For six years, PSEG has bragged on its procedures and systems, promising Long Island customers that the company that replaced National Grid after a disastrous Sandy response was ready for anything.
In 2015, then-PSEG Long Island president David Daly said he was very confident that when the next big storm hit, PSEG’s updated call center and outage management system would ensure a more reliable grid and swifter response.
Over the past week, it didn’t.
The devastation of superstorm Sandy brought help to the Island’s power system, starting with $729 million in federal funding to harden the grid. PSEG, a New Jersey-based company that has a 10-year contract with LIPA to operate Long Island’s system, said this money and rate increases that started in 2016 would be used to:
- Replace older poles with thicker ones able to withstand 135 mile-per-hour winds.
- Replace old lines with stronger ones.
- Raise substations to clear 12 feet of floodwaters.
- Create a mobile phone app that would provide crews with a modern outage management system, banishing paper maps and work orders.
- Beef up the communications system for customers, with new protocols and ways to report outages to include social media apps and texting.
- Establish more aggressive tree-trimming, with a budget nearly doubled to about $35 million annually, allowing more frequent trimming and creating a larger clear area, eliminating limbs up to 12 feet above lines, 10 feet below them and eight feet on either side.
Achieved, or not?
PSEG has claimed it achieved most of this, and its confidence went largely unchallenged, mostly because the system went largely unchallenged, with the region having weather luck since Sandy hit in 2012.
And when it became clear Isaias was bearing down on Long Island last week, PSEG Long Island’s current president, Daniel Eichhorn, promised his organization was ready.
PSEG says it was way ahead of the game in securing outside crews. And it did predict the number of outages, some 400,000, fairly accurately.
But the touted communications system was a disaster, with customers unable to get help with or even acknowledgment of their complaints, whether they were reporting outages or live wires sizzling in yards. Even customers who, for medical reasons, need electricity to live, could not get power back, or find out when they would. That’s inexcusable.
PSEG started off by blaming Verizon for the communications problems, and promised that while the company knew the text, call and online mishaps were frustrating, they had no effect on power restoration. The company claimed that thanks to smart meters and other sensors, it knew what needed to be done, and would have nearly everyone back online by Saturday at the latest.
Once again, that wasn’t the case. Even on a Monday afternoon conference call, Eichhorn said 50,000 customers were still without power, but claimed only 13,000 were outages original to the storm, with the rest caused by subsequent work or problems. And many still had no idea when service would return.
Utility customers in New Jersey and Connecticut are also having trouble getting answers and power, which suggests PSEG’s issue isn’t purely incompetence. Eichhorn says more workers have been brought in, with a total of 5,600 now addressing outages and related work. But the braggadocio of overpromising and underdelivering, magnified by overconfidence in its weather modeling and new equipment and procedures, is an indefensible and unforced error the company made twice. It assured Long Islanders that we now have a foolproof communications system and a vastly hardened grid. When communications failed after Isaias, it needed to manage expectations better about when service would resume. At that point, it needed to answer the phone calls from angry ratepayers who had received automated messages that were inaccurate.
Hard questions ahead
Now come the questions, the investigations and the consequences. Gov. Andrew M. Cuomo has issued threats, including a franchise revocation. The Public Service Commission can issue fines. State Attorney General Tish James, the state Senate and the Nassau County Legislature have promised hearings. LIPA has set up a timeline for accountability and improvements before the next storm comes up the coast. Making sure we are ready as soon as possible for the next weather event is the priority. And at some point, LIPA will have to answer questions directed at it about whether its oversight of PSEG is adequate.
Did approximately $1 billion in spending do no good? Is the grid hardened, and trees properly trimmed? Have the communications system, website and outage map never been tested against the stress of thousands of calls and inquiries in dry runs? Is there no high-priority method by which customers with emergencies, like live wires down or respirators that need power, can get through?
And what will happen when a monster storm hits?
Much of PSEG’s compensation comes in the form of performance incentives tied to customer satisfaction, regulatory performance and financial performance. In 2019 it earned 100% of the possible $9.81 million in potential bonuses. In 2018 it earned 100% of the $9.66 million available. The evaluation and payout for 2020 should make for fascinating reading.
We had confidence in PSEG but the company failed to perform. Worse, it failed to assess its ability to perform, which will make the trust it lost terribly difficult to regain.
— The editorial board