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Puerto Rico grid privatization costing millions for lawyers, consultants

February 03, 2021

PR Headline News:

Hiring a law firm that charges up to $1,245 per hour. The outsourcing of foreign companies such as Alumbra, from Colorado, which has billed as much as $1.3 million in a single month for plans to transform the energy system without having gone through a competitive process. This is how the first six invoices that LUMA has already submitted to Puerto Rico Electric Power Authority (PREPA) look. Luma is the firm that will manage the transmission and distribution network in Puerto Rico starting in June.

The public corporation does not have the opportunity of reviewing the invoices in a transparent way, Robert Poe, a member of PREPA’s Governing Board said at a meeting on December 16, 2020. His criticism came up because so far, the Public-Private Partnership Authority (AAPP, in Spanish), which oversees the contract with LUMA, has not allowed PREPA to conduct a full review of all of the documents to make sure the expenses are justified. 

“So far there’s no accountability for LUMA’s savings,” said Cathy Kunkel, an analyst at the Institute for Energy Economics & Financial Analysis (IEEFA), which since 2015 has studied and published reports on PREPA’s bankruptcy and electricity system. “It’s an area of concern if LUMA is still going to be relying on a lot of outside short-term contracts without institutional memory of Puerto Rico.” 

[Elivan Martinez Mercado]

More: LUMA Attorneys Charge More Than $1,000 Per Hour and Consultants Almost $5M to Make Plans

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