Utility companies in New York are facing millions in fines for their muted and unprepared response to Tropical Storm Isaias after the New York State Public Service Commission completed its months-long investigation into their responses.
Con Edison, Orange & Rockland Utilities, and Central Hudson now face fines of more than $137 million in total.
PSEG Long Island was investigated, and numerous failures were also found for their failures to communicate or have a proper response plan in place.
PSEG’s punishment will be determined by the Long Island Power Authority Board of Trustees.
- Earlier story - Isaias: State To Investigate Utility Companies After Cuomo Cites 'Failed Storm Response'
New York Gov. Andrew Cuomo said that Con Edison and Orange & Rockland may also face the revocation of their license due to repeated failed responses.
According to Cuomo, all three companies will now be required to explain why penalties should not be imposed by the PSC for their violations of the laws, regulations, and orders that are “designed to ensure the safety and reliability of the electric system.”
“I'm going to do everything I can do to make sure New Yorkers are compensated, and certainly that New Yorkers are not paying for service they're not getting," Cuomo continued. "I asked the PSC to do an investigation and as a result of its swift action, the three utilities could be penalized $137 million, which is one of the most significant penalties.
“They have a right to contest. Let them contest. We will remain diligent in pursuit of the penalties because we are serious.”
The investigation found that Con Edison’s response to the storm was “wholly inadequate.” The PSC also noted that this isn’t the first time Con Edison has been lambasted for its response to a storm, which was taken into effect in the punishment.
“The prerequisite legal requirement for exercising franchise rights necessary to provide electric service in New York — should or should not be revoked based on these apparent violations as well as Con Edison's prior failures to adequately prepare and respond to emergencies,” they wrote.
Orange & Rockland received similar criticism, and will also face the revocation of their franchise license, according to Cuomo.
“As with Con Edison, and similarly recognizing prior instances where O&R's storm event response had fallen short of legal requirements, staff noticed that its investigation would include the determination of whether O&R's certificate should not be revoked based on these apparent violations as well as O&R's prior failures to adequately prepare and respond to emergencies.”
Con Edison is facing $102.3 million in fines for 33 apparent violations, Orange & Rockland is facing $19 million for 38 apparent violations, and Central Hudson was docked $16 million for 32 apparent violations.
Now that the investigation is complete, the utility companies will have 10 days to respond to the Commission’s recommendations on how to improve their response and restoration efforts and 30 days to respond regarding a possible penalty.
“The PSC has the responsibility to determine how reasonable people would have performed the task that confronted New York's utilities regarding Tropical Storm Isaias,” Commission Chair John Rhodes stated. “Customers pay for utilities' operations.
If those operations are mismanaged, then customers should not be held liable and utility shareholders should pay to remedy such situations and penalties should serve as a deterrent to avoid repeat situations throughout the industry."
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