GOVERNOR CUOMO PROPOSING HIKING FINES TO UTILITIES FOR POOR RESTORATION FROM THE CURRENT .02 OF 1%, .04 of 1% OF OPERATING REVENUES, AND EXPRESS EXIT PROCEDURE. FINE UNDER PRESENT RATES: $53.4 MILLION


WPCNR THE POWER STORY. FROM THE GOVERNOR’S OFFICE. AUGUST 24, 2020 with notes by WPCNR:

Governor Andrew M. Cuomo today announced he will propose legislation to hold utilities accountable for failures to effectively respond to future power outages. In response to the unacceptable performance of multiple electric and telecom service providers during tropical storm Isaias, the legislation will increase the current legal limits on penalties and create a streamlined process for revocation of a utility’s operating certificate for recurring failures. 

Currently, penalties related to reliability and continuity of electric service, including restoration following a major outage or event, start at $100,000 or .02 of 1% of annual intrastate gross operating revenue, whichever is greater, for each separate and distinct offense.

Penalties rise to $500,000 or .04 of 1%, whichever is greater, for combo gas and electric utilities in the restoration of electric service following a major outage event or emergency.

(Editor’s Note: Con Edison in 2019 reported gross revenues of $13 billion, 343 Million. ($13,343,000,000). If Con Edison is fined under the present rates for the Isaias restoration performance, the fine would be at .04 of 1% of gross revenues: $53,720,000.

Governor Cuomo had been quoted August 20 in The Gothamist as saying Con Ed could be fined as much as $500,000 for its Isaias restoration efforts.

In 2018, Con Edison and Orange & Rockland power companies were fined $10,750,000 for that outage loudly complained about by officials in Westchester and Rockland. End Editor’s Note.)


“The response by the utility companies to Isaias was unacceptable and it’s even worse that they continue to have such problems during storms and in the aftermath. We know these storms are going to happen. We don’t pay for utilities to function on a nice day, the essence of what we pay for is be ready for a storm — give me information when my power goes out and get it back on quickly,” Governor Cuomo said

“The laws are too protective of the utility companies and that has to change. I am proposing legislation that will create penalties that are significant and will force utilities to change their behavior. 

The bill will also create a faster revocation process so that if they’re not providing that service then we will find someone else who can and do it quickly. We must pass this new law and do it right away.”

The Governor’s announcement builds on his announcement last week that he will propose legislation to expedite and clarify franchise revocation procedures. This provision will address questions including the ownership and transfer of assets such as substations, cables and trucks to ensure that the ratepayers who funded them are not charged again in the event of a new operator taking them over.

In addition, the bill will require utilities to clearly communicate with customers during outages and give accurate information regarding power restoration so New Yorkers can make informed decisions and plan based on the time of the outage. 

Governor Cuomo also announced last week that the Department of Public Service has sent Notice of Apparent Violation letters to four electric service providers — Con Edison, Orange & Rockland, PSEG LI and Central Hudson — and telephone, cable and internet provider Altice-Optimum that they now face steep penalties and must take immediate corrective actions so that similar failures are not repeated during the remainder of hurricane season.  DPS is still INVESTIGATING franchise revocations for Con Edison and Orange & Rockland as well as termination of PSEG-LI’s contract with LIPA if the investigation deems it appropriate. 

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