Top PSEG LI execs got bonuses in 2022 as company missed key customer service metrics
PSEG Long Island’s top four executives received bonuses exceeding $130,000 for 2022 — the same year that a new LIPA report says the company missed key customer service metrics.
Total compensation packages for the top seven PSEG LI executives ranged from $442,000 to nearly $700,000 for 2022, according to filings with the state obtained by Newsday.
The pay and performance reports come as a state commission is pondering the future of LIPA as a fully public entity, and the figures may provide fodder for some who say the public-private relationship between grid-owner LIPA and its contractor, PSEG, needs to be scrapped.
In a filing with the state this month, PSEG reported pay packages for the top Long Island executives, including bonuses and "other" perks.
WHAT TO KNOW
- Compensation packages for the top seven PSEG Long Island executives ranged from $442,000 to nearly $700,000 for 2022, including bonuses for four executives that exceeded $130,000 each.
- A new LIPA report shows PSEG is lagging in key performance metrics, including customer service.
- The pay and performance reports come as a state commission is pondering the future of LIPA as a fully public entity.
For example, interim president and chief operating officer Dave Lyons’ total compensation package for 2022 was $699,779, including $275,520 in salary and a bonus of $144,400. The value of his “other” pay was $125,478. The "other" pay category includes long-term incentive grants, special achievement awards, vehicle/housing/mobile phone stipends, relocation costs and a hiring bonus, the filing says.
Meanwhile, a report released Wednesday shows that PSEG scored an overall 70% in fully meeting a list of 96 new performance metrics for 2022, with one of the lowest overall scores (47%) in customer service. Notably, PSEG did not meet JD Power Customer Satisfaction Survey metrics for the year, “indicating that customer satisfaction did not reach the desired level of improvement" in the top 25% of Northeast utilities.
PSEG also failed on all three call-center metrics "due to inadequate leadership decisions, planning and performance management related to the call center," LIPA said in its report.
LIPA vice chairman Mark Fischl said, “It’s disappointing that after delivering these barely passing results for our ratepayers that they [PSEG executives] are getting these huge bonuses.”
PSEG spokeswoman Katie Tatzel, noting that the company is paid a fixed management fee to run the electric system, said, "We target executive compensation to be competitive with other large energy services and utility employers."
As for the performance metrics, Tatzel said LIPA “has not reviewed their response to our metric submission with us” as of Tuesday night, and added, “We are confident that an independent review will show greater success in metric achievement than LIPA is presenting here today.”
The metrics will be reviewed by the state Department of Public Service.
PSEG, after years of declining to publicly release its Long Island division's executive pay amounts, began to report it following passage of a state law in 2021. LIPA, the system owner, always has reported employee and executives pay in accordance with state law.
Among other top PSEG Long Island executives:
- Paul Napoli, managing director and vice president of power markets, received a total pay package of $683,905, including $265,776 in salary and $162,200 in bonus pay. His “other” pay was $113,623.
- Gregory Filipkowski, managing director and chief information officer, had total pay of $667,348, including $323,039 in salary, $130,100 in bonus pay and $195,057 in “other” pay.
- Margaret Keane, the managing director and vice president of construction and operation services, received a total compensation package of $642,468, including $242,658 in salary, $145,300 in bonus pay and $199,063 in “other” pay.
- Michael Sullivan, managing director and vice president of electric operations, had a total pay package of $564,179, including $249,581 in base salary, $90,000 in bonus pay and $126,524 in “other” pay.
- Louis Debrino, managing director of customer operations, had a total pay package of $442,208, including $246,493 in salary, a $90,800 bonus and $73,065 in “other” pay.
- Andrea Elder-Howell, managing director and vice president of legal, received a total pay package of $415,358, including $219,646 in base salary, $98,100 in bonus incentive pay and $87,242 in “other” pay.
The packages also include items such as savings plans, life insurance premiums and a change in value of pension benefits.
The pay packages compensated PSEG executives during a year in which LIPA set in place a list of 96 metrics as part of a new contract to settle a lawsuit over PSEG’s failed performance during Tropical Storm Isaias.
The overall 70% score for the metrics includes an 85% score for transmission and distribution, 78% for power supply and clean energy, 71% for business services and 29% for information technology. Those figures are for fully met metrics.
Overall for the 96 metrics, PSEG met 67, missed 22 and partially met seven, LIPA said. PSEG stood to earn $21.02 million in compensation for meeting those metrics, but LIPA said it is awarding the company $14.8 million. PSEG claimed it was eligible for $16.8 million in compensation. The state Department of Public Service will review the report and issue a recommendation on the final compensation level.
Tatzel said that from PSEG's view, LIPA and PSEG "have a disagreement over only seven of 96" metrics. It's PSEG's position, she said, that "we fully met performance on 75 metrics with five partial, containing 634 total deliverables. We are proud of the work that our employees have done to continue to improve upon our results year after year."
But LIPA in its report on the metrics noted it went out of its way to help PSEG meeting the metrics, including granting “flexibility” and “exceptions."
“The metric outcomes would have been significantly worse if LIPA had not granted PSEG Long Island considerable flexibility and instead adhered strictly to the established metric standards and requirements,” LIPA said in the report, which will be released at a LIPA board meeting Wednesday.
The PSEG executive pay packages were generally up from 2021, when most total compensation packages ranged between $336,389 and $571,737, with the exception of then-retiring PSEG Long Island president Dan Eichhorn, whose package totaled $899,867.
While the salary levels are similar to those of LIPA employees, where the top pay is about $355,000 for the chief operating officer, the PSEG bonuses and other perks nearly double the compensation of LIPA employees.
Mark Harrington, a Newsday reporter since 1999, covers energy, wineries, Indian affairs and fisheries.
