March 4, 2021

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They testify before Congress for and against the agreement with LUMA


Several personalities related to the Electric Power Authority (PREPA) and the energy industry in Puerto Rico deposed at a hearing before the Natural Resources Committee of the House of Representatives that addressed, among other things, the energy transformation of Puerto Rico and the concession of PREPA transmission and distribution operations to the private consortium LUMA Energy, under the system of a public-private alliance (APP).

Among the deponents before the commission chaired by Congressman Raúl Grijalva, were the director PREPA executive José Ortiz and executive director of the Authority for Public Private Alliances, Fermín Fontanes, who on behalf of the government defended the agreement with the consortium.

As they have done since the announcement of the APP with LUMA, assured that the agreement would not imply increases in the rate or layoffs of employees, and that on the contrary it would mean a step towards efficient service and of excellence that the people deserve.

Edison Avilés, president of the Energy Bureau, also deposed.

But the audience also offered an opportunity to express themselves to entities and unions that declared their opposition to the project to put in the hands of LUMA PREPA transmission and distribution operations.

Ruth Santiago, a member of the Queremos Sol Coalition, condemned the agreement that provides multimillion-dollar sums to LUMA without the necessary guarantees to provide the longed-for quality service, which in turn eliminates dependence on fossil fuels, and keep PREPA workers' jobs. On the other hand, he argued, Queremos Sol proposes “the vindication of public utility through citizen participation.”

The president of the UTIER (Union of Workers in the Electrical and Irrigation Industry), Ángel Figueroa Jaramillo, also had a turn. . The labor leader maintained that, although they recognize that PREPA needs to be transformed, the contract with LUMA is harmful to the best interests of Puerto Rico.

In addition, Figueroa Jaramillo, through an interpreter, said that they endorsed the Queremos proposal. Sol, commented that it is a much more profitable one for the Island.

The labor leader condemned that the contract with LUMA gives the consortium broad decision-making powers, as well as the management of billions, as he deems appropriate, and cataloged the agreement as “An incredible waste of public funds that does not serve the best interests of the people of Puerto Rico.”

Josen Rossi, president of the Institute for Competitiveness and Economic Sustainability of Puerto Rico, also participated, who defended investment in renewable energy and called to greater and better regulation of the industry, indicating that there was a great lack of confidence in PREPA's ability to lead the energy transformation that the Island needs.

To questions from the congressmen, Ortiz spoke of plans to divide the Island into eight networks that could operate independently of each other, so that if there is a natural disaster such as a hurricane, the entire Isla. He also spoke of projects to bury and protect lines, particularly in areas close to large industries such as pharmaceuticals, so that they are affected as little as possible by any natural phenomenon.

Representative Paul Tonko, after commenting that PREPA would receive $ 1.9 billion in federal funds to transform the electricity system, and asked Ortiz if the agency had a clear plan to invest them in the best way, including the installation of solar panels.

Tonko also questioned Fontanes about the clause of force majeure that the LUMA contract has, and if it could be used to withdraw if a major disaster occurred.

Fontanes argued the matter was being misinterpreted ndo and that the clause was not designed to be used in that way.

Congresswoman Nydia Velázquez asked Fontanes if LUMA would assume the pension coverage that PREPA workers currently have, and the manager indicated that all the rights acquired would be

The resident commissioner in Washington, Jenniffer González, also participated in the hearing and inquired, among other matters, about the validity and integrity of the process that ended with the hiring of LUMA, to which Ortiz replied that the contract was challenged in court by one of LUMA's competitors, and no irregularities were found.

Representative Darren Soto addressed the issue of resilience, and recalled the disaster that Hurricanes Irma and Maria caused for Puerto Rico's electrical system. He insisted that the recovery funds should be used in the best possible way so that this does not happen again, and insisted that the Island must overcome its dependence on fossil fuels such as oil and coal, and put more emphasis on energy renewable energy and in particular the installation of solar panels and batteries and storage systems.

He asked the participants, specifically, if Puerto Rico could stop using oil and coal by 2030. Ortiz said they were moving in that direction, although they did not absolute assurance could be given because it would depend on several factors.

Congressman Alan Lowenthal, vice chairman of the committee, questioned whether LUMA was able to work with PREPA unions. Ortiz replied that the company that makes up LUMA has operations with a large number of unionized workers, so they should have no problem.

Lowenthal also asked Ortiz about the situation of the huge deficit to pay pensions. The Executive Director said that the matter was the responsibility of PREPA, and that LUMA, in any case, “would stop the bleeding.”

Congresswoman Deb Haaland asked about the recent mention of the possible integration of nuclear energy in the transformation of PREPA. Although Ortiz said that, although it was not a technical problem, he did not believe that there was any community that was willing to accept a nuclear plant in its vicinity.



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