July 24, 2020 Read More →

House committee begins investigation of Puerto Rico electric power authority

Caribbean Business:

The controversial contracts granted to private companies, namely LUMA Energy LLC and New Fortress Energy, to operate and modernize the Puerto Rico Electric Power Authority’s (Prepa) transmission and distribution system (T&D) and convert utility generators to run on natural gas, became the focal point of a U.S. House Committee on Natural Resources hearing held Thursday on the transformation of the troubled public utility.

The Prepa executive director, the utility regulator chief, and the head of the public-private partnerships agency defended the contracts during the hearing, saying they are vital to ensure the modernization of the island’s power grid. However, the president of the public utility’s largest union and a member of a community group advocating solar-powered energy denounced the privatization of Prepa operations as a giveaway to private companies that will not ensure the meeting of renewable goals and will lead to higher electricity rates.

A report released last month by the Institute for Energy Economics and Financial Analysis (IEEFA) argued that the contract process was plagued by irregularities that provided unfair advantage to New Fortress, which had limited experience in Puerto Rico.

New Fortress reportedly filed its response this week in which it argues that FERC has no jurisdiction over the project because the gasification of the San Juan power plant via a 75-foot pipeline is equivalent to providing such fuel to homes, and was built on public property, not privately owned land such as was the case of EcoEléctrica and the Aguirre Gas Shore Port, which did have to request FERC approval. 

[José Alvarado Vega]

More: U.S. lawmakers inquire about controversial LUMA, New Fortress contracts with Prepa

Posted in: IEEFA In the News

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