In October 2010, Charles Shivery negotiated a merger between his Northeast Utilities and NStar ”“ a $17.5 billion deal stamping his legacy on what will become the dominant New England utility.
As his Northeast Utilities spends the next several weeks completing that merger, Shivery will have ample opportunity to gauge the long-term impact on his legacy of two major storms the past few months ”“ and opportunity to provide his own take on the matter if he chooses.
The state of Connecticut launched hearings into Northeast Utilities and other utilities”™ response to the October nor”™easter, with the CEO of New Haven-based UIL Holdings Corp. scheduled to testify, but with Northeast Utilities arranging for several vice presidents to do so, rather than Shivery ”“ his top lieutenant Lee Olivier, or Jeff Butler, president of subsidiary Connecticut Light & Power Co.
Butler is now out, with Shivery saying he “reluctantly” accepted Butler”™s resignation while praising the longtime Pacific Gas & Electric veteran”™s commitment to the job in the short time he was with Northeast Utilities.
The company named James Muntz as Butler”™s replacement, reporting to CL&P CEO Olivier, and named William Quinlan senior vice president of emergency preparedness, a new position, with Quinlan having most recently having held the role of vice president of customer solutions. The company also named Dana Louth to the position of vice president of infrastructure hardening, to find ways to make the company”™s systems better able to withstand storms.
Blackout-addled customers are haggling for a piece of a $10 million recovery fund fronted by Northeast Utilities, with some saying it is not a sufficient amount to cover the cost and inconveniences to large portions of a state with 3.4 million residents.
Even as CL&P works to restore customer confidence after restoring electricity to homes, some dark 10 nights, Northeast Utilities executives made clear in a third-quarter conference call that they have already shifted their outlook to a new era in combination with Boston-based NStar. When complete, Northeast Utilities CEO Shivery will become chairman, with NStar CEO Thomas May leading the combined company.
“It”™s becoming increasingly outdated, if you will, to talk about the NU standalone story,” said David McHale, CFO of Northeast Utilities, in a conference call with investment analysts a week after the storm. “We are on the eve of this merger and there will be no NU standalone; there will be no NStar standalone.”
McHale added that Shivery and Olivier skipped the call in order to focus on restoration efforts.
“This storm disrupted the lives of more than 830,000 CL&P customers,” Shivery said, in a written statement released after the storm. “I understand the hardship that this has caused and I realize that we did not meet the goals that we set for ourselves and upon which many of our customers relied, and for that I apologize.”
Shivery has spent his career in the power industry, joining Baltimore Gas & Electric where he interned summers while attending John Hopkins University, having grown up on Maryland”™s east shore. He would rise to become co-president of Constellation Energy Group, before joining Northeast Utilities in 2002.
Since then Shivery has volunteered his time to myriad nonprofits ”“ only last year the New England Council named him one of three “New Englanders of the Year,” along with U.S. Sen. Susan Collins and historian Doris Kearns Goodwin.
Still, for the large number of people in his adopted home of Connecticut, Shivery is known mostly through the lens of Northeast Utilities and CL&P. The company routinely ranks below its peers on J.D. Power surveys on residential customer satisfaction, and Connecticut has the second-highest electricity rates in the nation, which businesses say discourages key industries like manufacturing from investing here.
Yet on other fronts Northeast Utilities has a sterling record against its peers ”“ for instance, Newsweek recently named it the second “greenest” utility in the nation, after Con Edison.
For now, the company finds itself facing the prospect of doling out greenbacks to some of the 800,000-plus customers who suffered power outages in the nor”™easter ”“ and facing the ire of a state government reviewing the regulatory landscape as Northeast Utilities works to complete its merger with NStar.
“We will all be one happy family,” May predicted. “We”™re focused on great service to our customers. We believe that translates into good strong regulatory relationships and you all know that regulatory relationships are the key to financial success (in) the long term.”
