Suffolk Closeup: LIPA Should Provide Electric Service "Terminate" PSEG

SUFFOLK CLOSEUP

By Karl Grossman 

 The Sacramento Municipal Utility District was a model for the Long Island Power Authority when LIPA was created more than three decades ago. 

SMUD has an elected board of trustees and provides electric service to the Sacramento area of California. It’s a service area with a population comparable to that of LIPA’s. SMUD’s establishment was bitterly opposed by an inept private utility, Pacific Gas and Electric Company, PG&E, just like LIPA’s formation was bitterly opposed by the inept Long Island Lighting Company. 

For example, faulty PG&E transmission lines were found to be the cause of the 2020 Camp Fire in California. The deadliest and most destructive wildfire in California history, it burned more than 150,000 acres and killed 85 people. PG&E has now settled with victims’ groups for a total of $25.5 billion, and PG&E has declared bankruptcy.

LIPA since its establishment, instead of itself providing electric service—like SMUD—has contracted with private utilities to do this. Currently, its contract is with Public Service Enterprise Group, PSEG, a Newark, New Jersey-based company.

LIPA is to decide next month whether to continue this arrangement with PSEG or fire it, as it did the private utility it previously had a service arrangement with, the London, England-based National Grid. 

LIPA recently initiated a $70 million lawsuit against PSEG for its terrible performance this past July during Tropical Storm Isaias accusing PSEG of “corporate mismanagement, misfeasance, incompetence and indifference, rising well beyond the level of simple negligence.” PSEG failures were termed “willful” and “in bad faith.” 

“I agree,” says State Assemblyman Fred W. Thiele, Jr. of Sag Harbor. PSEG’s “failure resulted in great hardship and great expense to its customers because of its inferior performance,” he says. “The breach of trust exhibited by PSEG cannot be repaired. The model for contracting out LIPA’s responsibilities to a private company is a two-time loser. There is no reason to think it would be different a third time.”

“When LIPA was created,” says Mr. Thiele, “the vision of its sponsors was the creation of a public power company to replace Long Island’s unaccountable, profit-driven private utility, LILCO. We should return to that vision.”

Indeed, the model of SMUD should be returned to.

In 1923, the citizens in the Sacramento area voted to create SMUD as a community-owned public utility. But PG&E fought that for decades. PG&E’s obstruction was finally stopped in 1946 when the California Supreme Court denied its final petition and SMUD was able to begin operations.

“SMUD is owned by its customers who elect a seven-member board of directors,” its website notes. “SMUD was born of this community, and is an integral part of it. More than just a barebones supplier of electricity, SMUD gives back to the community in ways that make life better for all who live and work in the Sacramento area.”

SMUD had an awful experience with nuclear power as we had with the Shoreham nuclear power plant—another parallel. In 1966, the same year that LILCO announced building its Shoreham nuclear power plant, SMUD purchased land for what became the site of its Rancho Seco nuclear power plant. It was a problem-plagued disaster, ran for 14 years, and was shut down. Among other damage it caused: cancer. A study in the journal Biomedicine International by Joseph Mangano and Dr. Janette Sherman of the Radiation and Public Health Project found cancer rates in Sacramento County declined after the shutdown of Rancho Seco with the end of radioactive emissions from the plant cited as a cause. Fortunately, Shoreham never got beyond problem-plagued low-power testing and was closed before inflicting us with nuclear poisons. 

SMUD now focuses on safe, clean, green. renewable energy, with a big emphasis on solar power. 

At long last, LIPA should return to the vision of being like SMUD—serving Long Island itself, not jobbing out service to private utilities that it then has to fire. “We hired PSEG to do a job and they failed to do it,” said LIPA CEO Tom Falcone as it filed the $70 million lawsuit against PSEG. New York State’s Department of Public Service agrees and has recommended LIPA “terminate” PSEG “as LIPA’s service provider.” 

That should happen, LIPA should provide electric service itself, and also—as the law creating LIPA stipulated—have an elected board of trustees like SMUD.

Karl Grossman is a veteran investigative reporter and columnist, the winner of numerous awards for his work and a member of the L.I. Journalism Hall of Fame. He is a professor of journalism at SUNY/College at Old Westbury and the author of six books.