Bloomberg News

Long Island Power Authority Sued Over Hurricane Sandy

November 13, 2012

New York’s Long Island Power Authority and National Grid Plc (NG/), which operates the utility’s electricity network, were sued over their Hurricane Sandy response while about 45,000 of LIPA’s customers remained blacked out two weeks after the storm.

Two customers accuse LIPA of failing to provide electric services because of its “disregard” in management and maintenance of equipment, facilities and personnel and its “failure to replace an outdated, obsolete outage management system which lacks the ability to manage large-scale outages,” according to a complaint filed today in New York State Supreme Court in Nassau County.

“LIPA’s failure and omission to provide electric services to plaintiffs and residents was occasioned by the fact that LIPA neglected vital maintenance, including, but not limited to, tree trimming and electric/transmission pole inspections and replacement,” the plaintiffs said in the suit.

Sandy made landfall on Oct. 29, bringing 85 mile-per-hour (137 kilometer-an-hour) winds and record-setting floods to New Jersey and New York. The hurricane and a subsequent snowstorm on Nov. 7 knocked out power to 8.66 million customers in 21 states, including about 2 million in New York, according to the U.S. Energy Department.

LIPA, based in Uniondale, New York, had restored electricity to 99 percent of customers, or about 1.1 million, who could safely accept it of as 10 a.m. local time, according to its website.

Homes, Businesses

The state-owned authority’s customers accounted for about 53 percent of an estimated 106,000 still without power yesterday, including homes and businesses with property damage that were unable to reconnect, according to data compiled by Bloomberg from utility websites.

New York Governor Andrew Cuomo today said he convened a commission to investigate utility companies for what he said was their failure to properly prepare for the storm.

The probe will look into how utilities responded to Sandy and tropical storms Irene and Lee last year, according to a statement e-mailed today. The review will be conducted by a so- called Moreland Commission, which under a 105-year-old state law has the power to subpoena witnesses and documents, hold hearings and administer oaths.

National Grid, based in London, operates and maintains LIPA’s power grid under a contract that expires at the end of next year. The authority last year approved a new contract under which Newark, New Jersey-based Public Service Enterprise Group Inc. (PEG:US) will take over operation of its Long Island grid on Jan. 1, 2014.

‘Our Focus’

“We are aware of the lawsuit, however our focus continues to be on those most affected by the devastation caused by Hurricane Sandy,” Karen Young, a spokeswoman for National Grid, said in an e-mailed statement. “We continue to work with local officials and relief agencies to provide ongoing support to those communities and to be there for our customers.”

LIPA’s media relations department didn’t respond to an e- mail seeking comment on the lawsuit.

Customers claim in the complaint that the utility “grossly under-budgeted” for responses to storms with large-scale outages, didn’t reconfigure substations to minimize flood damages and used “rudimentary storm and damage prediction models.” The lawsuit, filed as a class action, seeks unspecified damages.

The utility’s outage management system works on a 25-year- old mainframe computer that uses an “obsolete computer program language,” and its engineers used highlighted paper maps to track thousands of outages, according to the complaint.

‘Rendered Unusable’

The utility also failed to use a real-time distribution and outage management system, and was unable to communicate because its call centers -- which rely on customers to report outages -- were “rendered unusable by the public,” according to the complaint.

“LIPA failed to give plaintiffs and residents accurate estimates on when their power would be restored using an online map which showed more outages than there were customers and featured inaccurate recovery information,” according to the complaint.

LIPA also failed to tell customers until a week after the storm struck that inspectors would need to examine electrical panels in flooded homes before it could restore power, according to the complaint.

‘Unified Message’

A report by the state’s Public Service Commission issued in June on LIPA’s response to Tropical Storm Irene last year urged the utility to improve communications with the public, collaborate with municipalities to “provide a unified message” during and after emergency events and to reevaluate and improve vegetation management and tree-trimming policies.

More than 523,000 LIPA customers lost power from Irene, which struck on Aug. 28 last year, according to the state report. The storm cost the authority about $171 million and left some customers without power for more than a week.

The case is Mollins v. Long Island Power Authority, 602288/2012, New York State Supreme Court, Nassau County.

To contact the reporter on this story: Chris Dolmetsch in New York at cdolmetsch@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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