"It is beyond unacceptable to leave hundreds of
thousands of customers in the dark for as long as these utilities did last
year," Governor Cuomo said. "This settlement makes crystal clear that
utilities in New York have an obligation to prepare for severe weather and to
develop robust storm response programs, and if they fail to adequately do that
job we will hold them accountable and force them to change how they do
business."
As part of the settlement announced today, NYSEG
acknowledges and admits to 18 violations of its state-approved emergency
response plans, and RG&E acknowledges and admits three violations.
To compensate customers, company shareholders will pay $10.5
million: $9 million from NYSEG and $1.5 million from RG&E. The money will be
used to provide customer benefits at the direction of the Public Service
Commission. In addition, the companies will do the following:
• In the near term, NYSEG will hire and maintain 20
additional employees with storm restoration responsibilities; additionally, PSC
staff and NYSEG will review long-term staffing needs and requirements;
• NYSEG will maintain at least 175 damage assessment trained
employees, excluding employees who perform restoration work during an emergency
event;
• NYSEG and RG&E's Emergency Response Organization will
form a group to develop a Storm Response Exercise program to include
in-the-field activities and non-table-top storm response exercises, including
testing their enhanced life-support equipment customer contact and tracking
procedures, as well as communication and coordination with which will include
municipal and county governments;
• NYSEG agrees to retain a third-party consultant, subject
to consultation with Commission staff, to audit and assess the companies' storm
response training and training exercise programs and NYSEG agrees that
shareholders will bear any incremental costs for the term of engagement for the
consultant.
Department of Public Service CEO John B. Rhodes said,
"The primary task of a utility is to supply safe and adequate electricity
to customers. A key component of that is for the utility to be prepared for a
storm and to restore power as safely and as quickly as possible, and we will
hold them accountable to do just that."
In recent years, the State has faced an increased frequency
of severe weather events that have impacted utility infrastructure. It is
mission-critical that utilities are adequately prepared to meet and address
these new realities and respond appropriately, including concretely improving
plans and practices with each cycle.
The Commission issued an order on April 18, 2019 commencing
an administrative enforcement proceeding against NYSEG and RG&E that would
consider penalties against the company for alleged failures to adequately
prepare for storms that hit their service territories in 2018. Today's
settlement will be reviewed and acted upon by the Commission at a future
session.
The Commission also directed Department staff to file an
enforcement action in State Supreme Court to compel the utility to comply with
storm preparedness and response requirements, and a proposed consent order is
to be filed in State Supreme Court to settle the Commission's enforcement
litigation.
The 2018 winter and spring storms essentially affected
customers throughout New York State in all major electric utility service
territories. Winter Storms Riley and Quinn, which hit the mid-Hudson region
five days apart in March, had peak outages of approximately 500,000 and
162,000, respectively, resulting in some customers being without power for more
than a week. In addition to storms Riley
and Quinn, the Commission's investigation focused on three other storms in
2018: a windstorm in Western New York in April; a windstorm in the Plattsburgh
and Glens Falls areas in early May; and a severe thunderstorm in the mid-Hudson
region in mid-May.
