Nix LI Power Company After Sandy Failure

ALBANY, N.Y. (AP) -

The powerful commission overseeing the response of New York utilities to Superstorm Sandy recommended eliminating the state’s Long Island Power Authority and replacing it with a private company, an idea that was immediately questioned Monday as a threat to create even higher rates.

The Moreland Commission created by Gov. Andrew Cuomo criticized LIPA as unprepared for Superstorm Sandy then inept in its response, leaving many of its 1.1 million customers without power for as long as 21 days.

The commission also recommended the state’s utility regulator since 1907, the Public Service Commission, be scrapped or strengthened so that it can mete out penalties that aren’t passed onto to ratepayers or even terminate a utility’s ability to operate in New York.

“The six utilities operating in New York and LIPA are operating as monopolies in their own exclusive service areas with no chance of losing all or part of their territory because of ineffective, weak or toothless government oversight,” said Robert Abrams, the former attorney general who is a leader of the Moreland Commission.

The commission considered other options for LIPA, including eliminating its contract or transferring operations to the upstate New York Power Authority, but ultimately backed privatization.

LIPA, which has more than 1.1 million customers on Long Island and the Rockaways in Queens, is “reviewing the report and will continue to cooperate with the state and the Moreland Commission to do what is in the best interest of Long Island’s ratepayers,” said the authority’s spokesman, Mark Gross.

LIPA has often been criticized for slow restoration of power after several storms over three decades.