State investigation: ComEd should pay for outages

Prolonged outages that at one point left more than 800,000 people in Northern Illinois without power during last summer's storms were not unpreventable acts of God, but were caused by years of neglect of equipment and lack of tree-trimming by ComEd, according to a report from the Illinois Attorney General's office.

If the Illinois Commerce Commission agrees with the AG's findings the utility could be required to pay claims to people who lost refrigerated food and suffered other damages because of outages.

The Tribune reported in October that the ICC has never held ComEd liable for damages in extreme outages -- defined as those that leave more than 30,000 customers without power for at least four hours and could have been prevented.

ComEd, a unit of Chicago-based Exelon Corp., has maintained that storm-related outages cannot be prevented because they are caused by nature.

In a statement, ComEd said: "Last summer's wave of storms were among the worst in decades and we understand the frustration that 2.5 million outages can cause for the customers who experienced them. We also understand that even though ComEd's system reliability and outage restoration performance compares favorably on a national basis, our customers are seeking a stronger response." The utility also said it was looking to add technology to improve its service.

The attorney general's report, filed Thursday with the ICC, shows that it investigated ComEd's infrastructure in 12 towns and uncovered decrepit utility poles, equipment choked by vegetation and dangerous conditions related to transformers that haven't been replaced since the 1950s, carrying loads far beyond their designed capacity and outdated technology that aids in the spread of outages and makes them more difficult to repair.

"The singular root cause for the very large number and very long duration of outages experienced by ComEd's customers is clear and evident neglect of its distribution facilities over the past 20 years," the AG's office said in testimony included in its report.

The ICC staff also filed testimony Thursday calling ComEd's interpretation of state law "untenable" because the threshold for requiring payment would in all likelihood never be met. The law states that 30,000 customers must be without power for four hours or more to trigger compensation, but as ComEd sees it, outages that start and stop at different times and affect multiple pieces of equipment (or circuits) cannot be aggregated to reach that number.

"No single outage on an individual primary voltage distribution circuits could result in an interruption of service to more than 30,000 customers because none of these distribution circuits supply that many customers," staff testified.

The AG's office based its findings on a three-day investigation this December of ComEd's infrastructure in suburbs that were hard hit by outages in this summer's storms: Elmhurst, Evanston, Highland Park, Lake Forest, Park Ridge, Rockford, Rolling Meadows and the villages of Arlington Heights, Glenview, Morton Grove, Niles and Schaumburg.

"The AG's office embarked on this investigation in response to ComEd's waiver request and in response to the public outcry that arose following the storm outages. -- including at hearings and forums held throughout the service area," said Robyn Ziegler, spokeswoman for the AG's office.

Rather than being caused by "unpreventable damage due to weather," many of ComEd's outages could have been prevented with more consistent tree trimming, the AG's office argued. ComEd's stated policy is that trees should clear lines by at least 10 feet, but many electrical lines in alleyways and behind residences "revealed years of vegetation management neglect," the report states.

"Had ComEd maintained a sufficient tree-trimming program in these areas, many of the outages would have been avoided or shortened," the report concludes.

In Lake Forest, Carina Walters, assistant city manager, reported that while ComEd has said trees are trimmed on a five-year cycle, at least one residence had a tree that would consistently sway into a power line and spark.

A number of homeowners, she said, lost hundreds of dollars of food more than once after suffering three long outages during the summer but were told by ComEd that they would not be reimbursed because the storms were an act of nature.

ComEd has said in testimony in the case -- in which they are seeking a waiver of liability for outages that occurred during six separate storms that occurred in June and July of 2011 -- that its entire distribution system conformed to national standards when the storms occurred.

The utility has said the outages did not result from poor maintenance.

The AG's office calls that statement "blatantly untrue."

Besides overgrown vegetation, inspectors alleged to have found:

-- Over loaded distribution poles in violation of national requirements.

-- Aging poles -- a quarter of which are 50 to 60 years old -- leaving them open to cracking, splitting and rot.

-- Overheating transformers that haven't been replaced since the 1950s, carrying loads far beyond their designed capacity.

-- Outdated technology that aids in the spread of outages and makes them more difficult to repair.

-- Underground cables forced to perform years beyond their life expectancy.

-- That the absence of smart meter technology had no impact on the number and duration of outages

Taking the middle ground, ICC staff testified Thursday that ComEd should be waived of liability for some outages -- those directly caused by lightning strikes or uprooted trees.

The outages were so bad in Highland Park, Mayor Nancy Rotering testified, that they had to set up Dumpsters at the city's expense all over town so that people could get rid of their spoiled food.

For the July 11, Highland Park estimated it directly spent more than $57,000 dealing with the outages. At the same, Rotering said, there was the cost of students missing school, businesses closing, public health and public safety issues "all caused by ComEd's poor response to the storms."

Adding together all customers who experienced interruptions during any single four-hour period, the ICC determined that all six of the summer storms caused prolonged outages for more than 30,000 customers for a four-hour period. After eliminated outages caused by lightning and uprooted trees, staff determined that three storms still created preventable power outages for at least 30,000 customers for four hours or more. If the ICC agrees, it would open ComEd to claims from more than 550,000 customers.

That interpretation of the law would also open ComEd up to claims from cities and towns that paid thousands of dollars in overtime to police, firefighters and other personnel because of prolonged outages.

Fred Vogt, director of public works for the City of Rolling Meadows, testified to the ICC that the trees contacting electrical lines have caused outages for days at a time. During the July 11 storm, he said, city offices fielded hundreds of calls and a 911 call center received more than 1,000 calls related to the outages.

"We estimate that the storms cost the city thousands of dollars in overtime costs and lost productivity during outages to public buildings. It is difficult to estimate effects on businesses and residents," he said.

He said he disagreed with ComEd's interpretation that an outage is defined by its start and stop time and it place of origin, not by adding together affected customers.

"Regardless of whether the outages are caused by one or several sources," he said, "when so many people are out of service at the same time and outage times drag into days, customers and municipalities suffer losses that should be compensated."

ComEd has two weeks to respond to the report. There is no deadline set for the ICC to decide on the waiver application.