LIPA board spars with PSEG exec on transparency, urgency

PSEG Long Island’s top official pushed back against charges that the company lacks urgency and honesty in its efforts to probe and fix problems exposed in the aftermath of Tropical Storm Isaias during a sometimes testy LIPA board meeting Wednesday.

Meanwhile, PSEG said it has largely fixed telephone and most computer problems that led to a series of cascading failures during and after the storm, and it plans to comprehensively test the combined systems in coming weeks.

At a special session of the LIPA board Wednesday morning, trustees raised concerns about PSEG’s transparency, how quickly and seriously it was responding to LIPA's reform requests, and the origin of "glowing" endorsement letters submitted to the state by PSEG contractors.

PSEG officials said it has resolved design and capacity bottlenecks with telephone systems that failed during the storm and that they had passed stress tests that exceed call volumes experienced during the storm. "We are in a very good position right now with our phone system," PSEG Long Island chief operating officer Dan Eichhorn said.

During and after the storm, more than 535,000 customers saw some 645,000 outages, and many were frustrated for a week or more trying to get restoration times and responses from PSEG. A LIPA task force found PSEG had been experiencing problems with their outage management computer system months before the storm, and saw bottlenecks on the telecommunication system.

An older version of a computer outage management system vital to storm response continues to be tested and improved, Eichhorn said, even as PSEG works on a parallel track to implement a new version of the system with new hardware, to be ready by late summer.

LIPA board members, who will vote on whether to continue with PSEG or convert to a fully public utility by the end of March, continued to raise questions about PSEG’s claims and progress.

"My biggest concern has been the transparency," LIPA vice chairman Mark Fischl said. "As I understand it, PSEG knew the outage management system didn’t work before the storm but didn’t reveal it to LIPA or staff. Can you help me understand that better?"

Eichhorn countered, "Nobody intentionally hid any information."

"If we knew those issues were existing they would have been brought forward," he said. A LIPA task force report showed internal PSEG emails in which a PSEG supervisor wrote weeks before the storm that the computer system was "not even managing on a day to day basis, and we are definitely NOT prepared for a weather event."

"There’s things that happened in Isaias that definitely, individually we’ve dealt with, and things that we weren’t happy with," Eichhorn said. "But to paint the organization, that we can’t be trusted and we need to be micromanaged, I don’t agree with that."

LIPA chief executive Tom Falcone took umbrage with Eichhorn’s characterization.

"While these IT [computer] problems are important, ultimately it was a management issue, and I take it as somewhat dispiriting that Mr. Eichhorn referred to accountability, transparency and oversight as micromanagement," Falcone said. "I don’t agree. I think we need real contract reforms and contract changes that give everyone the confidence to move forward after such a management failure."

LIPA also detailed a list of new contract demands sent to PSEG last week — demands it says must be met in order to move forward with the company. PSEG said it is reviewing them "with an open mind." LIPA wants PSEG's Long Island managers to all report to a chief officer dedicated to Long Island, not reporting to New Jersey, and wants more of a say in hiring, firing and pay, among other things.

LIPA trustee Sheldon Cohen said, "I am not feeling a sense of urgency on the part of PSEG Long Island. ….I hear the baby steps that are being taken [but] I’m just not feeling the sense of confidence that we’ll be in the best position March 24 to make a decision that I think PSEG might be hoping we’ll make."

LIPA’s board is expected to meet March 24 to decide whether to continue with PSEG or go fully public.

Falcone said LIPA itself was doing "a lot of soul searching about how we missed this" and announced a series of new oversight measures LIPA will institute as a result. "We relied too much on PSEG’s representations," he said. "So we won’t do that anymore."

Trustee Drew Biondo questioned Eichhorn on letters and comments of endorsement that have been submitted on PSEG’s behalf in a state proceeding that is looking into potential customer damages from its storm failures.

"Did PSEG solicit comments from elected officials and vendors for the PSC hearing seeking glowing recommendations?" Biondo asked, noting many "shared similar sentiments and language."

Eichhorn acknowledged, "We’ve talked to people when they’ve asked us if they can do anything to help," but said he wasn’t aware of "any campaign where we went out and talked to the 100 officials you mentioned."

The trustee meeting included a period for public comment, and nearly all who spoke endorsed a fully public LIPA cutting ties to PSEG.

Fred Harrison, a ratepayer from Merrick who is a member of Long Island’s Food and Water Action environmental group gave the four companies that have operated the LIPA system since its LILCO days failing marks, adding the alternative of a fully public LIPA has "always been clear," he said. "Why would we continue with PSEG under any circumstance?"

Among letters submitted as part of the comments process was one from the head of Local 1049 of the International Brotherhood of Electrical Workers, which rarely scuffled with PSEG in contract negotiations.

"Although we agree that there were various issues during Tropical Storm Isaias and the response plan to power outages, we are totally committed to working with PSEG-LI and LIPA so that they can come to terms for a new beginning of increased transparency, accountability and excellence," said the letter, signed by business manager Patrick Guidice.

By Mark Harrington

mark.harrington@newsday.comMHarringtonNews

Mark Harrington, a Newsday reporter since 1999, covers energy, wineries, Indian affairs and fisheries.