FERC Commissioner and former Chairman Joseph T. Kelliher resigned from the Federal Energy Regulatory Commission effective Friday, opening the door for President Obama to bring in his own candidate for commissioner and possibly the next chairman of the five-member agency.

Kelliher, a Republican who was tapped as agency head by President Bush more than three years ago, stepped down as chairman when Obama took over as president in late January, but stayed on as commissioner while pursuing outside job opportunities (see NGI, Jan. 12). So his announcement last week that he was leaving FERC came as no surprise.

After he took office as president Obama quickly tapped Democratic Commissioner Jon Wellinghoff, a favorite of Senate Majority Leader Harry Reid (D-NV), as acting chairman of the Commission (see NGI, Jan. 26). The last Democratic chairman at FERC was James Hoecker, who left in January 2001.

By selecting Wellinghoff as interim chairman, the Obama White House “[kept] their options open” to bring in an outsider as full-time chairman at a later time, although there’s “always the possibility” that Obama could keep Wellinghoff on as chairman indefinitely, a gas pipeline industry source said.

Even if he proves to be a short-timer as chairman, Wellinghoff will have left his mark. Two major high voltage power lines to supply his home state of Nevada were approved at his first meeting as chairman. The action also opened up the potential for more western transmission projects, changing FERC policy to allow anchor shippers for power transmission projects and approving major power lines outside of a regional transmission organization.

One outsider that had been mentioned as possible FERC commissioner and chairman is Charles E. Box, chairman of the Illinois Commerce Commission.

“I wouldn’t be surprised” if Obama picked someone from outside the agency for chairman, a Washington source said, adding that such a person was more likely to have actively supported Obama during his campaign than the sitting FERC commissioners. “By the time you win the White House, you owe a lot of favors along the way.”

With the departure of Kelliher, the political makeup of the Commission will be evenly split — two Democrats and two Republicans. But Obama’s replacement for Kelliher, whose term ends in June 2012, will surely be Democratic, thus tipping the scales in favor of the Democrats at FERC.

Kelliher had been chairman of FERC since July 2005, after having served as commissioner since November 2003. Prior to FERC, he was a senior policy advisor at the Department of Energy. It was not immediately revealed where Kelliher will be hanging his hat in the future.

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