“We are not giving up on public power,” declared State Assemblyman Fred W. Thiele, Jr. last week in a presentation before Long Island Metro Business Action titled “Should LIPA be a Municipal Power Company?”
Thiele spoke of how “the goal of replacing LILCO with a real municipal power company” envisioned by the act passed in 1986 by the State Legislature creating the Long Island Power Authority was never achieved. Instead, a “third-party management model” was adopted in which LIPA has “contracted with a private entity” to operate Long Island’s electrical system.
The set-up is “the only one of its kind in the United States of America,” said Thiele.
The original vision for LIPA was further “hijacked” in 2013 when then Governor Andrew Cuomo pushed “the so-called LIPA Reform Act.”
“I voted no,” he said of the measure, “and it was one of the best ‘no’ votes I ever cast.”
Under the scheme promoted by Cuomo, LIPA was “stripped down” and PSEG, the private company which in recent years has run the Long Island electric grid for LIPA, received more clout and became the “least-regulated, with the least oversight, of any utility across the nation.”
Thiele detailed failures in performance by PSEG during Tropical Storm Isaias in 2020 and the failure of its predecessor private firm running LIPA’s grid, National Grid, in Super-Storm Sandy in 2012. The third-party management model “has proven time and again it has not worked,” he said.
The National Grid Sandy debacle was the ostensible reason for Cuomo to engineer “behind closed doors” bringing in Newark, New Jersey-based PSEG and for putting together the LIPA Reform Act which not only continued but expanded the LIPA structure of depending on a private company.
It’s high time, said Thiele of Sag Harbor, for a return to the original vision of LIPA being a public power entity. He detailed how he and State Senator James Gaughran of Northport, joined by other state lawmakers, are seeking to have LIPA operate the electric grid itself.
Reinforcing Thiele’s critical comments about the big problems of LIPA contracting out to a private company running the electric grid was Dr. Peter Gollon, a former member of the LIPA board of trustees. Gollon, at the teleconference Friday, said “I agree” with the assemblyman’s points. He said the private contractors “not only have a difference in interest, they don’t have competence.” He said “LIPA staff has the competence to run the utility.” Dr. Gollon, who lives in Huntington Station and is also former energy chair of the Long Island Sierra Club, said he wanted to “give a perspective from the inside.”
Thiele and Gaughran are sponsoring a measure creating a Legislative Commission on the Future of the Long Island Power Authority to lead to a “restructuring” of LIPA.
It would be composed of members of the Assembly and the Senate, and there would be an advisory board with wide-ranging representation to assist the commission. It would hold numerous public hearings. “Our goal is to try to get this all done by April 2023,” he said.
He said the move to bring LIPA back to its initial concept would be “modeled on the process we used to put together” the Long Island Pine Barrens Protection Act in 1993, which has succeeded in preserving more than 100,000 acres of pine barrens. This process brought together environmentalists, business people and governmental representatives. Likewise, on electricity on Long Island we must “have a solution that comes from the bottom up rather than the top down.”
Last year, LIPA conducted its own study on “options” that concluded that there would be “potential savings” of “$65 to $75 million a year” and higher “reliability” if it operated the grid itself. But Cuomo, he said, “short-circuited” further consideration, and LIPA, with the majority of its board appointed by the governor, voted for an extension of its contract with PSEG. Thiele said the contract has “an opt-out clause.”
Asked by several attendees at his presentation about the position of Cuomo’s successor as New York governor, Kathy Hochul, Thiele, a member of the State Assembly for 13 terms, said Hochul becoming governor has “been a breath of fresh air.” She has shown to be “cooperative and collaborative.” He said: “We certainly want to engage with the governor’s office.”
After years of Cuomo’s heavy-handed manipulations of LIPA, long needed is a governor sensitive to the people’s will and the intentions of the legislation that created LIPA.