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State fires National Grid auditor for plagiarism, 'pervasive lack' of analysis

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State fires National Grid auditor for plagiarism, 'pervasive lack' of analysis

New York regulators removed the consulting company selected to audit three National Grid USA utilities, alleging portions of its draft audit were plagiarized and provided little independent analysis.

The New York Department of Public Service, or DPS, terminated a contract awarded to Saleeby Consulting Group, or SCG, to audit the management and operations at Niagara Mohawk Power Corp., Brooklyn Union Gas Co. and KeySpan Gas East Corp. The DPS alleged in an Oct. 2 letter that the SCG's work "does not meet the standards of professionalism" required by the state.

"Of primary importance, the department identified several instances of material taken verbatim or nearly verbatim from Internet sites and other sources and presented as SCG's analysis in the draft report without identifying the material as quotations," the DPS said in the letter signed by Utility Supervisor Jeremy Routhier-James. "Throughout many chapters of the draft report, there is a pervasive lack of any independent analysis of the practices of National Grid USA."

SCG did not respond to requests for comment.

The department selected Orange, N.J.-based SCG in September 2018 to perform a comprehensive review of National Grid's New York operations, breaking with its history of soliciting separate audits for the three companies.

The contract authorized the SCG to bill National Grid up to $2 million over the course of its review. The audit would assess key aspects of the utilities' business, including their operational efficiency, whether their construction programs were adequate to ensure reliable future service, and their ability to respond to Gov. Andrew Cuomo's signature energy strategy. These audits have historically led to recommendations from the DPS to utilities to improve management and operations.

The SCG submitted a draft report to the DPS on Aug. 29. One week later, the DPS notified the SCG that the staff had "serious concerns with the quality" of the work. The following week, the DPS ordered the SCG to stop all work on the project.

The department charged that the SCG performed an inadequate cost-benefit analysis to support its recommendations and employed an unauthorized editor to develop the report.

The DPS also said it found a consistent pattern of the SCG using text authored by other sources — including National Grid itself — that was lightly modified, if at all, "in what can only be interpreted as an attempt to create the appearance that SCG authored the text."

SCG, led by president and CEO Raymond G. Saleeby, pitched itself as a "nationally recognized" leader in utility industry consulting with decades of experience. It highlighted its 2016-2017 work auditing Southern Connecticut Gas Co. and Connecticut Natural Gas Corp. It also noted the New Jersey Board of Public Utilities selected SCG as one of a handful of consultants qualified to bid on state utility audits.

The DPS has now ordered SCG to turn over any interview notes and transcripts and other documents gathered or produced throughout the project. The department said it will not authorize any further payments to SCG and will consider other actions it can pursue against the firm.