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Hurricane Sandy’s costs tallied

December 12, 2012

ALLENTOWN, PA — Pennsylvania Power and Light (PPL) estimates that the cost of Hurricane Sandy to the utility will be $60 to $70 million, and at some point in the future, the utility’s customers can expect to help pay for the storm via charges spread out over several years, according to corporate communications spokesperson Michael Wood.

“The largest portion of the costs is labor related, with more workers mobilized for this storm than any previous storm,” Wood said. PPL employees were joined by utility workers from 56 other companies representing 16 states, for a total of nearly 5,000 personnel working double shifts around the clock to restore power.

“We had more than 4,600 individual repairs, representing the total of 523,000 customers,” Wood said. He cited many localized incidents where “tremendous damage” first needed to be cleaned up before poles and lines could be rebuilt. “It’s very labor intensive, time-consuming, and physically draining work that must be well coordinated to be done safely,” Wood said.

The costs from this storm will be reflected in future rates, Wood said. “Some of the storm costs are covered under our annual budget, which we base on an average of the five previous years’ actual storm costs, and we had storm insurance to cover a portion of the higher costs.” For this year, PPL had budgeted $20 million for storm emergency costs.

To pass on extra costs to customers, PPL will be required to submit a proposal to the Pennsylvania Public Utility Commission (PUC) for permission.