PSEG-LI customer satisfaction score plummets after Isaias

PSEG Long Island, which has long billed itself as the nation’s most improved utility, saw a sharp increase in its state complaint rate and a sharp fourth-quarter drop in its JD Power customer satisfaction score following missteps during Tropical Storm Isaias.

Surveys of residential customers after the storm show PSEG’s score for operating the Long Island power grid dropping precipitously, though not as low as in 2014, when PSEG's predecessor, National Grid, received the worst score in the nation for its operation of the LIPA-branded utility after Superstorm Sandy.

In the October through December period, PSEG Long Island's JD Power residential customer satisfaction score dropped to 664 of a potential 1,000, a PSEG official reported last week, after reaching a high of 746 for the first six months of the year. For the full year, PSEG will still see a gain to a projected 717, up from last year’s 695.

"I’m not sugar-coating it, it was bad, 664 was a bad score," Rick Walden, vice president of customer services for PSEG Long Island, told LIPA trustees during a board committee meeting last week. "…I think if we hadn’t had so many outages that would have been helpful in the overall score, but it’s obvious to me that our customers were shaken by the [storm] results, the media coverage of it, which reinforced it to customers who may not have been affected during Isaias, maybe."

He noted, however, that LIPA after Sandy scored worse. In the 2014 JD Power survey, LIPA scored its lowest score ever, 525 of 1,000, a drop from the prior year’s 540 points—all of it tied to failures during Sandy, which left more than 1 million without power, some for more than two weeks.

National Grid lost the LIPA contract in part due to its Sandy missteps. PSEG Long Island, which is being sued by LIPA for at least $70 million over its missteps during Isaias, could also lose the LIPA contract. The state has recommended LIPA terminate PSEG at least by 2025, when the contract ends, or sooner. LIPA is eyeing several potential alternatives, including becoming a fully public power utility.

LIPA, in a statement said, "Customers are understandably frustrated by PSEG Long Island's management failures during Tropical Storm Isaias, and that frustration is directly reflected in the lower J.D. Power customer satisfaction scores."

PSEG also saw its state-monitored complaint rate soar following the storm. The number of customer complaints to the state Department of Public Service jumped to 11.8 per 100,000 customers year-to-date through November, a sharp increase from the 3 complaints per 100,000 logged in the second quarter of this year, and the 4.2 complaints per 100,000 logged in 2019, according to PSEG figures. PSEG had inherited a 10.4 complaint rate when it took over from National Grid in 2014, but worked to steadily lower it to the lowest in the state.

PSEG fared better on its JD Power business customer satisfaction survey, ending the year with a 781 score of a potential 1,000, a gain from the 754 in 2019. But Walden noted that the second-half business score was lower than the first, and that business customers who "had an outage scored us 90 points lower than those who didn’t."

He noted that residential customers were "definitely affected in a more negative way than our commercial customers" in the surveys, but he added, "both were affected and we have a lot of work to do to restore faith in both."

Despite the lower JD Power scores, PSEG may still be eligible to receive an incentive bonus for its 2020 performance, including on the JD Power target, which requires that PSEG get at least a 703 score.

In its scorecard released last week, PSEG indicated it would hit 20 of 27 performance targets for 2020. The company has already given up $6.5 million of its potential incentive pay in 2020 for reimbursements to customers for spoiled food and medicine from Isaias.

It’s unclear whether the company will be filing to receive any incentive pay. . A spokeswoman for PSEG didn’t immediately respond to a request for comment on the prospect that the company could still get some of the remaining $3.5 million in bonus pay.

Meantime, LIPA said it "does not expect PSEG Long Island to receive incentive compensation this year as we look toward significant changes to both oversight and the utility management structure."

By Mark Harrington

mark.harrington@newsday.comMHarringtonNews

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