contributed to driving investors out of the electricity markets, and that means a less reliable electric grid and higher cost for consumers."

When asked why the committee should approve his nomination "given the wide gap in experience" between himself and Lafleur, the current acting chairwoman of FERC, Bay said the senators "would have to ask the White House."

Bay shot back that his nomination was likely based on the fact that he has done work to protect consumers, "the integrity of the market place," and even the playing field for all market participants.

Former Sen. Pete Domenici (R-N.M.) also testified in defense of Bay, saying that while he may not always support the president's policies, Bay is without a doubt qualified.

Domenici, who chaired the Senate Energy committee during his time in office, said Bay "typifies the American dream."

"It isn't always that we get a candidate of this stature," Domenici said, detailing Bay's education in law. "I would urge that this committee support him. I'm not a great fan of the President of the United States, and people know that, but I think this is a great appointment."

The White House also spoke highly of its pick on Tuesday.

“Norman Bay is a proven leader with expertise in the energy markets, an evenhanded approach to enforcing the law, and a history of bipartisan support," said White House spokesman Matt Lehrich. "He'll make an excellent chairman, and the Senate should move swiftly to confirm him so that FERC can do its crucial work."

While Bay will likely garner favorable votes from the Democratic senators on the committee, it remains to be seen if Republicans will fall in line to back the nomination.

"This is an extraordinarily important commission and becomes more important every day as we talk about the issues that so many have raised today as it relates to reliability, as it relates to capacity, to pricing for the consumers," Murkowski said. "If it is viewed that the commission is not operating in manner that delivers a level of credibility this is a problem for us."