Higher electric bills, accumulating debt, multiple investigations and major outages have plagued Long Island ratepayers ever since the government took control of their power
The takeover took 13 years. When the new state-authorized Long Island Power Authority, or LIPA, finally
got through all the legal battles and bureaucratic wrangling, the cost was $6.7 billion. That was 1998.
Since then, LIPA has gone billions of dollars into debt, its customers’ bills keep going up and it’s been the
subject of multiple investigations for poorly managing the electric grid.
LIPA is the only example of a large publicly owned – privately operated utility in the entire U.S.
Monthly residential bills would jump by 50% in the first few years and the price of a kilowatt hour would be nearly double today – contradicting promises of lower rates
25 years later they’d be $9 billion in debt including $260 million to finally fund employee pensions and benefits – an obligation LIPA denied for the previous 10+ years
400,000 customers would be left without power for a week during the pandemic – an investigation revealed a total failure of communications and outage management systems
Long Island – similar in terms of weather, number of customers and miles of line to Maine – offers insights into what could happen here under Government-Controlled Power.
|Long Island Power Authority||Central Maine Power + Versant|
|Current Structure||Publicly Owned-Privately Operated||Investor-Owned|
|Average Residential Cost||22.74¢ / kwh||18.37¢ / kwh|
|Average Residential Bill||$187.50/month||$144.55/month|
|Number of Customers||1,100,000||805,000|
|Miles of Transmission & Distribution Wires||15,378||33,822|
|Long Island Power Authority||Maine Under Government-Controlled Power|
|Takeover Process||Agreed to Sell||Eminent Domain|
|Time to Complete Acquisition||13 Years||10 Years (estimated)|
|Cost of Acquisition||$6.7 Billion||$13.5 Billion (estimated)|
|Future Structure||Total Government Control||Same Failed Model as LIPA: Publicly Owned-Privately Operated|
“LIPA is the only utility in the nation that is operated under a third-party management model. This model has repeatedly failed its customers. There has been a lack of transparency, oversight, and accountability. This failure has been most dramatically evidenced in the unacceptable storm response by LIPA and its thirdparty contractors during Superstorm Sandy in 2012 and Tropical Storm Isaias in 2020.”
“Long Island utility customers have long paid some of the highest electricity prices in the country. Residents and businesses in the region have raised concerns about such costs, as well as management practices of the Long Island Power Authority (LIPA). Audits, reports and investigations by the State Comptroller and others have identified numerous areas requiring improvement, including adequacy of regulatory oversight, financial management, debt, and storm preparation and response.”
“The new issues identified appear to be only a sampling of LIPA’s structural dysfunction and blatant disrespect for ratepayers…Ultimately, the Commission concludes that LIPA’s bifurcated management structure fails to work not only during weather emergencies, but also during ‘blue sky’ conditions…”
“One of the greatest outrages of Hurricane Sandy was the failure of the Long Island Power Authority. LIPA’s response to the storm revealed that it was unable to perform at a time when customers on Long Island and elsewhere quite simply needed it most.”