PSE&G gets $80M deal to run Long Island power grid after official, wife's secret stocks sink bidding process
The Long Island Power Authority OK'd the new deal and scrapped a competitive bidding process after authority member John Rhodes and his wife were found to have financial ties to Quanta Services, the company lined up to replace PSE&G.
LIPA CEO John Rhodes and his wife owned up to $120,000 in company stocks with his wife through December 2024 — months after he helped form the selection committee and Texas-based Quanta was recommended as the new manager.
Rhodes pushed Quanta, one of only two finalists alongside PSE&G, saying the company offered better safety metrics and slightly higher customer satisfaction scores.
But LIPA's board members were skeptical.
Critics pointed to Quanta's management of Puerto Rico's electric grid, which has faced rolling blackouts and a government audit.
The LIPA board found out about the undisclosed stocks during an April review of the recommendation and rejected the bid in a 6-1 vote. Rhodes had dumped the stocks four months prior.
'John Rhodes does not own stock in Quanta Services, Inc. Previously, he did own stock in Quanta Services, Inc., having purchased shares in 2021, and sold immediately upon becoming aware of those holdings in December of 2024, prior to LIPA staff's recommendation of Quanta Services, Inc., for selection by the LIPA board,' LIPA spokesperson Jen Hayen told Long Island Business News.
On Thursday, the board voted to scrap the selection process altogether and just extend PSEG's $80 million-a-year contract, which was set to expire at the end of 2025.
The length of the extension hasn't been finalized, although the current deal includes an option for up to five more years.
PSE&G has run Long Island's power grid since 2014, though its performance has faced scrutiny — especially after Tropical Storm Isaias in 2020 left hundreds of thousands of residents in the dark for days.
That led to a restructured agreement in 2021 that tied $40 million of PSE&G's compensation to performance benchmarks, including reliability, storm response, and customer satisfaction.
'We are extremely disappointed by the LIPA Board's decision and the fact that Quanta was never given the opportunity to address any questions or concerns that any of the LIPA Trustees had raised,' a Quanta spokesperson told The Post.
'We hope the reported investigation into this decision sheds light on the procurement process as we can agree that LIPA's 1.2 million customers deserve the best service provider.'
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