Press Release

LIPA seeks audit of clean-energy programs

Feb 28, 2008 (Newsday - McClatchy-Tribune Information Services via COMTEX) -- NGG | news | PowerRating | PR Charts -- The Long Island Power Authority has requested a full audit of all clean-energy programs administered by a division of the former KeySpan, turning a microscope on a $355-million program in which the authority has already identified irregularities.

LIPA is requesting the work be conducted by the internal audit staff of National Grid, which acquired KeySpan last fall.
LIPA watchdogs who have been calling for a full audit of the authority and its contracts and billing practices say they want state Comptroller Tom DiNapoli to conduct a fully independent review. LIPA officials are to meet with DiNapoli on related matters next week.

'I want to see him [DiNapoli] track every dollar that's been spent, inside and outside of LIPA,' Assemb. Marc Alessi (D-Manor Park) said. DiNapoli spokesman Jim Fuchs said the comptroller is 'looking at ways to provide additional oversight' at LIPA on contracts and other matters before a bill to mandate oversight is hammered out.
The audit request, in a Feb. 11 letter to National Grid USA president Tom King by LIPA chief executive Kevin Law, pointed to several potential concerns, including past projects and a rebate program. Law said he will turn over audit results to DiNapoli's office.

KeySpan administered 90 percent of LIPA clean-energy programs, including a controversial seven-year test of fuel cells in which LIPA staff, following Newsday reports, in November uncovered numerous erroneous and missing documents, among other problems.
Another program in which LIPA staff identified possible mismanagement involved payments to Conservation Services Group, a Westborough, Mass., nonprofit firm that conducted public relations and ad-placement services for LIPA through KeySpan. LIPA spokesman Ed Dumas said LIPA discovered double billing and unauthorized mark-ups by a CSG subcontractor. Dumas said the double-billing issue had been resolved, and that 'we're challenging' the billing mark-up claims.

Stephen Cowell, chief executive of CSG, said the contested bills amounted to 'several hundred thousand dollars' over a four-year period. 'It's not a question of propriety,' he said. 'There was no mal-intent on anyone's part.'

Cowell said CSG had identified the double payment issue, and 'returned the money.' The only unresolved issue, he said, relates to 'how we format and itemize the expenditures.'
The LIPA letter also made reference to KeySpan's administration of LIPA rebate programs to encourage consumers and businesses to purchase energy-efficient products. Law said he requested the audit because LIPA is about to embark on new energy efficiency programs and wants to make sure they are properly managed.