04.09.06

Cantwell Presses Energy Regulators on Measures to Curb Lobbyist Influence

FERC hiring of ex-Enron attorney highlights “reverse revolving door”Senator Launches Effort to Examine Lobbyist Influence on Federal Agencies

WASHINGTON, D.C. – U.S. Senator Maria Cantwell (D-WA) is pressing U.S. energy regulators to explain their policies designed to curb the influence of lobbyists on federal agencies. In a letter sent Saturday, Cantwell asked Federal Energy Regulatory Commission (FERC) Chairman Joe Kelliher whether he would support strengthening the agency’s existing conflict-of-interest rules. She also asked how these rules would be applied in the case of a former Enron attorney recently hired by the Commission, given that Enron-related proceedings remain underway at FERC.

“There is no question that among those most hard-hit by Enron’s scandalous collapse into bankruptcy were its own employees, who lost their retirement savings in the process,” Cantwell wrote. “However, this particular situation also points to a phenomenon that has not yet been fully addressed by Congressional lobbying reform proposals and is by no means unique to FERC: the so-called ‘reverse revolving door,’ where former lobbyists or individuals otherwise employed to sway federal agencies are themselves appointed to posts within the government.”

Cantwell is concerned that Congressional lobbying reform proposals have fallen short when it comes to addressing the reverse revolving door and the way lobbyists interact with federal agencies like FERC. A search of the existing Senate disclosure system reveals more than 1,700 instances in which federal lobbyists reported contacting the Commission since 1998; yet very few details are available regarding the subject matter. FERC is an independent commission set up by Congress to safeguard American energy consumers. The Commission’s job is to protect the public interest by regulating, monitoring, and investigating interstate electricity and natural gas markets. Maintaining impartiality is a key to those efforts.

In her letter, Cantwell pointed to a number of instances that raised serious questions about lobbyist access and interaction with FERC, including:

  • a 2002 Senate Government Affairs investigation, concluding that “Enron attempted to directly and indirectly influence FERC’s investigation of the California market and subsequent decision-making” during the Western energy crisis of 2000-2001; and
  • a 2003 Department of Energy Inspector General investigation into conference calls certain Commissioners held involving parties with cases pending before FERC. The Inspector General concluded that the practice “could give rise to serious questions of fairness, including, in particular, the appearance that certain interest groups were receiving preferential treatment.”

Cantwell asked the FERC Chairman for an update on progress made on implementing the DOE-IG’s subsequent recommendations, and to weigh in on additional measures he believes could bolster the transparency and integrity of the Commission’s decision-making.

In developing potential legislation to curb the influence of lobbyists on federal energy regulators, Cantwell also plans to pose similar questions to the Chairs of the Commodity Futures Trading Commission (CFTC) and Federal Trade Commission (FTC). The CFTC has oversight of speculation in energy commodity markets; the FTC is charged with overseeing national oil and gasoline markets. To view Senator Cantwell's letter, click here 

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