Puerto rico government

House lawmakers demand answers from LUMA Energy regarding Puerto Rico’s failing power grid

Dive brief:

  • House Democrats on a Friday letter asked the head of Puerto Rico’s electricity utility, LUMA Energy, for details on staffing, expenses, executive compensation and a series of power outages since the company took over grid operations from the Puerto Rico Electric Power Authority (PREPA) this summer.
  • The questions follow a hearing on Wednesday in which LUMA President and CEO Wayne Stensby called the island’s electrical system “arguably the worst in the United States,” but declined to answer questions about utility wages and could not provide statistics on the experience levels of line workers of the company. Lawmakers said one of the reasons for LUMA’s difficulties was the company’s low level of staff.
  • The utility, owned by ATCO and Quanta Services, is making progress in partnerships to restore the island’s grid, announcing on Monday an agreement with a local electrical industry cooperative for more than 100 workers to work with LUMA in the activities of network restoration.

Dive overview:

Since LUMA took over the network from Puerto Rico in June, “conditions have deteriorated,” lawmakers said in their letter demanding responses. “One of the potential reasons for these issues is the size and experience of LUMA’s workforce.”

The “problems” they point to include a substation fire that cut power to 800,000 customers and service complaints being more than twice as frequent as they were under PREPA.

Puerto Rico‘s network is “widely known to be outdated, fragile, and unique among networks in the United States.” Those with the most experience operating and repairing the network would be more likely to anticipate, prevent and quickly mitigate issues that could lead to outages, ”wrote Rep. Katie Porter, D-Calif. ., and Representative Raúl Grijalva, D-Arizona, in their joint letter to Stensby of LUMA. “A shortage of workers would mean longer response and repair times.”

Porter is Chairman of the House Subcommittee on Oversight and Investigations; Grijalva is chairman of the House Committee on Natural Resources.

The worker shortage was at the center of Wednesday’s hearing, which examined PREPA’s transition to serving LUMA. Agustín Irizarry-Rivera, professor of electrical engineering at the University of Puerto Rico in Mayagüez, asked the committee to investigate “the lack of qualified personnel to properly operate the electrical system.”

According to the letter from lawmakers, more than 3,000 of PREPA’s 4,200 transition-eligible employees “did not move to LUMA and instead transferred to other departments of the Puerto Rican government.”

Lawmakers have asked the utility for a detailed breakdown of the number of employees and their levels of experience in various positions, including line workers, control center operators and substation technicians. Other requests include documents related to summer outages, power plant maintenance, staffing and recruitment, and “documents sufficient to show the allowances and titles of LUMA employees for whom compensation is paid. total exceeds $ 200,000 “.

LUMA is making progress in sending more workers to fix Puerto Rico’s aging system. On Monday, the utility announced that it had signed an agreement with the Cooperative of Electricity Industry Professionals of Puerto Rico and the Caribbean (Electricoop) to “restore the electricity grid”.

The agreement “will contribute to LUMA’s already ongoing work in stabilizing and restoring the electricity transmission and distribution system,” LUMA external affairs adviser José Pérez Vélez said in a statement.

However, some observers doubt that Electricoop has the expertise required by LUMA.

“They don’t seem like they are trained linemen, that’s what LUMA really needs”, Cathy Kunkel, former analyst at Institute of Energy Economics and Financial Analysis, said in an email. Kunkel now works with CAMBIO PR, which promotes sustainable solutions for Puerto Rico.

The island’s power system was destroyed in 2017 by Hurricane Maria, and efforts to rebuild and modernize it are underway. The Federal Emergency Management Agency has authorized $ 9.6 billion to help with these efforts and the projects are starting to unfold.

While PREPA continues to own the island’s power plants, LUMA operates the distribution and transmission system through a public-private partnership designed to save customers money, improve grid resilience and add renewable energy. But the deal raises growing doubts.

NBC Nightly News covered Puerto Rico’s power issues on Monday, report the grid is in “critical condition” and the PREPA is “under fire”.

A resident told NBC his electricity bills were more than 50% higher under LUMA, but with degraded service. Meanwhile, utilities CEO Stensby touted the company’s work on customer service and promised “it will get better.”

Lawmakers note that despite LUMA’s problems, the utility has already attempted to increase tariffs “despite promises to keep them constant for the first three years of operation.” The Puerto Rico Bureau of Energy recently rejected LUMA’s request to recover $ 52 million in additional fuel and other costs in June and July.

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