Blackout Backlash Builds as Sandy Slow Recovery Drags Out

Nov. 2 (Bloomberg) – Bloomberg’s Alix Steel reports on the logistics behind the problems in getting gasoline in the New York area where lines continue to build in the wake of superstorm Sandy. She speaks on Bloomberg Television’s “Market Makers.”

Four days after super storm Sandy blacked out millions of homes and businesses in the northeastern U.S., complaints are rising from customers who may have to wait as much as two weeks longer to see power restored.

More than 60,000 workers marshaled by utilities and plane- loads of equipment flown to storm-ravaged states haven’t been sufficient to hasten the pace of recovery, which is lagging that of Hurricane Irene in 2011, according to data compiled by Bloomberg Industries.

Power had been restored to 4.6 million customers as of yesterday, or about 57 percent of those blacked out, compared to 74 percent at the same stage of clean-up for Irene, which hit many of the same areas. Blackouts dropped today to 3.6 million, according to the U.S. Energy Department.

“It’s verging on anger at this point,” Senator Richard Blumenthal, a Connecticut Democrat, said in a phone interview yesterday. After residents waited days for power to be restored after Irene, “they’ve seen this movie before. They know it’s not pretty when it goes to five days, a week, 10 days.”

Federal and state lawmakers began turning up the heat on utilities to work faster as their constituents hunkered down in darkened homes. A cold front is forecast to bring rain and possibly snow to the Northeast next week.

“We will hold them accountable, there’s no free pass,” Connecticut Governor Dannel Malloy said at a press conference yesterday.

Restoring Manhattan

Consolidated Edison Inc. (ED) will bring two more underground networks online today, restoring power to the tip of lower Manhattan, Mike Clendenin, a company spokesman, said in a phone interview. Full restoration for Manhattan customers is expected tomorrow, he said.

About 570,000 Con Edison customers were without power as of 11:48 a.m., the New York-based utility reported on its website. About 131,000 of those are in Westchester County, where blocked roads have delayed repairs, according to the company.

New York Governor Andrew Cuomo threatened to revoke the operating certificates of any utilities whose recovery efforts fall short. Power companies had plenty of time to prepare for the storm, the governor said in a letter yesterday to executives at all of the seven utilities operating in New York.

“We knew this storm was coming, we went through this with Irene,” Cuomo said at a press conference today. “There was no great shock.”

Management Accountability

Cuomo’s letter singled out the Long Island Power Authority, which was investigated for its response to Irene. Another failure by the utility “would warrant the removal of the management responsible for such colossal misjudgments,” he wrote. The utility reported 535,760 customers without power as of about 11:49 a.m.

Rebuilding a grid battered by wind and flood, critical to restoring transportation, employment and basic comforts to a region of 50 million people, is a top priority for President Barack Obama’s administration, state officials and utilities tarnished by their slow response to three recent major storms, including Irene.

To speed recovery work, the Pentagon dispatched 17 military transport planes to the region yesterday packed with more than 600 tons of power-restoration equipment. Marines and sailors from Camp Lejeune in North Carolina also were being deployed, the Marine Corps said in an e-mailed statement.

“You’re going to start to see those results soon,” New Jersey Governor Chris Christie said at a press conference yesterday.

Losing Patience

Consumers begin losing patience when power has been out for three days after a natural disaster, Matthew Cordaro, a 40-year power industry veteran and former chief operating officer of Long Island Lighting Co., said in a telephone interview yesterday.

Two nights without heat or light in northern New Jersey was all Judy Speicher could stand. She left her husband to keep watch over their Millburn home and drove her five-year-old son to Connecticut, where her brother’s home had power.

“I just can’t take it,” Speicher, a former Bloomberg Radio employee, said in a phone interview. “It’s too cold, too dark, too depressing.”

Utilities are taking longer to assess damage and make repairs because the extent of damage from Sandy far exceeds the destruction caused by Irene, said Brian Wolff, a senior vice president of the Edison Electric Institute, a Washington-based trade group representing publicly traded power companies.

‘Unprecedented Event’

“This is the largest weather-related power outage caused by a single event in the U.S.,” Wolff said. “It’s really an unprecedented response to an unprecedented event.”

A total of 7 million homes and businesses lost power during Irene, compared with 9.5 million for Sandy, according to the institute’s survey of power losses. The 3.6 million without power today includes 1.6 million customers in New Jersey, 1.3 million in New York and 239,000 in Connecticut, according to the Energy Department.

“I’m seeing frustration, disorganization and slow recovery,” Cordaro, the former utility executive, said.

What he wasn’t seeing was utility crews and bucket trucks repairing lines on blacked-out Long Island. “I’m riding on a road right now where I should see a lot of trucks. I don’t see a single truck,” Cordaro said.

Crews will move into neighborhoods once transmission lines and substations are repaired, said Elizabeth Flagler, a spokeswoman for the Long Island Power Authority.

“We had to rebuild the backbone of our system,” she said.

Saltwater Factor

Utilities’ restoration efforts are complicated by the widespread flooding damage caused as Sandy swamped parts of Manhattan and New Jersey Oct. 29, said Samuel Brothwell, senior utilities analyst for Bloomberg Industries, in a telephone interview.

“Flooding appears to be the number one thing that affected utility infrastructure, and it also affected the number of customers that can accept power,” said Brothwell, who lives in a coastal area of Monmouth County, New Jersey, near where the storm made landfall. “There are towns near me that are essentially gone. Some places won’t be accepting power soon, if ever.”

The storm forced Con Edison to pre-emptively cut power to large swaths of New York for the first time in its history, ripped out chunks of Atlantic City’s famed boardwalk and submerged coastal communities in New Jersey.

Westchester County

Con Edison said yesterday the “vast majority” of customers who lost power would regain service by the weekend of Nov. 10. The remainder will have to wait another week or more as crews battle more than 100,000 downed wires in Westchester County.

FirstEnergy Corp. (FE)’s Jersey Central Power & Light, which served many of the shoreline communities battered by the storm, said Oct. 31 that most of the utility’s 1.1 million customers would have power back within a week. Those in hardest hit areas would have to wait 14 days for electricity, while the rest would regain service “once damaged roads, infrastructure and homes are rebuilt.”

“We know people are frustrated because they don’t see crews, but we are coming,” said Chris Eck, a spokesman for the New Jersey utility, in a telephone interview. Workers must repair high-voltage transmission lines, sub-transmission and substations before they can move into neighborhoods, he said.

Connecticut Regulators

In Connecticut, which was especially hard hit by Irene and a freak October snow storm last year, regulators are closely monitoring efforts to restore electricity to the 350,000 residents left without power by Sandy. The state’s two largest utilities promised service would be restored to most customers early next week.

The Connecticut Public Utilities Regulatory Authority investigated the utilities’ response to last year’s storms and Chairman Arthur House said in a telephone interview that he wouldn’t rule out another round of hearings centered on Sandy.

“The utilities are better prepared with crews on the ground, but whether they are adequately prepared remains to be seen and also whether they are using their assets and resources effectively,” Senator Blumenthal said. “The proof is in the results, and so far the results have failed to satisfy a lot of people.”

Northeast Utilities (NU), owner of Connecticut Light & Power, estimates most of its customers will have electricity back by Nov. 6, Frank Poirot, a spokesman for the company, said in an e- mail yesterday. UIL Holdings Corp. (UIL)’s United Illuminating will restore electricity to 95 percent of its customers by the end of Nov. 5, according to a statement yesterday.

Comparing Records

With utilities from Georgia to Maine and as far west as Michigan seeing their grids damaged by Sandy’s winds and rains, lawmakers and consumer advocates will be able to quickly identify companies whose planning and clean-up efforts fell behind their peers, Brothwell said.

Customers of Jersey Central that criticized the utility for its slow response to Irene last year weren’t happy to see rival Public Service Enterprise Group Inc. restore lights to Newark, New Jersey, and other cities while they still waited for crews to arrive.

Public Service had returned power to about 1 million of 1.7 million customers affected by Sandy as of 3:30 a.m. today, and said “virtually all” of those who had lost power would be back online within the next week to 10 days. Jersey Central reported today 709,830 of the more than 1 million customers who lost power are still without it.

Grid Upgrades

Public Service, which provides electricity to about 75 percent of New Jersey residents, credited its rapid storm response to the small army of workers and resources it assembled before the storm struck. The electric transmission infrastructure was able to withstand the shock as a result of $2.9 billion it is spending on grid upgrades, Ralph LaRossa, chief operating officer of the utility, told reporters during an Oct. 31 conference call.

“There is absolutely no doubt in my mind, and we see it everywhere we go, that newer pieces of equipment that we have out there have weathered the storm much better,” LaRossa said.

Eck, of Jersey Central, said repairs were taking longer at the utility because “the storm did massive damage to our entire infrastructure.”

Public Service’s customers are concentrated in urban areas, while Jersey Central’s are scattered across “predominately coastal and suburban communities, so there are lots of trees downed and lots of flooding,” said Angie Storozynski, a New York-based utilities analyst with Macquarie Capital USA Inc.

Magnifying Glass

Still, regulators and lawmakers had expressed frustration with Jersey Central’s response to Irene after customers were left without power for as long as a week.

“They definitely are under the magnifying glass as probably all the New Jersey utilities will be,” said Paul Patterson, a New York-based utility analyst for Glenrock Associates LLC. “One has to realize this was a major storm and they were close to ground zero,” Patterson said. “It’s too early to say how they are going to be judged.”

The military transport of equipment “certainly should aid restoration times,” Karen Johnson, a Public Service spokeswoman, said in a telephone interview yesterday. “The more resources we can have on the ground working here in New Jersey, the better.”

New Jersey’s largest utility hasn’t been able to assess the full benefit of the goods and workers flowing its way. “It’s too early to amend our restoration times at this point,” Johnson said

To contact the reporters on this story: Julie Johnsson in Chicago at jjohnsson@bloomberg.net; Mark Chediak in San Francisco at mchediak@bloomberg.net; Benjamin Haas in New York at bhaas7@bloomberg.net

To contact the editor responsible for this story: Susan Warren at susanwarren@bloomberg.net

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