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New LIPA Deal Can’t Promise Less Outages

LIPA and PSE&G working on transition

LIPA CFO Michael Taunton told a meeting of the Nassau County Village Officials Association Feb. 12 that the utility’s transition to a new business model with PSE&G will be “seamless,” but he was unable to offer assurances that the arrangement will mean fewer power outages or quicker restoration of services after a storm.

Taunton said that due to ongoing litigation and the Moreland Commission study, he would not be able to respond to any questions regarding Hurricane Sandy. When the Great Neck Record asked if the new contract foresees less power outages in the future. Taunton did not respond. When told that LIPA has admitted that Great Neck loses power over two times more than the average in other areas, Taunton also did not respond. These figures have been quoted in the Record several times in the past, with that information provided by Village of Great Neck Mayor Ralph Kreitzman, NCVOA president. 

LIPA and PSE&G have been working on the new model for the past year. PSE&G replaces National Grid, which currently has the contract with LIPA. National Grid had taken over from Key Span in 2006, but the National Grid contract expires on Dec. 31, 2013. At the meeting, Taunton did say that the transition will be done on time: “We’ve hit all the milestones.” 

And Taunton noted that, with PSE&G moving the local operation to this area, many new jobs will be available on Long Island, as many as 100 to 125 new local jobs. PSE&G will also assume all of National Grid’s current union contracts and hire most of its workers.

According to Taunton, the new operating business system will focus on customer satisfaction, more transparency and more efficiency. PSE&G will do the actual fieldwork and LIPA will manage the contracts and have many approval rights. PSE&G will monitor the reliability of the system.

During the question and answer period, several Great Neck officials participated. Great Neck Park District Commissioner Dan Nachmanoff, a former Russell Gardens mayor, questioned why LIPA is necessary with PSE&G doing so much. Taunton reiterated that LIPA is in charge of the contract.

Village of Great Neck Plaza Trustee Pamela Marksheid addressed global warming and the increased large storms on the peninsula. Taunton admitted that there is a  “dramatic” increase in the new model.

“number and level” of local storms.

Plaza Mayor Jean Celender, a member of the NCVOA executive board, told the Record that she was “encouraged” by Taunton’s remarks regarding the transition plans and the ongoing reviews and assessments. Mayor Celender also welcomes all of the anticipated new jobs and she feels that the “lessons learned” from hurricanes Irene and Sandy must be “fully integrated” into the new 

Village of Great Neck Trustee Mark Birnbaum told the Record: “Unfortunately with the restraints on his comments, attributed to the pending litigation, there were too many unanswered questions … “ Fellow trustee Jeffrey Bass said that that “the LIPA/PSE&G partnership is born out of LIPA’s inability to understand utility operations …” And Bass questioned if there was even a strategic plan for this joint objective. 

When Plaza Trustee Gerald Schneiderman asked when infrastructure will be improved, Mr. Taunton said he could not answer that question.

The next day, Kreitzman offered the following statement: “I think that Michael Taunton’s explanation of the new operating agreement with PSE&G and how it compares to the current agreement with National Grid was most informative. I am hopeful that the new agreement and working relationship will produce operational, financial and other benefits for us all. Of course, there is the distinct possibility that there will be still other changes from Albany.”