One year later: Tentative contract will have PSEG pay $30M in restitution for Isaias

The agreement calls for PSEG to strengthen its local management team and pay $30 million in restitution for its failed IT system and for spoiled food and medicine.

News 12 Staff

Aug 4, 2021, 2:44 PM

Updated 983 days ago

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It has been one year since Isaias hit Long Island and caused power outages for more than 300,000 residents. 
Nearly a year later, a new contract agreement with PSEG and LIPA will require PSEG to meet certain goals and timelines.
The agreement calls for PSEG to strengthen its local management team and pay $30 million in restitution for its failed IT system and for spoiled food and medicine. 
LIPA CEO Thomas Falcone says PSEG failed in its response to restore electricity after Isaias because its IT and communications systems didn't work the way it was expected. He says PSEG is improving the systems to stay in contact with customers and give them a more accurate window of when their power will return during future outages.
Russell Yerkes of East Meadow didn't have electricity for more than a week. "They dispatched six crews the same day. Each one of the six crews said, ‘We don't have the equipment or the training to do the job,’” says Yerkes.
Patchogue resident Vinne Arcuri remembers experiencing technical difficulties, saying in part, "The site seemed to be down constantly, the lines - we couldn't get through.”
"All the rate payers on Long Island pay PSEG $80 million a year of management fees. And our investigation concluded this was a management failure,” says Falcone.
News 12 is told after debating whether to sever ties with PSEG, LIPA came up with a new contract with nearly 100 changes to PSEG's IT systems and management.
"It includes easier provisions both to penalize or reduce PSEG's management fees for failures, and also to terminate their contract if they don't perform,” says Falcone.
PSEG issued a statement saying in part, "With 2021's storm season upon us, and the promise of more severe weather in the long-range forecast, we are on full alert. Since last August, PSEG Long Island has incorporated numerous enhancements and upgrades to the electric grid, its systems and its storm processes, including its contingency procedures."
LIPA's CEO says for the next storm, people should be able to get somebody from PSEG on the phone more easily, and they'll also have a more accurate window of when power can be expected to be restored.
"Things like how quickly and how you produce an estimated time of restoration to the customer…the segmentation of the systems, so that if one system fails, it doesn't drag down all the other systems which is what happened during that day,” says Falcone.
Falcone tells News 12 that he hopes the IT systems will be fully enhanced by the end of the year.
The tentative contract still needs to be voted on by the LIPA board.
LIPA and PSEG are also fast-tracking installation of new smart meters on every house in Nassau and Suffolk. This tool is designed to pinpoint exactly which power line is causing an outage at a house.


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