Moler A Leading Candidate to Replace Pena at DOE

With his family in tow, Energy Secretary Federico Pena announced last week he plans to leave the Department of Energy (DOE) for personal and family reasons effective June 30th, the news of which elicited ho-hum reactions from the natural gas industry and spurred speculation that Deputy Energy Secretary Elizabeth Moler will succeed him.

While gas trade groups officially applauded Pena's efforts at the department, unofficially they sang a different tune in the wake of the surprise announcement. "What has he done? Who cares?" said one gas insider of Pena's imminent departure. "The DOE was supposed to come out with electricity legislation" during his one-and-a-half year tenure. Instead, "they've been completely stonewalled by the EPA. They came out with principles [rather than legislation]. They haven't advanced the debate on restructuring one iota."

Apart from electricity reform, Pena's leaving shouldn't be a source of great concern for natural gas since most of the key issues that the industry's focusing on are at the Federal Energy Regulatory Commission rather than at DOE, said John Sharp, director of federal affairs for the Natural Gas Supply Association (NGSA). "Certainly everyone's interested in their [DOE's] electricity principles, but I think FERC is the place to be for gas."

The timing of Pena's departure - in the middle of electricity restructuring - was criticized on Capitol Hill. "I'm very disappointed by Secretary Pena's resignation," said Sen. Frank Murkowski (R-AK), chairman of the Senate Energy and Natural Resources Committee. He noted Pena's premature departure "may make it difficult, especially for electric rate deregulation, to proceed this year" in Congress. But Pena disagreed. Rather than slowing the process down, he sees the news of his early departure "really energizing" the focus on a number of issues, including reform of the electric industry. Pena said he hopes to "bring closure" to as many issues as possible by the time he leaves the department. He conceded this was an ambitious undertaking, but he doesn't think it's impossible.

Gas insiders believe the best thing the Clinton administration could do for DOE and the fate of electricity restructuring would be to tap Moler as Pena's successor. "To the extent that she is selected, I think she would be a fantastic secretary. Her depth of energy knowledge and issues is very good. She would be more than capable of being the steward of that agency," Sharp remarked. In fact, energy sources initially had expected President Clinton to pick Moler to head up DOE during his second term, but he stunned everyone when, bowing to pressure from the Hispanic community, he selected Pena - someone who had no experience in energy - in December 1996. Moler, former FERC chair, accepted the job of deputy energy secretary four months later, but it reportedly was conditioned on assurances from the White House that she would succeed Pena when he stepped down in mid-term.

"I think Betsy's in a very good position given the fact that she's over there [at DOE]; she's running the show," Sharp noted. He doubts the Clinton administration will pick a lightweight for the job this time around because whoever's chosen will have to see some tough issues, such as electricity restructuring and nuclear waste, down to the wire. Pena, who apprised Moler of his decision to leave prior to announcing it publicly last Monday, said he's "very confident" that her name will be "right up there" on a short list of possible successors.

There have been some reports that Moler has been disgruntled with DOE's lack of success on the restructuring front, and has been shopping outside the agency - at various Washington D.C. law firms - for another job. "They're doing a lot more interesting work in terms of electric restructuring than she is at DOE," an energy source said. But "I guess if she were offered this position [Energy Secretary] she would stay. It's quite a resume builder."

Susan Parker

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