PSEG is planning to bring major changes to the Long Island Power Authority’s electric service, according to newly named PSEG Long Island President Davy Daly, following LIPA’s much maligned response to outages caused by Hurricane Sandy.
Daly said at a breakfast meeting Friday that PSEG’s takeover of Long Island’s electrical operations from National Grid, set to begin Jan. 2, would include efforts to improve storm response, customer service and reliability of service.
“You cannot turn around an operation like this on a dime,” Daly said.
LIPA, the state authority which oversees power and gas lines on Long Island but subcontracts out its direct operations to full-service utilities, was blasted by state and local officials for its response and communications after Sandy. Gov. Andrew Cuomo signed legislation in July turning over operations to PSEG and reducing LIPA to a holding company with a smaller staff, after a Moreland Commission report found flaws in its previous structure.
While PSEG will run the utility’s electrical service, National Grid will still control gas operations.
At Friday’s press conference, PSEG Long Island pledged that it would institute a three-year rate freeze, earn a top 25 percent customer satisfaction ranking within five years and raise customer satisfaction within the first year of the takeover.
Daly said PSEG’s contract will remove “blurred lines” that plagued LIPA’s deal with National Grid and divided responsibility between the two companies.
PSEG Long Island will improve on LIPA’s investments on tree trimming, wood poles and substations – areas Daly said can cause problems with storm response if not properly maintained.
LIPA’s response to Hurricane Sandy was widely criticized, with some North Shore communities facing nearly two weeks of blackouts and public officials decrying what they described as vague and inaccurate information from the utility.
PSEG said the implementation of its storm outage management system, which would replace LIPA’S 30-year-old approach, will help fix those problems for future storms.
LIPA’s system is not able to “adequately respond to major storm and does not give the utility the ability to plan its response,” Daly said, while touting PSEG’s efficiency in managing logistics and increased staff levels following Hurricane Sandy.
In LIPA’s handling of Hurricane Sandy, communications went through the central LIPA office while the actual repair work was done by National Grid and hired contractors. The split in responsibility frustrated some local officials, who said in the days following the storm that there was a disconnect between workers on the ground and LIPA’s communication’s team.
PSEG would assume both operational and communications responsibility under the new contract, and in their presentation promised that their outage management system “provides real-time information and speeds up customer restoration time” and will allow the utility to better track outages and crews.
“Without this system it is impossible to do this,” Daly said.
Daly also said PSEG has a multi-year plan to raise substations two feet above flood levels for a 500 year storm plus two feet, and that the company will receive an automatic 10- year contract extension if it meets LIPA’s performance metrics.
PSEG also plans on increasing investment in tree trimming by 30 to 40 percent, according to the presentation.
The new PSEG venture plans to benefit from LIPA’s status as a public authority. According to the presentation, the IRS is in the process of ruling on whether LIPA will stay tax exempt, and full implementation of the utility’s rebranding is dependent on that ruling.
PSEG Long Island said it will also make an effort to reach out to Long Island residents, including holding town halls across Long Island and the Rockaways in November and December, sending a letter with details of the plan to all customers and advertising on local television stations.