ELECTRIC FRANCHISE DUE DILIGENCE
LOCATION: NASSAU and SUFFOLK COUNTIES, NEW YORK
MARKET SECTOR: ENERGY UTILITY
This confidential Long Island Electric Utility Service Provider (ES Provider) entered into a long-term service agreement with the Long Island Power Authority (LIPA). Prior to executing the agreement, the ES Provider required a due diligence study to evaluate the existing real estate assets then the development of a list of the environmental compliance requirements and recommended environmental policies.
The goal of the ES Provider’s due diligence period was to understand the environmental risks with the existing real estate assets as well as to develop a strategy to mitigate these risks. Further, the expedited due diligence period was limited to 6 months. The ES Provider was only interested in the electric utility transmission and distribution infrastructure and the associated real estate assets, which required the separation of the not applicable gas utility services.
In addition, the due diligence efforts studied complicated environmental remediation and land use sites with complex property ownership histories.
THE PS&S SOLUTION
PS&S worked closely with the ES Providers' environmental and general counsel to develop the due diligence framework and reporting requirements. PS&S assembled a team of environmental engineers, scientists, planners, and geographic information system (GIS) specialists to gather and evaluate the necessary information.
PS&S’s long-term relationships with LIPA, the former LIPA service provider, and the ES Provider enabled the expedited review of documents and the real estate assets.
Further, PS&S’s strong understanding of the New York State (NYS) Department of Environmental Conservation (DEC) and NYS Department of the State (DOS) regulatory requirements enabled the ES Provider’s counsel to understand the real estate asset Site specific environmental compliance requirements.
As part of the due diligence process, PS&S evaluated and identified the compliance requirements for hazardous materials storage plans, NYS DEC Part 370 and Part 373 Permits, Waste Transporter Permits, County Petroleum Storage Permits, State Pollution Discharge Elimination System (SPDES) Permits, Spill Prevention and Countermeasure (SPCC) Plans, and General Wetland Permits.