Commission Watch

The commission tacks a new name onto a familiar concept.

By now it is old news that the Federal Energy Regulatory Commission (FERC) on April 28 back-pedaled on standard market design (SMD), even renaming it the "wholesale power market platform." But SMD is far from dead, as some had wished. Instead, it is merely toned down, bowing to political furor and regional differences.

Listen to Edward Krapels, director of gas and power services at Energy Security Analysis Inc. "It's easy to be an immediate critic of FERC, but I think at the highest level they had to do what they did. I don't think they had much choice." Indeed, FERC gave in to political pressure, "because the political community just was saying no to SMD, and that was just a fact they had to contend with"-not only from state commissions and the Senate, but even within the administration. "I don't think there was a lot of interest in turning the SMD into something that alienates the president from some of his constituents" Krapels believes. "I just don't think people believed in it enough to make it something they wanted to fight for."

In agreement is Mary Anne Sullivan, partner in the energy group of Hogan & Hartson, and former general counsel of the Department of Energy from 1998 to 2001. "I think they recognized that they had made a mistake, they had pushed too hard, and if they continued to push in the direction of SMD their authority was going to be cut off by the Congress," she says.