By Joe Tyrrell, NJSpotlight.com
Utility companies acknowledged communications problems during and after Hurricane Sandy, but defended their overall performance before a state Senate committee studying responses to the superstorm.
That did not sit well with Stefanie Brand, director of the Division of Rate Counsel, who also took issue with the idea that the utilities wanted to spend some $1.1 billion to $1.2 billion to deploy smart meters.
Brand argued that the BPU and Legislature must scrutinize utility spending and revenues before funneling more customer or taxpayer funds to them.
But not all cost estimates brought a similar response.
The Passaic Valley Sewerage Commission, whose Newark treatment facility inadvertently dumped 775 million gallons of untreated sewage into waterways, won sympathy for its loss of power during the storm and estimated $200 million in resulting damage.
While discussions about costs and miscommunications were a common thread at the state Senate Budget and Appropriations Committee hearing, a number of other topics were touched on, including infrastructure, responsibility, ratepayer increases, and "importing" workers from out of state.
An Unsympathetic Ear
Brand was particularly unsympathetic to the utilities, saying that their rates already include funds for infrastructure.
The power companies’ efforts to replace working meters with “smart” ones “sticks in our craw,” because the devices would not work better during outages, she said.
Noting the $1 billion cost estimate from JCP&L and PSE&G, Brand said, “It might be better to spend that money on raising the substations or improving the reliability of the power grid.”
It was one of the few tart moments during a generally polite hearing in Trenton, but not the most dramatic. A round-robin of exchanges among JCP&L President David Lynch, state Sen. Kevin O’Toole, and Robert Hanna, president of the state Board of Public Utilities, brought underlying tensions to the surface.
“A lot of things went very wrong” during and after the October 29-30 storm, O’Toole told Lynch, “and you have to take some responsibility.” The timing of the rate hike application was “insulting in many ways and it’s coarse in many ways,” O’Toole said.
JCP&L, owned by FirstEnergy Corp. of Akron, was able to bring 8,500 line workers as part of an “army” of out-of-state employees who arrived before and after the storm, Lynch said. As a result, “we were able to restore 1.3 million power outages in really 13 days,” he said.
While the timing of the rate hike request was “unfortunate,” the BPU ordered JCP&L to file it, Lynch said.
But Hanna opened his testimony by countering that the order was to address questions about previous JCP&L spending. The company chose to request a rate increase as well, he said. But he promised that would not simply coast to approval.
The BPU will examine whether the company is using New Jersey as “a cash cow” to prop up FirstEnergy operations elsewhere in the country, he said. If the allegations from Brand’s office turn out to be true, “that would be alarming,” Hanna said.
Earlier this year, Brand’s office reported JCP&L was earning almost 12.4 percent on its New Jersey operations, compared to 8.2 percent for Public Service Electric & Gas. Another rate case revealed Atlantic Electric was sending 82 percent of local revenues out of state, illustrating the potential problem, she said.
Failure to Communicate
While the utilities marshaled their forces better for Sandy than for some previous major storms, Hanna agreed with several legislators that the companies need to examine how they actually dispatch workers.
PSE&G President Ralph LaRossa said bringing in workers beforehand and throughout the cleanup was the most significant improvement. He acknowledged shortcomings in communicating with customers and communities, but attributed that to the industry’s “antiquated” systems.
We have to call customers and say, ‘We think you’re back, are you back?’”
But Hanna “respectfully disagreed,” saying, “we have plenty of ways to communicate.” While the power companies touted their use of social media, legislators backed Hanna.
Power companies have not done enough to coordinate their outreach with local officials and emergency management, said state Sen. Loretta Weinberg (D-Bergen). Many towns already have reverse 911 or other outreach systems, but could not get sound information from their utility contacts, she said.
In Red Bank police and fire personnel contacted residents and businesses directly, said state Sen. Jennifer Beck (R-Monmouth). If the utilities had supplied timely information, “we could have distributed it,” she said.
Sometimes the frustration was personal. After three days without power, and concerned about the effect of cold on his ailing wife, state Sen. Anthony Bucco (R-Morris) said he called JCP&L, looking for some idea when power might be restored. He was told “call 911” for his wife, he said, but instead he bought a generator.
The utility executives agreed with state Sen. M. Teresa Ruiz (D-Essex) that they should work more closely with emergency management officials to identify critical customers and prioritize power restoration to them. One section of her district that suffered a prolonged outage included seven gas stations and a nursing home, Ruiz said.