Neil Chatterjee's political balancing act

Neil Chatterjee thinks a second Trump term “is going to surprise people.”

Chatterjee twice chaired the Federal Energy Regulatory Commission during the first Trump administration, but was ousted from his position in late 2020 over his stance on carbon pricing. During his tenure, though, he spearheaded the passage of Order 2222, clearing the way for distributed energy resources to participate in energy markets. 

He made headlines in early November when he took to social media to offer the transition team insights on “who to keep and who to remove” at the agency. He told Politico in November that he hadn’t yet been asked to join the new administration, but would “consider it” if he was.

But in the meantime, he’s making moves in the private sector. This week he announced his new roles on the boards of virtual power plant company Voltus and AI asset management startup AiDash.

The choices are strategic. They represent the intersection that Chatterjee is betting will be the focus of FERC and legislators on the Hill moving forward.

“I think the preeminent issue of the next couple of years for FERC, and for energy writ large, is going to be ‘how do we meet this coming surge in demand, while maintaining reliability and affordability?’” Chatterjee told Latitude Media at Deploy24 this week.

And while this is an issue that industry and utilities have been grappling with for over a year already, it’s fast becoming a focus for policy makers as well. 

“I don’t think policy makers on either side have wrapped their brains around the amount of power it will take to win the AI race,” Chatterjee added. “And I think it’s going to totally upend the conventional wisdom around energy.”

That conventional wisdom includes the framing of whether a party "believes in climate change,” and the binary that Democrats are for clean energy, and Republicans are for fossil fuels. 

“That may be the case today, but we’ve had flat demand for two decades,” he said. “We’re getting ready to enter a new chapter, where we don’t quite know how the power side is going to meet the coming surge in demand while keeping electricity affordable and reliable.”

And as a result, he thinks it’s time to throw the last 15 years of energy politics “out the window.” 

Private sector plays

Voltus, which claims to have more than seven gigawatts of DER capacity under management, is already actively involved in the race to support data center load. The company is operating a first-of-a-kind community-scale VPP program, which it calls Carbon Response. That program, funded by Meta, allows industrial customers like data centers to procure capacity from others on the grid.

“Customers procuring capacity from other customers is such an interesting model,” Voltus CTO Neil Lakin said of that program in an interview with Latitude Media earlier this year. “The idea of [a customer] purchasing flexibility from other loads, I personally have never seen before.”

Chatterjee actually began advising Voltus several months before this week’s official announcement. And he’s working with John Wellinghoff, another former FERC chairman and Voltus’ chief regulatory officer, to define the company’s strategy and policy innovation work. (The chance to work again with Wellinghoff was what drew Chatterjee to Voltus in the first place, he said, adding that the image of two former chairmen from both sides of the aisle collaborating is a good one for DERs.)

One key element of Chatterjee’s policy work to advance opportunities for DERs and VPPs will be pushing for compliance implementation of FERC Order 2222. “I’d like to see potentially eliminating that [state] opt-out as a way to better enable 2222 to take hold,” he said. 

Despite potential policy changes, Chatterjee is optimistic about the company’s fate in an administration likely to be extremely pro-fossil fuels. The AI challenge, he said, is so great that it can overcome emotions and identity politics that would otherwise pose a risk to the clean energy technologies that VPPs rely on.

“It hasn’t happened yet, because I don’t think it’s upon us yet, ” he added. Chatterjee expects instead that forced compromise is on the horizon because AI dominance is becoming more important than all else — including the energy transition. 

“On the political left…they’re going to have to recognize that winning the AI race for national security purposes means that they may be disappointed if we backslide on our decarbonization goals,” Chatterjee said. “And on the political right, it’s going to be a recognition that we can’t possibly meet this surge in demand with fossil fuels alone, so we’re going to have to embrace clean energy and embrace VPPs and demand response and energy efficiency. I truly believe it is a significant enough challenge that it will alter the dynamics.”

As the nation's regulator of both electricity sales and transmission, FERC will inevitably be on the forefront of many of the policy changes to come. But as to Chatterjee's conversations with the Trump team about making cuts at his former agency? “Not gonna get into that.”