LIPA says it will cancel search process for a new grid manager, plans to extend PSEG Long Island
Power lines along the North Shore Rail Trail in Mount Sinai in the fall of 2023. Credit: Newsday / Steve Pfost
LIPA's yearlong search for a new grid manager was thrown into further chaos Wednesday after the authority disclosed it was canceling the process after discovering a member of its selection committee owned "significant" stock in the recommended bidder.
The decision, announced in a resolution by the Long Island Power Authority published on its website late Wednesday, means that LIPA plans to resort to extending its existing contract with PSEG Long Island, according to LIPA documents.
The resolution, which will be voted on Thursday, notes the selection committee's finding that "PSEG did not satisfy certain minimum requirements" of the bidding process, but states that extending the PSEG contract "will ensure continuity of services and operational stability for LIPA customers until a new [bidding] process and award is completed." No timeline for such a process was released.
PSEG's existing $80 million a year contract with LIPA expires at year's end, and has an option for a five-year extension.
Last month, six trustees voted to reject the selection committee's recommendation to award the contract to Quanta Services, a Houston-based energy infrastructure giant. Quanta, according to LIPA officials, offered a "strong" bid that was materially superior to that offered by PSEG.
The six trustees, most appointees of Gov. Kathy Hochul, voted against Quanta after chairwoman Tracey Edwards criticized Quanta's performance comanaging the trouble-plagued electric grid in Puerto Rico. Quanta, in a letter reported by Newsday on Wednesday, took issue with Edwards' claims and sought to address them, calling for all LIPA review documents to be released publicly.
But the resolution, if passed, may obviate that request.
Newsday recently reported that PSEG in 2024 missed performance metrics for average outage duration and frequency, worker safety, customer call centers and customer satisfaction, among others. It has requested a bonus payment in excess of $15 million, and Newsday has reported its top official, interim president Dave Lyons, made in excess of $830,000 last year.
Mark Harrington, a Newsday reporter since 1999, covers energy, wineries, Indian affairs and fisheries.
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