N.Y. Official Said to Probe Utilities on Storm Response

Long Island Power Authority and Consolidated Edison Inc. (ED) are being investigated by New York Attorney General Eric Schneiderman over their preparedness for Hurricane Sandy and response to the storm, a person familiar with the matter said.

Schneiderman yesterday issued subpoenas to the utilities, said the person, as thousands of LIPA customers remained without power two weeks after the storm.

Schneiderman is inquiring whether LIPA violated a state law requiring it to assure its flow of electricity and the accuracy of statements to bondholders about its ability to function under severe conditions, said the person, who asked not to be identified because the matter wasn’t public.

The attorney general is investigating whether Con Edison, as an investor-owned utility, violated a public service law requiring it to supply safe and adequate service, the person said.

Sandy made landfall on Oct. 29, bringing 85 mile-per-hour (137 kilometer-an-hour) winds and record-setting floods to New Jersey and New York. The hurricane and a subsequent snowstorm on Nov. 7 knocked out power to 8.66 million utility customers, including about 2 million in New York, according to the U.S. Energy Department.

LIPA, based in Uniondale, New York, had restored electricity to 99 percent of customers, or about 1.1 million people, as of Nov. 13. New York Governor Andrew Cuomo has convened a commission to investigate utility companies for what he said was their failure to properly prepare for the storm.

“We are cooperating with the attorney general’s request,” D. Joy Faber, a spokeswoman for New York-based Con Edison, said in an e-mailed statement. “We look forward to reviewing the company’s storm preparations and response with the attorney general and all interested parties.”

Elizabeth Flagler, a LIPA spokeswoman, said in an e-mail that the company has reviewed Schneiderman’s subpoena and will “comply with it in all respects.”

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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