Peter Burg


Until last summer, H. Peter Burg might have been just another utility executive with environmental problems. The chairman and CEO of Akron's FirstEnergy (FE ) Corp. had to shut down his Davis-Besse nuclear plant after corrosion was found in its reactor. And a federal judge ruled that the company violated the Clean Air Act by failing to install the latest pollution-control technology at an Ohio coal plant. But then, on Aug. 14, Burg and FirstEnergy really stepped in it -- as the utility played a leading role in North America's worst-ever blackout, which cut off the power supply to some 50 million people and cost $7 billion.

FirstEnergy released sketchy information about its plant and transmission-line failures two days after the crisis began. As criticism mounted, FirstEnergy tried to deflect blame. Testifying before Congress in September, Burg, 57, said: "Everyone is looking for the straw that broke the camel's back. But there is no one straw."

In fact, the utility's shortcomings could add up to a whole bale of straw. A joint report from U.S. and Canadian authorities released on Nov. 19 faulted FirstEnergy for not trimming trees near its power lines, failing to maintain a computer-warning system, and not adequately training its staff. FirstEnergy says the report "falls short of providing a complete picture" and suggests that independent power producers and traders overloaded the grid. Burg declined to be interviewed by BusinessWeek.

Not only did FirstEnergy bumble its way to a history-making outage on his watch, but Burg has seemingly written the book on how not to respond in a crisis. Which raises the question: Are First Energy's board members the ones asleep at the switch?

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