$18 M Fine For Con Ed Not Enough, Say Lawmakers
BY JOHN TOSCANO

Onorato, beside calling the fine a just decision, also said it doesn't come near to compensating the victims of the blackout for the damages they suffered.

Western Queens lawmakers had mixed reactions to Con Edison's being slapped with an $18 million charge last week by the Public Service Commission (PSC) for failing to meet certain reliability targets in 2006. Most said it didn't go far enough.

State Senator George Onorato viewed the payback to the giant utility's customers as "a very just decision because it gives Con Ed a taste of its own medicine".

Onorato, beside calling the fine a just decision, also said it doesn't come near to compensating the victims of the blackout for the damages they suffered.

"Although the PSC did the right thing by fining Con Ed by failing to operate responsibly, the rebate to customers won't go very far at all and the company will be recouping it and then some with future rate increases," he said.

City Councilmember Peter Vallone Jr. said, "Diverting money from stockholders to ratepayers is a good start."

Vallone added, "This action is more evidence that this unreliable monopoly should be denied the opportunity to raise rates and hurt residents even more." Vallone had referred to Con Ed's application to the PSC for an 18 percent rate increase.

Assemblymember Michael Gianaris said the $18 million "fails to even scratch the surface of what is necessary to hold Con Edison accountable for its poor performance in 2006".

Gianaris had called for sharply higher increases in compensation from Con Ed to local businesses for damages resulting from the 2006 nine-day blackout.

Following the PSC's action last week, he said, "The only changes that will have a real impact on Con Edison's performance are my proposed reforms to force competition and greater oversight into Con Edison's business model.

"I will continue to fight for these necessary dramatic reforms and will remain unsatisfied until they are implemented."

The $18 million fine will give the utility's 3 million customers about $6 each.

In announcing the $18 million fine, PSC Chairwoman Patricia Acampora stated, "One of the commission's foremost area of concern is to ensure that electric distribution systems are safe and reliable.

"Con Edison did not meet four targets for system wide reliability in 2006. As a result of the utility's failure to meet these important targets, shareholders are directed to provide a credit to ratepayers. Hopefully, this sends a message to Con Edison that they must be diligent in efforts to maintain a reliable network, or they will face financial consequences."

Earlier this year, Con Edison filed its annual performance report for 2006 with the PSC, describing the company's compliance with its electric service Reliability Performance Mechanism (RPM). The company reported that it failed to meet four threshold targets: network interruption frequency; radial interruption frequency; network interruption duration and radial interruption duration.

Under the terms of the RPM, which was adopted as part of the utility's rate plan in 2004, these failures resulted in the $18 million revenue adjustment that is to be deferred for the benefit of ratepayers.

In response to the PSC's fine, Con Edison issued a statement saying, "We have learned many lessons from the outage in Long Island City as well as from the Westchester storms. Those lessons are already being applied to our policies and procedures to help prevent outages and ensure more rapid restoration when they occur."