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Letter: Would Fixing LIPA Make a Difference?

Energy consultant says problems at the utility may run too deep.

Thomas Bjurlof, a resident of Port Jefferson, consults on energy and information technology for numerous international firms.

There are at least three glaring problems concerning the Long Island Power Authority. They are fairly obvious shortcomings apparent to most casual observers.

(1) Failure of command and control. In spite of the "dress rehearsal" provided by tropical storm Irene in 2011, LIPA failed as a utility in the wake of Sandy. Some say the main problem was communication. Those of us who were without power for two weeks or more understand that the core problem was much more fundamental. Lack of communication was one of the symptoms of failure of execution.

(2) There are no meaningful checks and balances. LIPA does not answer to a regulator or to shareholders. If anything, LIPA's board answers to its political masters.

(Many board members are indeed hardworking and independent minded, but ultimately they are appointed by the New York State Senate, the Assembly, and the Governor.)

(3) LIPA has failed to understand and effectively execute its role as the manager of two major outsourcing contracts, the management and the power supply agreements. LIPA pretends to be a utility, when its proper function should be that of contract manager.

Let's assume, for arguments sake, that the investigators and commissions who now scrutinize LIPA are able to effectively address these three glaring problems, would the problems with LIPA then be solved? I believe the answer is no.

To understand why one must pierce the veneer - LIPA is no more than a veneer, a pretend utility that provides political cover for an unworkable electric utility structure.

This structure is defined by two large outsourcing contracts that LIPA enters into and has the responsibility to manage. These contracts are the main cause of Long Island's dysfunctional electricity. Why? Because they create the wrong incentives with resultant dysfunctional customer service, lack of investment in infrastructure, and the highest price for electricity on the US mainland.

LIPA's contracts require approval by the New York State Comptroller and the Attorney General to be in effect. To date such approval seems to have been somewhat perfunctory, mainly addressing formal contracting criteria, not the overall concepts implemented by the contracts, or the monopoly and monopsony that define Long Island.

Fixing the problems of Long Island's electricity entails much more than "fixing LIPA". Proclaiming that LIPA must end, as Governor Cuomo has done, is a start. For there to be a lasting solution to Long Island's problems there must however be a recognition that these problems go far beyond the hapless one hundred membered LIPA contingent. There must be a recognition that reforming LIPA should not be the main show, but one of the components of a comprehensive solution.

Long Island does not need another politically expedient solution, band-aid, or attractive sound bite. We need major structural reform. We cannot continue to paper over the vexing problems created by the Shoreham fiasco. The industry, as it is structured today, does not work. Anything less than major structural reform would only perpetuate our problems and continue the descent.

It is time to start over. There must now be a persistent commitment to comprehensive reform.

Greg Martinez November 28, 2012 at 08:31 PM
1. LIPA is the regulator. 2. Replacing one governmental/political regulatory regime (LIPA) with another fixes nothing. 3. THE SOLUTION IS PRIVATIZATION. Allow the private sector to totally run our electric grid. Allow the effective regulator of profit (with stockholders and investors) to give us all the electric power we need to grow and prosper.
littleShamrock November 29, 2012 at 12:43 AM
Well if LIPA can't help us, apparently it can start selling cheap shoes and handbags.
knowitall November 29, 2012 at 01:06 PM
Hahahhaha privitization with $ 7 billion in debt!!!?? Too funny. Never. Going. To. Happnen.
Marie Domenici November 29, 2012 at 01:54 PM
Put it underground! If we aggregate the numbers of storm repair over the last 10 years....we could have buried the lines 2 x over!!! Putting it underground is a no brainer and will keep people working while accomplishing the goal. Lastly, trees and power lines are an oxymoron so at the very least consider addressing this problem!
North Fork Bob November 29, 2012 at 03:32 PM
I've seen nothing but a mess from Lillco/Lipa for 50 years.Paying the highest rates in the Country. When people were finally and totally fed up with Lilco and the total mess that was Shoreham and their imbecilic evacuation plan government stepped in.Like they did at OTB that's losing money.Now that Lipa has fallen down and is in a coma where. do we turn? We've been beaten and strangled.Now we're supposed to trust these guys and a new round of politician.Remember Suffolk Co was 530 million dollars in debt. They've picked our pockets and taken food out our children's mouths.A feasible solution must be worked out using private citizens.
Love East Hampton November 29, 2012 at 03:51 PM
You said it! Better organization, better service, honest billing...all has to happen. But there has to be a way to get the capital investment done to get the infrastructure up to snuff, and a big part of that is moving lines underground. How to make that happen? It won't be financially easy now, and figure out how to get it done without just lining the pockets of the same incompetents and grifters even more.
Irene Gersch November 30, 2012 at 05:09 AM
1st. Employ Eneregy Exeperts and/or anyone in the Eneregy Feild to run, manager , and operate this Engergy Company 2nd. Fix, re-build, change the transformer and substations. Bc even if all the power lines are underground, it makes no difference if these keep getting damaged. Miller Place and Stony Brook were out for as long as 14 days and they have underground wires 3rd Basic "Tree Trimming" and replaces " poles" why the hell is that still not done!! 4th- MOST IMPORTANT FUNDING HOW DID THE USA BUILD ALL THE BRIDGES TUNNLES AND HIGHWAYS BONDS- there's your private investment

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