In this edition, we’re untangling the high-voltage drama at FERC, as a new executive order aims to crank up the heat on the independent energy market regulator.
Flipping the switch on FERC
Last week, President Trump issued an executive order asserting White House oversight over independent agencies, including the Federal Energy Regulatory Commission (FERC). The move could short-circuit FERC’s historical autonomy and leave energy policy more vulnerable to shifts in political currents.
What happened
Under the new executive order, "Ensuring Accountability for All Agencies," independent agencies, from FERC to the National Labor Relations Board to the SEC, among others, must now align their policy priorities with the Executive Branch and submit major regulatory actions for White House review.
FERC, in particular, is the energy market’s referee. Created by Congress after the 1973 oil crisis, it was built to call the shots without political interference — but its rulings still shape the field. FERC oversees everything from interstate electricity and natural gas transmission to wholesale energy markets and big-ticket infrastructure like pipelines and LNG terminals. It’s led by up to five bipartisan commissioners, appointed by the President and confirmed by the Senate, serving staggered five-year terms (the line-up is currently Chairman Mark Christie (R), Commissioner Willie Phillips (D), Commissioner David Rosner (D), Commissioner Lindsay See (R), and Commissioner Judy Chang (D)).
But the rulebook is shifting: FERC now must consult with the Office of Management and Budget (OMB), the Domestic Policy Council, and the National Economic Council before making big calls — just as it’s juggling 15 pending regulations, including potentially game-changing proposals on transmission incentives and grid planning.
Why it matters
FERC is at the eye of the energy storm. With rising electricity demand from electrification and AI, grid reliability concerns are mounting. Meanwhile, the Trump administration is going all in on fossil fuels — i.e. "drill, baby, drill". It’s backing off on the National Environmental Policy Act, which requires federal agencies consider environmental consequences in project approvals. In addition, it’s fast-tracking hundreds of fossil fuel projects via executive emergency designations. At the top of the agenda is natural gas expansion, with a newly formed “energy dominance” council pushing for increased exports and offshore drilling(despite US oil and gas production already hitting record highs). Several natural gas pipelines and terminals are in the long queue of projects waiting for certain regulatory approvals, which could now see a shake-up.
Meanwhile, that queue of all projects waiting to connect to the US grid, which hit 2.6 terawatts (TW) in 2023, is double the size of the existing grid. This backlog isn’t just due to volume; it’s also a transmission bottleneck. High-voltage transmission lines critical for integrating new renewables and storage projects simply aren’t getting built fast enough. FERC’s re-focus around gas could delay these even longer.
For context, this isn’t the first time Trump has sought to influence FERC. During his first administration, the DOE reportedly wanted FERC to bail out coal and nuclear plants for “grid reliability.” FERC, including Trump-appointed commissioners, unanimously rejected the proposal. Under this new executive order, such independent decision-making could be far more difficult.
Key takeaways
🏛 Legal and political battles ahead. The legality of the executive order is still murky. FERC Chairman Mark Christie downplayed its impact, per Utility Dive, saying that FERC already follows the rules outlined in the order. But other legal experts see a different play unfolding — potential court challenges over whether this move unconstitutionally expands presidential power over an agency meant to run the energy markets fairly. Expect pushback from Congress, too: Democrats and even some moderate Republicans are opposing it, and while lawmakers could try to reaffirm FERC’s independence through legislation, any bill would likely face a presidential veto.
🚦 More gridlock for projects. With over a dozen pending regulations, subjecting FERC to White House review could delay critical energy infrastructure development. Plus, FERC processes over 1,000 cases a year related to energy projects. Adding White House oversight could worsen the backlog, slowing everything from pipeline permits to market rule changes.
📈 Surge in investor uncertainty. The executive order introduces new risks for energy investors, particularly in renewables and advanced grid technologies. FERC’s authority over transmission approvals and market rules directly impacts infrastructure investments and technology deployment. If regulatory decisions become subject to political swings, long-term projects could face heightened financial uncertainty, slowing capital deployment in the sector.
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