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Officials detail 'damages' LIers suffered from PSEG storm response

PSEG employees work to restore power in Lake

PSEG employees work to restore power in Lake Ronkonkoma in August.  Credit: James Carbone

Public officials recounted the hardships Long Islanders faced during more than a week without power following Tropical Storm Isaias at a forum Tuesday, with some expressing concern about lingering PSEG system problems and LIPA’s ability to provide proper oversight.

Testimony from ratepayers about "potential harm" suffered as a result of PSEG Long Island’s missteps around the storm will be used by the state to determine the utility’s best path forward, according to Rory Lancman, the state’s special counsel on ratepayer protection.

In an interview in advance of the forum, Lancman said testimony will "hopefully inform our own judgement of what sort of resolution there should be between PSEG and LIPA, and what’s the best path forward for LIPA as an entity."

LIPA is already considering terminating its contract with PSEG and becoming a fully public power authority. PSEG has said it believes the current public-private partnership works best, and that it’s worked hard to implement LIPA and state recommendations identified in investigations in the aftermath of the storm.

State Sen. Anna Kaplan (D-North Hempstead) said her office became a "de-facto call center" for PSEG during the restoration phase, helping 731 ratepayers to get their lights back on, including dozens with medical emergencies and 66 with live wires down on their properties. Losses included those like a staff member who lost power for around two weeks who had to spend over $1,000 to stay at a hotel during the outage.

Since the storm hit Aug. 4, LIPA and public officials have been blistering in their criticism of PSEG after more than 535,000 customers lost power and many were left in the dark for more than a week. Computer and communication issues hamstrung the utility, leaving millions of calls and text messages unanswered, while creating the logistics nightmare of PSEG sending trucks out for repairs that, in around a third of the cases, weren’t needed.

LIPA last month filed a $70 million breach of contract lawsuit against PSEG. The testimony from Tuesday's forum and other ratepayer information will likely be included to show "what has been the harm of the failures that LIPA alleges PSEG committed," Lancman said.

But it wasn't just PSEG failures that were addressed in the forum. Brookhaven Town supervisor Ed Romaine raised the issue of LIPA’s failed oversight of PSEG in advance of the storm.

"People are throwing a lot of rocks at PSEG and rightfully so, but what about the people who are paid to have oversight of PSEG: what about LIPA?"

Romaine said he supports a "total revamping of the utility," not just of PSEG’s role but also LIPA’s. He said he supports full municipalization of the utility.

Sen. Jim Gaughran (D-Northport) recounted problems of ratepayers and agreed that LIPA "totally failed" in its oversight of PSEG in saying there "has to be a total review and change in the way we are providing electric service on Long Island."

While Lancman said his primary aim is to inform the damage caused by the utilities failures, he’s also making sure that the agencies that oversee them, including DPS are looking internally at their own oversight responsibilities. DPS has a "review and recommend" authority over LIPA/PSEG and, like LIPA itself, is supposed to make sure the company is making good on its service pledge.

"I’m here to make sure all the agencies of government and the entities we regulate and contract with are improving the way they do things to that … ratepayers across the state get the service they are entitled to," Lancman said. "There’s nothing wrong or unhealthy with government agencies examining their own performance while at the same time holding accountable the entities they regulate."

During the forum, state Sen. Todd Kaminsky (D-Long Beach) said the overarching concern was the fact that many of the problems remain unaddressed.

"What concerns me most is that right now we still don’t have a functioning system," he said of computer and telecom problems. Another major storm could "happen next week" and there is "no way to handle widescale outages. That’s troubling and it's dangerous."

PSEG spokeswoman Ashley Chauvin said the comapny "remains committed to being the service provider" for LIPA, adding, "We are working diligently with LIPA and the DPS to address their recommendations, and to regain their trust and confidence."

PSEG took over in 2014 after National Grid/KeySpan also came under withering criticism for its response to Superstorm Sandy. Gov. Andrew M. Cuomo in 2012 formed a Moreland Commission to review utility performance, and initially considered fully privatizing LIPA, before agreeing to move forward with PSEG, as LIPA trustees had intended. Cuomo’s administration was instrumental in negotiating a bigger contract with more responsibilities for PSEG than trustees had initially intended.

Lancman said while LIPA considers breaking off from PSEG in a fully municipal model, he will also be looking at "very substantially revising what [an] appropriate and effective operating agreement with PSEG would be that would enable LIPA to better manage and oversee PSEG," he said. "That’s something that is a big focus of our attention right now."

By March, Lancman said, LIPA will either "get the contract it wants with PSEG that it feels is necessary, or get rid of PSEG and just provide those services" itself.

He said the Department of Public Service, the administrative arm of the Public Service Commission, is "overseeing and involved in every aspect of that decision making." Either way, he added, "The governor is going to make sure that ratepayers are protected and get the best deal."

Not all who spoke at the Tuesday forum were completely critical of PSEG. Glen Cove Mayor Tim Tenke said the up to 80% of the city lost power as a result of the storm. "It was very tough and there were a lot of angry people," he said, including many who were told their power was restored even though they remained in the dark.

But since then, Tenke said, "their responsiveness has changed." After a power outage in December PSEG was "very responsive"

"I'm hoping lessons learned from Isaias will translate to future improvements, which I've already seen," he said.

But LIPA chief Tom Falcone noted that failed outage management computer and telecom systems, reported by PSEG to have been fixed, "do not work to this day." He called PSEG's performance, which he blamed on PSEG management, "unacceptable" to LIPA, the board, and customers.

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