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A new sheriff in town at LIPA: Chief executive KEVIN LAW begins his tenure hoping to spend less, lower consumption and address consumers' main gripe - high rates(Newsday (Melville, NY) (KRT) Via Thomson Dialog NewsEdge) Oct. 19--Even before he began his paid tenure at the Long Island Power Authority this month, newly appointed chief executive Kevin Law showed a willingness to jab at the stickiest issues facing the authority. As unpaid chairman for nine months, he effectively terminated a controversial wind-farm project, sought reviews of LIPA's bonuses and charitable donations, and requested a limited state review of the authority's rates and surcharges. So what will he do for an encore? In an interview this week, Law pointed to an agenda that puts considerably more on the table, from reviewing the authority's costly payments in lieu of taxes, or PILOTs, to moving LIPA's headquarters (he's likely to move from a pricey Uniondale location to one in Suffolk). Law is preparing to release a comprehensive program to cut energy consumption, said he'll reconsider a previously rejected power plant in Huntington, and open LIPA to wider public review. "I don't think there's anything we need to hide," he said. PILOTs -- which are made to counties, towns and school districts -- and other taxes make up 10 percent to 20 percent of customers' bills, and Law said he views them as part of the non-fuel portion of the bills he can address. "I'll be taking a look at how we spend money," he said. LIPA's lease for the Omni Building in Uniondale, where rates of around $40 a square foot are considered pricey, is up in 2010. "I'll take a look at it next year," Law said, indicating a likely move east, perhaps to a smaller, less expensive location. Rethinking status quo As an appointee of Gov. Eliot Spitzer, Law, 47, said he has no qualms about re-examining practices long held as standard operating procedures or disclosing previously closely held LIPA information. Long-time LIPA critics are guardedly optimistic. Assemb. Marc Alessi (D-Manor Park) said while he's "elated LIPA is moving in the right direction," he won't give up his calls for Public Service Commission oversight of LIPA, or for investigations into its awarding of contracts and other practices. "I'm taking a wait-and-see approach on the new management to see what kind of reforms they institute," Alessi said. While Law's planned reforms appease those who have long called for accountability at LIPA, residents such as Frank Valente of Mastic Beach wonder how much influence Law will be able to wield over the biggest gripe customers have about LIPA: high energy bills. Valente, a carpenter, said his latest LIPA bill was $438.82, with around half of it power supply charges. "What's the sense of conserving energy, buying Energy Star this and energy smart that when you don't save with this power supply charge?" he said. "When is it going to end?" Law, noting that the cost of fuel represents 60 percent of energy bills, and that LIPA salaries are less than 1 percent, acknowledged his limitations. "Would I love to lower rates? Of course," said Law, whose LIPA bill last month was $600 atop a $600 oil bill. "But I'm not going to make promises I can't keep." In a month, he plans to unveil an energy conservation-efficiency program to begin aligning LIPA with Spitzer's aim to cut energy consumption by 15 percent statewide by 2015. Law said he plans to examine LIPA's advertising programs, responding in part to critics who have charged that the authority need not preach to price-weary ratepayers in a market where it's the only game in town. "Spending should not be for advertising LIPA, but for education, especially on energy conservation," Law said. He plans to examine LIPA's monthly bills to see if the authority can make them easier to read, and said he'll consider using the mailings to solicit opinions from ratepayers on future projects. Adding key staff The new chief executive said he has met with LIPA's 100 or so staff and assured them that as he works to bring in his team, "I'm not going to go in there with a meat cleaver. I'll go in with a scalpel." He's looking to hire a top environmental affairs officer within a month, and a chief counsel by year's end. He declined to name his preferred candidates. Under Law, LIPA is expected to reconsider a power plant on Spagnoli Road in Melville. That KeySpan Corp.-proposed plant lost out to one now under construction by Caithness Energy in Yaphank. Critics of Caithness have contended Spagnoli Road may have been cheaper to build, with lower taxes and community benefits packages. Former LIPA chief executive Richard Kessel said the KeySpan bid was considerably higher than that of Caithness, but LIPA has declined to release any financial information or the competing bids. Law said he would examine claims about the bids. Law met with National Grid chief executive Steve Holliday earlier this week to discuss their working relationship, and said he would keep that company's "feet to the fire" to live up to its lucrative contract to manage the LIPA electric grid. This week, LIPA issued a request for proposals for a separate power-supply management services contract currently held by KeySpan-National Grid. While Law remains conscious of his public persona as he takes on the most visible job of his career, he said he won't allow popular opinion to sway his decisions. "I'm not going to be afraid to make tough decisions," he said. ON LIPA'S OFFICES will consider moving LIPA's headquarters from its pricey Uniondale location to a less expensive one to the east. ON NEW PLANTS Will reconsider a previously rejected power plant on Spagnoli Road in Melville, which KeySpan had proposed. ON CONSERVATION Will prepare a program to cut energy consumption toward a goal of a 15 percent reduction statewide by 2015. OF INTEREST The Long Island Power Authority became Long Island's primary electric-service provider in May 1988. LIPA delivers electricity to more than 1.1 million customers. To see more of Newsday, or to subscribe to the newspaper, go to http://www.newsday.com Copyright (c) 2007, Newsday, Melville, N.Y. Distributed by McClatchy-Tribune Information Services. For reprints, email [email protected], call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA. |