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Peter Maniscalco-Should LIPA buy Nat Grid generating assets?

August 28, 2009 @ 12:00 am EDT

Members and Friends 

Our speaker this morning was Peter Maniscalco. Peter has been an energy policy analyst for more than 30 years. This and his experience as a professor of environmental ethics has honed his sense of what can happen if the right questions are not asked.

The topic was; What questions should be asked when deciding on monumental changes in policy?  LIPA is considering the purchase of the old LILCO plants that were later owned by Keyspan and are now owned by the British company National Grid.

Let me begin by saying that, when LIPA VP Bruce Germano was asked about the purchase of the plants at an HIA meeting he indicated that only the Barret plant was being considered for purchase at this time.

Having said that LIPA’s financial consultant Lazard is trying to determine the financial viability of buying all the plants. They are also are in the process of hiring a firm to determine the envirnmental liabilities. The environmental section will not be completed within the time frame LIPA set. Here is the question that situation raises. How can they determine financial aspects without knowing the cost of envirnmental liabilities? With asbestos issues, the cost cold be substantial.

The question was raised about the old gas manufacturing sites. The environmental liabilities on these sites are known although the costs for clean-up are probably not known. When the question was asked about those sites being included in any sale, we had the benefit of having National Grid’s Ed Carr in the room, and he assured us that none of those sites were on the same footprint of the electric generating plants, and therefore would not be included.

To our speaker, and to some of the people in our audience, there was a disturbing lack of transparency in the process, and the time frame was too compressed to make a meaningful evaluation of the benefits of a LIPA purchase. The fear expressed is that one day we will wake up and read about the completed deal in the papers, and it may not be a good deal for the ratepayers and taxpayers.

Here are a few more questions posed after the meeting in an email from Shelly Sackstein;

What did LIPA know a number of years ago  that caused them to not exercise their previous options to purchase the Keyspan power plants?

  • If LIPA did not previously exercise their options to purchase those same power plants, what has Grid or Keyspan done in the intervening years to make those power more attractive for LIPA to now acquire them ?
  • If the previous LIPA decision was to not purchase the Keyspan power plants, why did LIPA vote to spend additional ratepayer money to hire, (once again with no RFP or bid process), financial consultants to once again evaluate the same transaction?

Peter Maniscalco came to this meeting with no preconceived notion that some nefarious plan was being hatched, but serious questions have yet to asked and answered. I was encouraged by the participation of so many diverse, and well informed individuals and organizations especially Action Long Island, Shelly Sackstein, LIA Energy Committe Chairman Harry Davitian,  NYPIRG’s Todd Stebbins, and National Grid’s Ed Carr.

 

Details

Date:
August 28, 2009
Time:
12:00 am EDT

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