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Battle for Puerto Rico’s Energy Future

Rocky Mountain Institute (RMI) has produced a report laying out “Growing Risks to the Implementation of Puerto Rico’s Energy Transformation.” The report contrasts Act 17 of 2019, a bold law committing Puerto Rico to renewable energy in the future, with the actions that are actually being taken on the Island.

Act 17 calls for 100% renewable energy by 2050. A 2025 milestone calls for 40% renewable energy by that time. Puerto Rico, in spite of being an obvious candidate for solar energy use, had only 2% renewable energy before Hurricane Maria.

The hurricane destroyed much of the Island’s electrical system, and it took 18 months to restore power fully.

Act 17 also outlines a specific process for decision making on energy-related projects. However, in April two major expedited projects were announced:

  • RFQ 2019-2: for the Hydroelectric Power Plants Revitalization Project,4 in which a contractor
    would rehabilitate and operate hydroelectric units at nine existing sites around Puerto Rico
  • RFQ 2019-3: for Flexible Distributed Generation Units,5 in which a contractor would develop,
    construct, manage, and operate 450 MW of new fossil fueled generation units at seven sites
    around Puerto Rico

RMI points out that these efforts are taking place outside of the energy decision making process. “The emphasis on advancing LNG [liquefied natural gas] projects on an expedited basis is inconsistent with the new policy priority of a transition to renewable energy,” they point out. “Continued prioritization of LNG projects and infrastructure may lock Puerto Rico in to decades of fossil fuel dependence and cost.”

Since one of the requests mandates a 25-year commitment, Puerto Rico would indeed be locked into fossil fuels in direct conflict with Act 17.

The report also claims that the estimates used to build out the requests are based on numbers that are “aspirational” — that is, very inaccurate. The estimated fuel savings for switching from diesel to natural gas is $1,186.4 million. However, RMI points out that this figure only makes sense if generators operate at full capacity 90% of the time, instead of the 50% they currently achieve.

The report points out that PREPA’s CEO Jose Ortiz claimed “more than $500 million in savings over five years” in hearings before the US House of Representatives on April 9, 2019. This is less than half the savings estimated in the request.

What’s more, running generators on natural gas at full capacity 90% of the time would be contrary to Puerto Rico’s plan to shift to renewable energy.

RMI does not mention Puerto Rico’s status. However, a 25-year commitment could certainly outlast Puerto Rico’s status as a territory. Puerto Rico has already requested statehood. Nearly 100 U.S. states and cities have passed laws mandating a shift to renewable energy on a timetable similar to that outlined in Act 17. States have the right to make these decisions. The actions referred to by RMI could be incompatible with Puerto Rico’s rights as a state, should the territory achieve statehood during that time.

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