The last time he had the gavel, Chairman Neil Chatterjee earned a reputation at the Federal Energy Regulatory Commission (FERC) as the president's "coal guy."

Now, as he takes the top seat at the nation’s electricity regulator once again, observers from across the power sector are talking about a change in Chatterjee​.

"I think Neil has a much more granular understanding of the Commission and its issues than he did when he started," Mike McKenna, a consultant who led President Trump's transition team for the Department of Energy, wrote in an email. "If you think about it, he was really thrown into the briar patch at the beginning, and this assignment is not a particular pleasant or timely one either."

Chatterjee's stint as acting chairman last year raised eyebrows for a short-term coal and nuclear bailout he proposed and a series of political statements that called into question FERC independence from the White House.

In recent months, however, observers say he's refocused on emerging energy technologies and the technical aspects of FERC regulation.

"I think he genuinely appreciates new technologies and innovation including renewable energy and storage," said Rob Gramlich, a consultant and former staffer for ex-FERC Chairman Pat Wood III. "He listens well, is well informed, and has been saying the right things about FERC's independence lately."

That new focus has grabbed the attention of a number of industry players with business before FERC.

"Chairman Chatterjee appears to be speaking with more authority in the past month," said Devin Hartman, president and CEO at the Electricity Consumers Resource Council, a lobbying group for large power consumers. "He has become a more vocal leader on policy issues like removing market participation barriers to energy storage, which America's manufacturers applaud."

"It's not gone unnoticed that to his credit he's shown that he understands the depth and breadth of responsibilities as a commissioner of an independent agency, including being the chairman," said a separate senior industry official, who asked not to be identified so they could speak freely despite a working relationship with the commission.

But as they applaud Chatterjee's newfound independence, many sources also preach caution about the once and current chairman. Even if he does not push a Trump-style bailout for coal and nuclear plants, Chatterjee and his colleagues could still boost payments to those generators through a number of pending cases at the commission.

"People who get to regulatory Commissions from political roles don't tend to forget who put them there," Gramlich said. "At FERC you can't be friends with both sides of an issue for very long because before long you'll have to vote under statutorily imposed deadlines."

A political past

Chatterjee, a former staffer for Senate Majority Leader Mitch McConnell, R-Ky., first took the gavel at FERC in Aug. 2017, when Trump named him acting chairman at the end of a six-month spell without a quorum at the commission. Chatterjee's office declined a request to be interviewed for this story.

Chatterjee's tenure as acting chair was supposed to be short — only until energy lawyer Kevin McIntyre, Trump's chairman pick, was confirmed by the Senate — but delays in the confirmation process and McIntyre's subsequent treatment for brain cancer meant Chatterjee's chairmanship stretched until December.

During that time, the Department of Energy (DOE) filed a coal and nuclear bailout plan at FERC, proposing that electricity customers pay to keep plants with onsite fuel supplies open.

The request was widely panned in the power sector, and Chatterjee's first instinct was to find a compromise. In November, he floated a short-term subsidy proposal that would keep coal and nuke plants open while FERC studied the issue further.

That plan ruffled feathers at the commission because Chatterjee released it to the press before notifying fellow regulators and their staffs, a break with convention at the typically insular FERC. Those concerns deepened the following day when Chatterjee was asked why he chose that strategy.

"I studied for eight years under the master of getting these things done," he said, alluding to his time as a McConnell staffer.

Though he eventually voted against the DOE's proposal in January, Chatterjee's compromise plan and his comments were unusual for a regulator at FERC, an independent agency whose members and staffs typically avoid political statements. He also received criticism for social media posts mocking pipeline activists that disrupted a FERC meeting, particularly actor James Cromwell.

"Come at me bro!" Chatterjee wrote on Facebook in response to a post from Cromwell.  

A 'natural transition'

Now, Chatterjee is moving into the chairman's office again after McIntyre announced last week that he would step down due to health issues.

In the intervening months, observers say Chatterjee has tamped down political rhetoric in an attempt to rebrand himself as a more serious regulator.

"He's trying to disprove the critics and show that he's capable of handling the job," said the senior industry source, "Obviously by being re-designated the chairman, he's certainly shown the right people that he's grown in the job."

"He's learning that he cannot say things on Facebook about people who come into the meetings," said a separate senior industry source who also asked not to be identified because of a working relationship with the commission. "I think he's understanding the gravity of the situation and that you need to keep those thoughts sort of separate from the day-to-day job."

Part of the change in Chatterjee's rhetoric could be the product of growing into his new role as a regulator, sources said.

"I don't know if it's as much as a change as really settling into the role of being a commissioner and moving away from the political lifestyle," said the second source. "I think we're almost seeing a natural transition of someone who was active in politics just becoming more of a regulator."

Chatterjee's shift has not just been about talk. In recent months he has focused on pipeline cybersecurity and energy storage, two emerging areas of FERC concentration that have won favor with parts of the energy industry skeptical over his stance on coal and nuclear issues. In February, FERC unanimously approved a landmark energy storage order that he helped shepherd through the commission.

"He went in talking so much about the storage role and that really is his brainchild, his baby," said the second source. "It's been incredible. I think he was very proud to see that, make it to the finish line."

Still, some say the impression of Chatterjee as a political actor was always misguided, and more attention should be given to his votes, rather than his rhetoric.

"I think it's a misperception on, on people's part," said former FERC Chair Jon Wellinghoff, a Democrat appointed by President Obama. "He is in the office as an independent regulator and you have to judge the man by his actions and what he's done so far."

Despite their differing political backgrounds, Wellinghoff was an early supporter of Chatterjee and advised the current chairman during his nomination process last year.

"I think he really understands the value of markets and the value ensuring that these innovative technologies have an opportunity to participate in those markets in a full and robust way," Wellinghoff said.

Trust, but verify

Amid optimism about the new chairman's shift in tone, sources stressed caution about a number of pending issues at FERC.

In March, Trump directed DOE to design a new coal and nuclear bailout plan after the failure of its first proposal at FERC. Though the plan is reportedly on hold at the White House, its release could involve the commission in setting payment rates for plants, depending on the strategy chosen.

A new addition to FERC could make it more receptive to such a plan. Early this month, Trump nominated DOE official Bernard McNamee to fill a vacant seat at FERC. McNamee was on the agency team that designed the ill-fated bailout plan, and how he and Chatterjee would respond to a new plan from the White House that nominated them remains an open question.

In addition, a number of longer term electricity market reforms could also boost payments for coal and nuclear plants. FERC currently has dockets open to reform capacity markets in PJM and ISO-New England, as well as design new market rules for grid resilience. The solutions they they approve will have a significant impact on which plants survive, and for how long.

"Many potential reforms under the banner of reliability and resilience actually hurt consumers," Hartman said. "For example, we should be asking if generator performance incentives are sufficient and efficient, not whether we need prescriptive capacity market changes that remove supply- and demand-side resource flexibility."

Chatterjee will also have some lingering personnel issues to deal with as chairman. Former staffers have called for FERC Chief of Staff Anthony Pugliese to step down over a series of political comments this year. Chatterjee hired Pugliese last year during his time as acting chairman and Pugliese stayed on during McIntyre's time with the gavel.

The new chairman's task will be to balance the multiple policy and personnel issues facing FERC with "the appropriate deference he will and should give to the former chairman," McKenna said.

Political pressures are unlikely to subside, but Wellinghoff said the commission's independent status will give Chatterjee, McNamee and the rest of FERC some breathing room to make policy, regardless of what the White House wants.

"Once you become a commissioner, nobody can touch you unless you are engaged in malfeasance of office," Wellinghoff said. "It's very difficult to pressure those independent regulators to move in directions that they don't want to move, and so it will come down to what their personal philosophies are about energy policy in the country and how they want to pursue it."