State commission recommends LIPA becomes a fully public utility

State commission recommends LIPA becomes a fully public utility
(Photo courtesy of the Legislative Commission on the Future of the Long Island Power Authority)

A state commission on Friday voted to approve a final report and proposed legislation to make the Long Island Power Authority a fully public utility. 

If accepted by the state Assemby, Senate and Gov. Kathy Hochul, it would remove PSEG: Long Island and allow LIPA to maintain Long Island’s electric grid. The power authority currently contracts its day-to-day operations to PSEG: Long Island.

The bipartisan legislative commission on the future of LIPA was created in 2022 to create an action plan for implementing a more effective operational model for how the organization serves Long Islanders.

Since being created, the board formed a 15-member advisory committee, conducted nine public hearings and received testimony from hundreds of people. 

The proposed legislation will be submitted in both houses of the state Legislature at the start of the legislative session in January. 

The commission’s plan projects to save between $50 to $80 million a year by eliminating annual fees paid to PSEG, allowing LIPA’s board to mitigate future rate increases, upgrade grid infrastructure and invest in green initiatives, among other things. 

State Assemblyman Fred Thiele Jr., co-chairman of the commission, said the report allows LIPA to return to providing cost-effective and dependable services for its customers. 

“The report demonstrates the potential to save over $500 million over the next decade while reforming the LIPA Board through the appointment of 5 members by local governments and the creation of a Community Stakeholder Board,” Thiele said in a statement. “Accountability, oversight and transparency will be enhanced while eliminating costly outside management fees. These public benefits can be realized while still protecting the rights and benefits of our respected local workforce.”

Commissioners voted 5 to 1 to approve the report and proposed legislation, with state Sen. Monica Martinez (D-Brentwood) voting against it.

The entire board of commissioners is made up of eight total lawmakers from both state Legislative chambers, but two were not present at the session where the vote was made. 

Additional changes include restructuring the current nine-member LIPA board to 13 trustees with two selected by Hochul, two each selected from the state Legislature and state Senate, two appointed by Nassau County officials and two appointed by Suffolk County officials.

The final three trustees would be selected by New York City, a 26-member group of community stakeholders and a labor union. Trustees would also be paid $25,000 per year according to the report. 

The Department of Public Service’s oversight is preserved in the plan and allows the state comptroller to establish guidelines and thresholds for pre-approval of LIPA contracts. 

State Sen. Kevin Thomas (D-Levittown), who also was co-chairman, thanked all those involved for their involvement in the final report, saying the findings are a testament to their efforts over the last year.

“I want to thank the dedicated individuals whose tireless efforts and commitment to affordable and efficient utility services have culminated in this final report,” Thomas said. “The Commission’s findings stand as a testament to the hard work of those who provided testimony, expertise, and input over the last year.”


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