(Allison Joyce | Getty Images)

Hurricane Sandy cut power to more than 2 million New York customers, including the worst storm- related electricity loss ever for Consolidated Edison Inc. (ED) that left much of lower Manhattan blacked out.

The storm, which made landfall in southern New Jersey yesterday, left about 8.11 million electricity customers without power from South Carolina to Maine and as far west as Michigan and Indiana, according the U.S. Energy Department. It was the biggest U.S. blackout since 2003, when about 50 million customers across several states were affected by a power line failure in Ohio.

New York, New Jersey and Connecticut were hardest hit by the storm, which felled trees, tore down power lines and swamped electrical systems with record flooding. At least 5.3 million homes and businesses in the states were affected as Con Edison, which sells power in New York City, and New Jersey’s Public Service Enterprise Group Inc. (PEG) grappled with storm conditions the companies said were the worst in their history.

“Restoring power is going to be one of the major challenges for us,” Governor Andrew Cuomo said in a press conference today. Repair crews are coming from as far away as California to help, Cuomo said. About 90 percent of Long Islanders are without power.

Customers in Brooklyn and Manhattan should have power back within four days, New York-based Con Edison said in a statement today. Other restorations may take at least a week. The company reported 780,000 customers without power, including 250,000 in Manhattan.

‘Wall of Water’

Public Service, which owns a utility that supplies power and natural gas to about 75 percent of New Jersey residents, said substations flooded along the Passaic, Raritan and Hudson rivers despite sandbags piled up to divert the water. That knocked out power to more than 1.4 million customers.

“This wall of water that hit the state of New Jersey is not something that we could have prepared for,” Ralph LaRossa, chief operating officer for Newark, New Jersey-based Public Service’s utility, said today on a conference call with reporters. “The sandbagging issue and the concerns we had didn’t match up with where this storm surge hit us in Newark Bay.”

The storm surge also surpassed forecasts in New York, sending floodwaters across lower Manhattan that persisted until early this morning, according to Con Edison. The number of customers affected surpasses the last record power failure, when Hurricane Irene cut electricity to 200,000 Con Edison customers in August 2011.

Assessing Damage

As winds diminished, utility crews today began assessing the devastation and laying plans to repair the grid and restore power.

Orange & Rockland Utilities, a Con Edison subsidiary serving upstate New York, said it would have to rebuild some transmission systems damaged by Sandy’s high winds. Most customers should have power within 10 days, the utility said.

The Long Island Power Authority said customers can expect to be without power for at least seven to 10 days.

Once flood waters recede, Public Service will assess the damage, dry out equipment and replace it where necessary, work that Karen Johnson, a spokeswoman, described as “a slow, painstaking process.”

Saltwater Damage

The storm knocked down more than 200 wires on Staten Island, while leaving more than 180 roads closed in Westchester County, Con Edison said.

Damage from salt water will complicate the massive clean- up, Matthew Cordaro, former chief operating officer of Long Island Lighting Co., said in a telephone interview yesterday. “It introduces a whole host of problems,” including contamination that has to be cleaned.

Sandy’s cleanup costs were expected to exceed $20 billion, Eqecat Inc., an Oakland, California-based provider of catastrophic risk models estimated yesterday.

The total would include insured losses of about $7 billion to $8 billion, said Charles Watson, research and development director at Kinetic Analysis Corp., a hazard-research company based in Silver Spring, Maryland. Cities and states will pick up much of the remaining tab as they repair damaged infrastructure such as New York’s subways and tunnels, Watson said.

Insured losses of $7 billion would “roughly equal” those of Hurricane Irene, Brian Schneider, an insurance analyst for Fitch Inc., said today in statement. Flooding, not typically covered by homeowner’s insurance, will comprise a substantial part of Sandy’s total damage, he said.

Manhattan Blackouts

Con Edison said blackouts in Manhattan, which covered much of the city below 39th Street, were caused by flooding in substations as the storm surge brought water into Battery Park, the East Village and Chelsea. Con Edison killed power in those areas last night to limit damage from salt water reaching its equipment.

“This is the largest storm-related outage in our history,” John Miksad, Con Edison’s senior vice president for electric operations, said in a statement.

Reported outages from New Jersey’s three largest utilities totaled 2.44 million, based on company reports. Long Island Power Authority, east of New York City, reported 943,350 customers without electricity this afternoon. Connecticut utilities reported power was out for 1.4 million customers, or more than a third of the state this afternoon.