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PSEG hires consultant in wake of failures during Tropical Storm Isaias

PSEG has hired Gary Lewi in an "advisory"

PSEG has hired Gary Lewi in an "advisory" role as it navigates criticism for its failures during Tropical Storm Isaias. Credit: Gary Lewi

PSEG Long Island has enlisted a high-power communications company in an "advisory" role as it navigates a minefield of criticism for its failures during Tropical Storm Isaias. The move comes as some of its highest-paid contractors take on advocacy roles for the embattled company.

Gary Lewi, managing director for Rubenstein Associates, confirmed Wednesday he’d been hired by PSEG this month to advise the company as LIPA and the state are examining whether to terminate the PSEG contract after a series of technology and management failures during the storm. LIPA and its trustees at a meeting last month accused PSEG officials of "half-truths" and "misstatements" as it criticized the company for lingering problems with outage computer and communications systems. More than 535,000 customers lost power during the storm, many for more than a week.

Lewi stopped short of saying he’d been hired for so-called crisis public relations for PSEG, but said, "Clearly LIPA is the monster issue that’s on the table."

Ashley Chauvin, a PSEG spokeswoman, said Rubenstein will be paid an unspecified fee from the approximately $77 million management fee ratepayers fork over to PSEG each year. Rubenstein will "support communications efforts in an advisory capacity," Chauvin said, adding the firm's fee, "will not impact customers."

Lewi said he’ll provide the company with an "outside voice" that is not part of the PSEG culture to help navigate internal and public perception challenges in the wake of blistering criticism after the storm. . He insisted he did not work with the company or PSEG contractors who recently testified or submitted comments favorable to the company during a Jan. 12 state ratepayer forum on "alleged harm" suffered by customers.

Among the companies that spoke or wrote on PSEG’s behalf in the matter were executives of Asplundh Construction, Green Velvet Tree and Haugland Group, whose chairman and chief executive William Haugland owns a power plant in Greenport that is under contract to LIPA, according to his bio.

Testimony from those contractors, including urging the state Public Service Commission to give PSEG another chance to prove itself, infuriated one LIPA affiliate.

"I think it’s outrageous," said LIPA vice chairman Mark Fischl, who has been particularly critical of PSEG management after investigations showed the company had not told LIPA of problems with an outage management computer system that dogged the company months before the storm, hobbling its response to outages. "It’s a political solution to a real problem."

Added LIPA trustee Matthew Cordaro, a former utility executive who supports converting LIPA to a fully public utility, "It’s not surprising the contractors would support PSEG because they are given these contracts by PSEG and they are managed by PSEG. Cordaro called the comments a "potential conflict of interest."

Among those offering endorsements for PSEG was Michael Forrest, director of electric operations for Asplundh Construction Corp., which has more than a dozen separate project contracts with LIPA, according to LIPA.

"In addition to all the great improvements to the infrastructure and the customer experience, PSEG Long Island continues to give back to the communities within the LIPA service territory," Forrest wrote in a document filed in the ratepayer harm case.

Elecnor Hawkeye, another big PSEG-LIPA contractor, said PSEG’s efforts to "continuously improve" the electric system "exceeded efforts of their predecessors," and called its partner "absolutely the right company to manage the electric grid on Long Island."

Though not a PSEG contractor, Kyle Strober, executive director of the developer group, the Association for a Better Long Island, was among several advocates who implored the state to give PSEG another chance. "Until there is concrete evidence that an alternative management option will both cost less for the ratepayers and succeed in all future post-storm service restorations, we believe that it is in Long Island’s best interest to give PSEG Long Island an opportunity to correct what went wrong," he wrote.

Lewi is also an adviser contracted to ABLI. Strober said Lewi had no involvement in the preparation of the letter.

While most public officials this week were critical of PSEG's storm performance, a handful tempered that criticism with support. Among them was Babylon Town Supervisor and Democratic party leader Richard Schaffer, who in a letter filed with the state acknowledged problems but also asserted it was in Long Island’s "best interest to give PSEG Long Island an opportunity to correct what went wrong."

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