Who Regulates Energy Companies in the United States?
Introduction to the Regulatory Agencies that Oversee the U.S. Energy Industry
At the federal level, the U.S. Department of Energy (DOE) has the broadest responsibilities in regulating power generation and electric transmission, distribution, and retailing across the country. Additional regulatory bodies handle specific aspects of the energy and electricity industries in the United States, including safety regulations and enforcement. The bodies are either independent -- created by federal law -- or part of government agencies themselves.
The Federal Regulatory Agencies
The Federal Energy Regulatory Commission (FERC), Nuclear Regulatory Commission (NRC), Bureau of Ocean Energy Management (BOEM), National Institute of Standards and Technology (NIST), and Office of Surface Mining Reclamation and Enforcement (OSM) provide varying degrees of regulation and oversight over energy in the United States.
The Federal Energy Regulatory Commission
The Federal Energy Regulatory Commission (FERC) came into existence as a result of the Federal Power Act of 1920. The Energy Policy Act of 2005 expanded its responsibilities. The independent commission provides oversight for the natural gas, electricity, and oil industries. Some of the organization’s responsibilities include, but are not limited to: regulating interstate wholesale electricity agreements, reviewing proposals for electricity projects, providing licenses and inspecting public- and private-sector electricity plants, monitoring electricity markets and enforcing regulations, especially when violations occur. But the FERC does not get involved in retail energy sales. The commission also does not involve itself in power-plant construction issues at the local level.
U.S. Nuclear Regulatory Commission
The U.S. Congress created the NRC in 1974 by the Energy Reorganization Act to oversee the country’s growing nuclear energy industry. The commission -- armed with $1 billion budget -- regulates public- and private-sector creation of nuclear energy and use of nuclear materials. NRC licenses, inspects, and regulates nuclear power plants and reactors. The commission also regulates nuclear waste and uranium mining. Five commissioners approved by the U.S. Senate lead the NRC, which is headquartered in Maryland and has offices in four states. NRC collaborates with federal and state governments to enforce all laws related to nuclear energy.
Bureau of Ocean Energy Management
The Bureau of Ocean Energy Management (BOEM) sits at the forefront of maritime energy exploration and mining in the Gulf of Mexico, Alaska, and the Pacific regions. The bureau oversees issues related to energy independence and economic development in these regions. Environmental protection is one of BOEM’s key focus areas, as its mission is to manage the marine environment and the mineral resources it contains. BOEM’s director is an appointee of the secretary of the interior. The director and senior executives oversee the implementation and management of ocean-based energy projects. Additionally, the bureau is responsible for oil and natural gas leases, environmental reviews and other renewable energy activities. BOEM maintains offices in Louisiana, California, and Alaska.
Office of Surface Mining Reclamation and Enforcement
The Office of Surface Mining Reclamation and Enforcement (OSMRE) regulates surface coal mining and related environmental issues in the United States. The bureau, part of the U.S. Department of the Interior, was created by the Surface Control and Mining Act of 1977. One of OSMRE’s principal responsibilities is to work with Americans at the local level, including tribes when applicable, to ensure land and water-quality restoration upon completion of mining projects. The bureau no longer works in an enforcement capacity as mining companies have robust internal programs to ensure legal compliance.
National Institute of Standards and Technology
The National Institute of Standards and Technology (NIST) has been around for more than 100 years. The institute, founded in 1901, is an agency within the U.S. Department of Commerce. NIST promotes scientific innovation in a wide range of areas including energy production, nanotechnology, and computer chips. The institute sponsors research and provides business assistance. NIST also promotes an excellence program to recognize achievements in the core areas it supports.