Renaissance man who’s ‘anything but shy’ faces fight for FERC gavel

Source: Hannah Northey, E&E reporter • Posted: Tuesday, September 17, 2013

Depending on whose spin you believe, President Obama’s nominee for Federal Energy Regulatory Commission chairman is either a radical environmentalist hellbent on greening the electric grid no matter the cost or a level-headed energy regulator getting a bad rap.

But friends of FERC nominee Ron Binz — whose confirmation hearing is today before the Senate Energy and Natural Resources Committee — say the man is a lot more interesting than the caricature being drawn by either side.

Binz, they say, is a Renaissance man.

An avid traveler and an expert maker of wine and cheese, Binz, 64, has financed a Colorado vineyard, calls himself a gourmet cook and is said to know a lot about jazz. He managed major medical claims processing for a prominent health insurance company and taught mathematics at the University of Colorado.

What’s more, they say, Binz is a fighter.

The Arkansas native has gone toe to toe with big business to change rules in the wine, telecommunication and energy industries, sources said.

In the late 1980s, he established Colorado’s first office for consumer advocacy, where sources say he stood up for ratepayers amid tumultuous industry changes and made friends in the state Legislature on both sides of the aisle.

“He learns it and knows it. … There’s no doubt Ron will improve your A game,” said Dian Callaghan, who worked with Binz for 12 years at Colorado’s Office of Consumer Counsel. “He’s very persuasive and knows what he’s talking about. … He can change minds.”

Kevin Gunn, a former chairman of the Missouri Public Service Commission and a friend of Binz, said the Colorado regulator got a bad rap as an “enemy of business” because he’s unafraid of going up against powerful interests.

“He’s not afraid of a fight, he’s not afraid of compromise, he’s incredibly knowledgeable and knows what’s going on in the industry; that’s not a bad thing to have,” Gunn said. “You want someone who’s going to be able to go to war when that’s necessary and dial it back when necessary.”

Binz will need to bring his A game to the confirmation hearing.

Nominated to replace outgoing FERC Chairman Jon Wellinghoff, Binz has become a lightning rod, pitting libertarian-leaning groups, the coal industry and some senators — including Sen. Joe Manchin (D-W.Va.) — against clean energy advocates and former FERC commissioners.

His foes say Binz would be key to the Obama administration’s plans to tackle climate change through regulatory actions that end-run Congress. Binz’s agenda, they say, would give all the breaks to wind and solar and elbow out fossil fuels.

Ben Cole, a spokesman for the libertarian-leaning American Energy Alliance, said Binz’s agenda would constitute the “third leg” of Obama’s climate plan, which also includes U.S. EPA’s clampdown on greenhouse gas emissions at power plants and the administration’s limiting of access to federal lands for oil and gas drilling.

Obama’s decision to go around Congress on climate change and Binz’s “troublesome” advocacy for renewable energy sources have sparked a confirmation fight that’s raised the profile of FERC from a sleepy regulatory agency, Cole added.

“I think Binz has been nominated at a moment that presents a perfect storm for the administration,” Cole said. “It’s unique among confirmation battles; most people couldn’t … until recent months even name one FERC commissioner. It would be like trying to name the Cabinet of Andrew Johnson.”

Green groups, meanwhile, have enlisted the public relations firm VennSquared Communications to promote Binz, and a group of former FERC commissioners have shot back at negative Wall Street Journal editorials to back Binz.

If the past is any indication, former colleagues and friends say, Binz will do just fine handling himself. At his side will likely be his partner of more than 42 years, Mary Donahue, who recently retired as a librarian from the National Renewable Energy Laboratory

“He’s anything but shy,” said Rick Morgan, an energy consultant and former commissioner on the District of Columbia Public Service Commission who worked with Binz on climate issues. “He’s very good on his feet. I think we can expect to see him handle himself very well at the confirmation hearing. He’s a master at knowing how to deal with people in all different situations.”

‘Mercedes Binz’

Opponents painting Binz as a renewables radical with a desire to kill coal say the former regulator, if confirmed, would implement costly new regulations to subsidize long-distance power lines that would bolster wind and solar development.

Arguments against Binz center on his implementation of Colorado’s contentious “Clean Air, Clean Jobs” legislation while chairing the Colorado Public Utilities Commission from 2007 to 2011.

The initiative was fought by the Colorado Mining Association and Peabody Energy Corp. The incentives that Binz helped write eventually prompted Xcel Energy Inc. to shutter six coal plants, retrofit others and build more gas-fired generation in the Denver area on then-Gov. Bill Ritter’s (D) watch.

The Colorado Mining Association later filed a petition with the PUC, accusing Binz and his fellow commission members of making “behind-closed-door deals” with Xcel and asking that he recuse himself. Binz rebutted those charges and stayed on the case (Greenwire, July 1).

Libertarian think tank Competitive Enterprise Institute and other conservative groups warned the Energy and Natural Resources Committee in a letter today that Binz “would not be constrained by congressional-mandated boundaries” but would make power prices “skyrocket” as they did in Colorado.

Binz provided fuel for the fire with a comment at a past Edison Foundation event that natural gas will be a “dead end” fuel by 2035 without carbon capture and sequestration.

Another point of contention is a report Binz wrote in April 2012 that supports regulators operating in a “legislative” mode by gathering information to find solutions to future problems. Such language has piqued the concerns of an industry official who accused Binz of “negotiating” Colorado law to create incentives for coal plant closures.

“Such thinking ought to scare the daylights out of Senators from fossil-fuel states because it shows how Mr. Binz will operate at FERC,” stated an editorial in yesterday’s Wall Street Journal. “The supposedly independent agency oversees much of the gas business — from pipelines to export terminals to trading markets. It also has a narrow role to ensure that electricity is affordable and reliable, which Mr. Binz interprets to mean a mandate for whatever his carbon-free paradise requires.”

Steven Hayward, a former fellow at the American Enterprise Institute, in a blog post accused Binz of advocating for a system akin to one in Germany, which provides subsidies for wind and solar. “I think I’ll call him ‘Mercedes Binz,’ since that’s his view of what energy should cost consumers,” Hayward wrote. “His slogan is obvious: Policy uber alles.

But Morgan, who served on the D.C. Public Service Commission from 2003 to 2011, said Binz has been praised for his work in Colorado. Despite negative editorials, he said, Binz is an even-handed regulator and consumer advocate like outgoing FERC Chairman Wellinghoff.

“Groups have come out branding him as being anti-coal; it wasn’t just about coal. It was about a lot of things, trying to bring together a number of interest groups,” Morgan said about Binz’s work in Colorado. “I think he’s very interested in seeing the role of renewables expanded in the electricity and energy business generally, but I think applying it in a thoughtful way.”

Binz worked to build consensus in Colorado while addressing the need to retire old coal plants that were on the verge of having to make major retrofits to meet new EPA clean air standards, Morgan said. Binz understood that further requirements down the road could compromise those plants economically and found a way to bring together diverse groups while protecting consumers, he added.

“It was portrayed unfairly by some in the coal industry, and the Wall Street Journal picked up on that,” he said.

Consumer advocate

Binz’s former colleagues describe him as a peacemaker who doesn’t fear wading into confrontations.

“He’s not afraid of a fight,” said Gunn, the former Missouri utility regulator. “Ron, I think, is viewed among some of the industry as being an enemy of business, but I think that’s wrong.”

After earning a bachelor’s degree in philosophy in 1971 from St. Louis University and a master’s in mathematics from the University of Colorado, Denver, in 1977, Binz entered the master’s program in economics at UC, where he completed 27 hours of graduate work.

But in 1984, when former Colorado Gov. Richard Lamm (D) tapped Binz for the state’s Public Utilities Commission, his nomination was opposed by the state’s largest regulated utilities and defeated in a confirmation vote in the Colorado Senate.

Five months later, he was appointed by the attorney general to serve as the state’s first utility consumer advocate.

Callaghan, who worked as an administrative director under Binz and has been friends with him for 30 years, said Binz helped create the state’s first consumer counsel at a time when ratepayers lacked a voice before the PUC. Binz filled that role until 1995, overseeing more than 200 legal cases before the PUC and other agencies, including FERC.

“Ron was creative and carved out a role for the office,” she said. “It became one of the best agencies in the government.”

Even then, Binz faced opposition.

Telecom companies were pushing to be unregulated at the time, but Binz knew that wouldn’t foster competition, Callaghan said. “The campaign against him was pretty harsh,” she said. “Eventually, members of the General Assembly realized what a resource he was, and that shielded us from being eliminated in our first year.”

Binz has earned a similar reputation in the wine industry.

In 1994, he partnered in financing the Trail Ridge Winery in Loveland, Colo. Binz served on the winery’s board of directors, developing business plans and serving as the winery’s point person for legislative, regulatory and other external affairs.

Binz also served as chairman of the Colorado Wine Industry Development Board and helped move the panel through political turmoil, said Doug Caskey, the board’s current executive director. Binz ushered in rules that have helped the industry’s wine festivals blossom despite disagreement between winemakers and grocers, he said.

“His biggest contribution was solidifying the wine board and getting it through some political turmoil,” Caskey said. “He helped ease us through.”

Supporters say it’s that desire to protect consumers and ability to bring diverse parties together that will shine through if Binz is confirmed.

“It’s a particularly disruptive time for the entire energy industry, and a lot of times political fights have nothing to do with the actual individual being nominated,” Gunn said.