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Source: Long Island Press

Will LIPA and National Grid do better the next time a hurricane hits Long Island?

BY SPENCER RUMSEY

Posted: July 20, 2012
Originally Published: July 19, 2012

Gordian Raacke’s modern two-story white stucco house nestled among the pines in East Hampton pales in comparison to the gaudy mansions of the South Fork but it is a force to be reckoned with.

“Right now we’re a power plant generating power for the neighborhood and the rest of Long Island!” he remarks, pointing to the solar panels on the roof of his car port, where he also keeps a red kayak and stacks of firewood. At the end of the driveway the Long Island Power Authority’s meter shows how many kilowatts are flowing from his property on this sunny, very hot July day.

“We’re on the grid and we want to be on the grid because that solar array makes much more energy than we can use,” Raacke explains.

LIPA gives him about a $20 credit at the end of the year. They used to cut him a check, but he doesn’t mind.

As the executive director of Renewable Energy Long Island, Raacke’s an advocate for renewable energy—think solar and wind—and for using energy more efficiently. He and his wife, Gabriele Raacke, an artist who shows in the Hamptons and Manhattan, built their house themselves in 1993, using the best technology available at the time. The insulation between the walls and under the roof is made of Styrofoam, and it’s so airtight it’s “like having a good down coat over your entire house,” he says.

Although his own energy costs are near zero, Raacke’s home is no different from any household connected to the LIPA grid, so when Tropical Storm Irene rolled over Long Island last August, he lost power just like 523,000 other customers. But unlike the majority, he’s actively committed to fighting climate change by trying to reduce America’s dependence on fossil fuels, one electric bill at a time.

As the former executive director of the Citizens Advisory Panel—the oversight committee set up following the shuttering of the never-powered Shoreham Nuclear Power Plant and its Tax Settlement Agreement, which saddled LI ratepayers with several billion dollars in debt due to the failed project—he doesn’t see LIPA as an adversary but an ally in the transition that he firmly believes must be made as soon as possible.

Concerning local environmentalists, energy advocates and politicians are revelations questioning LIPA’s ability to meet the Island’s growing energy demands as well as resolve criticisms regarding its current management structure, power contracts and emergency response—many of which were detailed in recently released audits commissioned by New York State and Suffolk County.

In the immediate days ahead, Raacke, like every Long Islander, can only hope that during this hurricane season—which lasts until Nov. 30—LIPA and National Grid, the British-based contractor that runs the transmission system and the gas power generation here, won’t repeat last year’s mistakes, which left thousands of customers in the dark for up to nine days, drawing heat from Gov. Andrew Cuomo, who told National Grid after Irene hit on Aug. 28 to “get the power on now!”

Shocking Situation

Long Island elected officials joined in the governor’s denunciation, and their outrage over the outage may have influenced LIPA’s Board of Trustees’ decision last fall to award its $3.9-billion contract to run the electric system to PSEG, a New Jersey-based utility, which will take over from Nat Grid on Jan. 1, 2014. Complicating matters, Nat Grid will still maintain and operate its natural gas and power generation facilities on LI, retaining some 1,200 to 1,300 workers, which adds to the confusion about what will happen when the next hurricane comes and PSEG needs more emergency crews to handle downed electric lines.

“I look forward to working with PSEG,” says Don Daley, business manager for the International Brotherhood of Electrical Workers’ Local 1049, which represents some 2,600 workers. “They have an excellent reputation over in New Jersey with a sister local of ours…. I think what’s important to the ratepayers is that LIPA and National Grid have an agreement with the on-Island gas crews to supplement our electric crews.” He tells the Press it still has to “be hammered out.”

Just last week, U.S. Sen. Charles Schumer held a press conference in Wantagh where a household went five days without power after Irene. Schumer blasted LIPA and National Grid’s “poor performance” in restoring power and urged that the emergency response plans be improved before the next major storm. Citing a recent report commissioned by the state Department of Public Service, Schumer said that Nat Grid and LIPA “were literally executing their offense from two different playbooks… The bottom line is LIPA and PSEG need to have a plan in place to keep the lights on so that Long Island homeowners and businesses aren’t ever again left in the dark for up to nine days.”

In a statement, Schumer said, “Experts predict that there are more regular and intense storm events in years to come, and I remain concerned over the reliability of energy for Long Island residents…. Reliable energy distribution…can mean the difference between life and death.”

LIPA and PSEG issued a joint response following the press conference.

“We agree with Sen. Schumer that a detailed plan needs to be in place to enable safe and swift restoration in the event of a storm,” said a PSEG spokesperson. “As part of our comprehensive transition plan, PSEG will ensure that we have the resources available to handle storms once we assume responsibility for LIPA’s electric system in 2014.”

“To suggest we would leave Long islanders vulnerable to a major storm because of staffing levels is wrong,” said Mark Gross, a LIPA spokesman, in his statement. “Given PSEG’s success of storm planning and procedures and their commitment to improved service for our customers, we will have a storm plan that gives us a robust workforce utilizing all available Long Island resources. Meanwhile, the existing plan with National Grid is still in place.”

Tellingly, Nat Grid did not join in last week’s public relations opportunity with New York’s senior senator.

“From what I understand National Grid pulled out from that,” says Matt Cordaro, a former top executive at the Long Island Lighting Co., LIPA’s precursor, and co-chairman of the LIPA Oversight Committee, formed by the Suffolk Legislature in 2010. He stood with Schumer in Wantagh and told the Press that Nat Grid “has been dragging its feet about openly offering its personnel in the event of a storm” after PSEG takes over.

Asked to comment for this story, a National Grid spokeswoman, Wendy Ladd, would only say: “National Grid will continue to provide the benefits of its combined downstate employees and U.S. Operations to LIPA’s customers for storm response to the end of the contract.”

When Irene slammed the Island starting on the evening of Aug. 27, its sustained winds were between 40 mph and 60 mph, making it “the most power and wide-reaching storm to hit Long Island since Hurricane Gloria in 1985,” according to the 112-page report prepared on behalf of the PSC at Cuomo’s request. Because LIPA is not regulated by the PSC, Vantage Energy Consultants, an independent contractor based in Florida, conducted the study. The conclusions were not kind.

“This thing is damning,” says Cordaro. “If I were a LIPA board member, I’d be calling for the ouster and firing of the management of LIPA.” He added that if “you go beyond the polite language in the executive summary you see a tremendous amount of negligence…and lack of utility professionalism,’’ adding that “many times” Vantage said Nat Grid and LIPA’s operations were “not up to industry standards.”

The Vantage report “confirmed what a lot of us know and felt that the job that was done was inadequate,” says David Calone, a member of the LIPA Board of Trustees and chairman of the trustees’ LIPA operations committee. He said they were frustrated by the communications failure to keep the customers and public officials informed and it will be “certainly better” than it was last year. One glaring finding from the report was that Nat Grid was relying on a main frame computer that still used COBOL, a computer language now decades old, to handle its outage management system. Ironically, LIPA had just approved a contract to upgrade the system the Wednesday before Irene came ashore.

“We had no ownership of that system,” explains Michael Hervey, chief operating officer of LIPA. “That was a LILCO system, a KeySpan system [its successor], a National Grid system, and finally in 2009 we negotiated ownership rights of that system. We had no right to change that system until that point in time.”

With a view of Nassau from his Uniondale office in the Omni Building, Hervey, in shirt sleeves and tieless, acknowledged the findings in the Vantage report, particularly in regard to keeping customers informed, and insisted that LIPA will do a better job when the next bad storm strikes.

“We’ve made a significant improvement in the old system for this year, which should be able to give much better information—not perhaps world-class information, but much better. The new system will be ready sometime next year.”

One advantage LIPA has going forward, says Hervey, is that its new operating contract with PSEG gives it more leverage than it ever had. As he spoke to the Press, he said that representatives of PSEG were in the building already working on the transition. “They’ve looked over the system and are very comfortable with it.”

One glaring finding from the study was how LIPA could not handle the volume of customer calls—no doubt a factor in LIPA ranking last in customer satisfaction in a survey of major U.S. utilities released earlier this month by J.D Power and Associates. Its electric rates, among the highest in the nation, are another reason.

“The first three or four days [after Irene] perhaps up to 20 percent of our calls got blocked because of congestion in the phone system,” says Hervey.

Too many customers called the “1-800-Ask-LIPA” number, which wasn’t an emergency number, he explains, and Verizon had never told LIPA that calls from Suffolk couldn’t make it to LIPA headquarters because of the phone system’s configuration. But that problem has been corrected—those calls will be automatically forwarded in an emergency—and Verizon will give LIPA’s “800 numbers” a national, not a regional, priority, which means that other call centers will handle them if necessary.

Hervey says LIPA will make sure that public officials have their own hotline numbers—and if they leak it to the public, as a village mayor did last August—it will be changed. LIPA will also update officials with a conference call twice a day. It also plans to expand its usage of social media so that data can become “operational”—Hervey’s term—if it requires action, say, if someone tells LIPA on its Facebook account that a “transformer is on fire.”

What LIPA has to do, Hervey says, is “set the proper expectations for our customers… Ahead of the hurricane we never really stood up and said, ‘Look, customers, this could really be one to two weeks.’” Knowing that possibility, he says residents would take longer precautions, stocking up on supplies, buying a small generator, making contingency plans to stay somewhere else if need be.

One thing LIPA can’t do, Hervey admits, is bury all the power lines—it would cost $30 billion. The Vantage report recommended that tree trimmers clear a wider corridor for the lines, 10 feet rather than six, but Hervey says, with a wan smile, “We love our trees on Long Island.”

At present, there are some 300 to 400 linemen on call. Following Irene, some 4,000 workers—thousands from out of state—came to the Island to help.

Regarding Schumer’s criticism of dual game plans, Hervey says there were two plans—Nat Grid had operational procedures and LIPA had procedures for its headquarters—“but they don’t conflict.” He does, however, agree with the report’s suggestion that they be merged regardless.

On a more serious note, key differences came up when LIPA and Nat Grid tried to handle the emergency response in coordination with local government.

“We thought a plan was in place,” Hervey says. “But when we actually implemented it we found out that all the towns, us and the counties were not on the same page with the same plan. We all had different preconceptions about the way that would work….”

“Customers are asking for change and they’re getting it,” says Hervey, adding that LIPA is the leader in the state on using solar power.

Don Daley of the IBEW Local 1049 sees improvements.

“LIPA has more control over staffing where they didn’t have it before, which is going to be big,” he says. Still, he hopes that the public has more sympathy for his members following the next storm than they did during Irene’s cleanup and will understand that the bigger jobs. For instance, restoring power to major thoroughfares and communities at large, take priority than a service disruption to a private residence.

“A lot of our own members were leaving their families without lights to go put on our neighbors’ lights,” Daley says. “It’s hard to come home to a dark house and your neighbor’s got a dark house!”

Others are not so optimistic.

Cordaro, who handled 20 major storms during his 40-year utility career, remains highly skeptical that LIPA can do a better job, given its present service structure. Essentially LIPA takes the heat but cannot provide it, he says, relying on private contractors to meet LI’s energy needs. Before the Vantage review was released, his oversight committee had just released its own highly critical 191-page report to the Suffolk legislature.

Meanwhile, a report by the Inspector General on LIPA’s past practices hasn’t been issued and the governor’s press office declined to comment when it would be; the Federal Emergency Management Agency is scrutinizing LIPA’s reimbursement requests of its restoration costs—some $115 million—holding up the checks; and thanks to a bill passed by the state legislature and signed into law earlier this year, LIPA will undergo a management audit that should be completed next year.

Additionally, Cuomo hasn’t filled LIPA’s chief executive officer position—Hervey, who’s been at LIPA since 2010, has assumed the role on an interim basis—and two LIPA trustees are still serving despite their expired terms because the governor hasn’t named their replacements (they are volunteers).

On the plus side, LIPA’s rates are the lowest they’ve been since 2005, but that is small comfort when the lights are out and the air conditioner isn’t working on a blazing hot day.

“You hope that LIPA is listening and learning from all this and is reacting to it properly,” says Cordaro. “I’ve got to say that history doesn’t demonstrate that they do that very well. The bottom line is that I have my fingers crossed just like everyone else does… and [LIPA] magically through osmosis or whatever other means improves its ability to manage storm restoration.”

As if LIPA doesn’t have enough on its plate worrying about the weather, it also has to plan its transition from Nat Grid to PSEG in 2014 as well as renegotiate its power supply agreement, which expires next year. That could affect the “legacy plants” like the antiquated ones in Northport and Port Jefferson, which rely on gas or fuel and aren’t as energy efficient as the new smaller plant such as Caithness in Yaphank but are vital to those communities’ tax base. LIPA also must wade through more than 40 proposals competing for a future share of the utility’s next generation of 2,500 megawatts of energy (on a typical hot day the Island consumes about 5,600, with some 600 to spare).

Among the ideas the board has to winnow down are a giant 400 megawatt large-scale battery, a proposed 200-turbine wind-farm off Rhode Island that could be hooked up to LI and a new gas-powered plant on Shoreham’s former nuclear site that would be connected to a pipeline from Connecticut.

Local environmentalists and energy watchdogs stress that solutions are needed now.

“Storms are a fact of life on Long Island,” says Adrienne Esposito, executive director of the Citizens Campaign for the Environment, a nonprofit watchdog group. “But the new fact of life is that these storms will be increasing in intensity because of climate change. That’s science, that’s not theory. And LIPA needs to be planning for that in its energy choices and in its management preparedness.”

With that goal in mind her group is joining others like Gordian Raacke’s Renewable Energy Long Island to host a half-day conference on July 31 at the Long Island Association’s Melville office to promote offshore wind as part of the portfolio.
Rep. Tim Bishop (D-Southamton) is the keynote speaker.

LIPA trustee member Neal Lewis, executive director of the Sustainability Institute at Molloy College and a big proponent of cleaner energy, says that “LIPA is moving forward on some significant initiatives in terms of renewables and efficiency,” but declined to say which projects LIPA is favoring. The finalists are expected to be announced this fall.

“This is exactly LIPA’s test for the next five years and that test will be answered in September when they come up with the short list,” Esposito says. “Are they including large-scale renewables? Are they including cleaner, safer power? Are they looking to get us off our fossil fuel addiction? That’s exactly the questions that need to be answered.”

LIPA’s new program to foster small-scale solar panel projects, called the Feed-in Tariff, involves a contract paying a provider 22 cents a kilowatt hour for 20 years to facilitate financing. It already has 120 applicants since it began July 16.

“The industry has not changed so much but public sentiment has changed,” says Esposito, “and the industry is just now starting to play catch up.”

“It’s always difficult for people to understand that you need to change when there’s a big paradigm shift coming,” says Raacke, “because it’s easier to just do your business as usual than to do something new.”

The Exxon Valdez oil spill in 1989 made Raacke realize that his personal demand for oil “when you pull up to the gas station, when you open your fridge” made him “part of the problem,” so he realized that he could “be part of the solution.”

Then he set about building his new home.

“I’m a civil engineer by training and my dream was always to build my own home, and of course I had to make it a super-insulated and super-energy efficient home,” he says.

After rebates and tax credits, he says it cost him about $6,000 to install the 2.6 kilowatt solar panels on his carport and another $6,000 for a solar-powered water heater attached to the roof. Typical homes on LI, he says, have the equivalent of a 4-foot hole in their wall where their cool (or hot) air goes, so he advises people to contact LIPA about a free energy audit, or to go to the LISHINES.org website for help in calculating solar panel requirements.

Raacke says that he wants LIPA to look to the future when it makes its decisions about meeting the Island’s energy needs.

“They could lock us into more fossil power, more business as usual, more last-century technology,” he says and that would be “a situation like Shoreham… That was a bad decision.”

On his recent LIPA bill he pointed out the 26 cents he was charged for the Shoreham settlement.

“We’re still paying for that,” he says, shaking his head and looking out his 19-foot-high window enclosing the “green room,” where he and his wife’s orange cat is lounging comfortably in a sofa chair. The outside temperature was in the 90s, but inside it was cool and there was no air conditioner.

“Harnessing energy delivered from the nearest star in our galaxy to us can create jobs and keep the money in the local economy!” smiles Raacke. He sees the silver lining in the present situation. “It’s not just a crisis, it’s a tremendous opportunity.”