June 19, 2021

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Energy Bureau asks PREPA to eliminate fossil fuels in its long-term plans

Photo: EFE

San Juan – The Puerto Rico Energy Bureau (NEPR) ordered this Monday the Electric Power Authority (PREPA) to refrain from executing a 10-Year Infrastructure Plan (Plan), submitted to the federal Emergency Management Administration (FEMA ), which provides for new generation resources based on fossil fuels that were rejected in the Integrated Resource Plan (PIR) and the Modified Action Plan approved by the NEPR on August 24, 2020.

According to a press release, PREPA did not submit the Plan to the NEPR.

The NEPR became aware of the filing of the Plan before FEMA through the media. For this reason, on December 30, 2020, PREPA ordered PREPA to submit a copy of the Plan and designated a Technical Conference that was broadcast live on January 11, 2020.

After evaluating it and receiving PREPA’s input during the Technical Conference, the NEPR determined that the Plan is not consistent with the PIR and the Modified Action Plan approved by the Energy Bureau.

The PIR is a planning tool, required by Law 57-2014, which must be evaluated and approved by the NEPR through an adjudicative process, with broad public participation.

The PIR has a 20-year planning horizon, reviewable every 3 years. The PIR must guarantee the development of the electric power system in Puerto Rico, as well as improve the reliability, efficiency, transparency of the system and fair and reasonable costs for consumers.

The PIR includes all reasonable resources to satisfy the demand for electricity services on the island.

Likewise, it leads an aggressive energy transformation (roadmap) towards renewable sources required by public policy.

The PIR approved by NEPR orders the development of at least 3,500 MW of photovoltaic solar generation resources up to a maximum of 3,900 MW by 2025. In addition, it orders the development of at least 1,360 MW of Energy Storage Systems through Batteries, up to a maximum of 1,480 MW by 2025. Likewise, it orders the withdrawal within the next 5 years of a portion of the rapid response units (peaking units) Frame 5, as well as the following PREPA steam units: Aguirre 1 & 2; Aguirre CC 1 & 2; Saint John 7, 8, 9 & 10; Palo Seco 3 & 4; and South Coast 5 & 6.

Through Resolution and Order issued today, the NEPR required PREPA to “immediately refrain from exceeding the scope and budget assigned in the approved PIR and the modified Action Plan” for a combined cycle generation plant in Palo Seco. The NEPR only approved 5 million dollars for preliminary studies associated with said plant, the development of which requires the express approval of the NEPR.

It also ordered PREPA to refrain from making capital investment in its generation fleet or the Transmission and Distribution system, without the prior approval of the NEPR. Likewise, PREPA must “immediately refrain from using its plans and studies as a collateral attack on the Approved IRP and the Modified Action Plan.”

The NEPR determined that PREPA’s 10-year Infrastructure Plan should be reviewed immediately because “it does not comply with the approved IRP and the Modified Action Plan.”

The regulator warned PREPA that failure to comply with its orders or applicable legal requirements may lead to the imposition of administrative fines of up to $ 25,000 per day for each violation and / or other sanctions that the NEPR deems appropriate.

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