Puerto rico government

Stop privatizing Puerto Rico! – The world of workers

The United States-imposed Tax Control Council continues to try to impose all possible neoliberal policies of privatization on the people and island of Puerto Rico. People have continued to fight, more recently against LUMA Energy, the private contractor who took over operation of Puerto Rico’s electricity grid on June 1.

The letter to the US Congress describes the reasons it called for an investigation into LUMA. The letter was published with the following statement from Amigos Río Guaynabo, Asociación de Empleados Gerenciales AEE, CAMBIO, Coalición de Organizaciones Anti-incineración, Comité Diálogo Ambiental, El Puente, Institute for Energy Economics and Financial Analysis (IEEFA), Sierra Club of PR, UTIER [Unión de Trabajadores de la Industria Eléctrica y Riego] and other organizations.

In San Juan, Puerto Ricans protested the privatization of energy under LUMA Energy on June 1. Credit: Alejandro Granadillo

We live in the ravages of poor service and thousands of Puerto Ricans without electricity on a daily basis, as LUMA does not have enough staff with the necessary experience. In addition, policies to continue to depend on fossil fuels are part of the business policy of LUMA and its parent companies Quanta Services and ATCO Group.

We have prepared a letter to the US Congress, requesting an investigation into the allocation of billions of federal funds to this company. We ask all organizations, institutionsand all the people who canto approve the letter at this link: tinyurl.com/2bx2bavb.

The Honorable Raúl Grijalva, President

House Natural Resources Committee

1324 Longworth House Office Building

Washington, DC 20515
July 20, 2021

Dear Grijalva Representative:

We urge the House Natural Resources Committee to undertake an urgent investigation into LUMA Energy, the private contractor who took over operation of Puerto Rico‘s power grid on June 1 and will be responsible for managing more than $ 14 billion in FEMA funds for reconstruction of the grid.

LUMA’s first month of operations in Puerto Rico was a disaster. LUMA is a joint venture of Texas-based Quanta Energy Services and Alberta-based ATCO. LUMA did not hire the majority of the previous Puerto Rico Electric Power Authority (PREPA) workforce.

Failing to hire a trained and experienced workforce, LUMA was unable to properly manage the grid, putting lives and property at risk due to prolonged outages and voltage fluctuations that caused fires and tens of thousands of dollars in damage. Under the contract, LUMA receives a fixed fee of over $ 100 million per year to operate the network regardless of its performance.

LUMA has disrespected the Puerto Rican legislature, forcing the legislature to go to court to try to compel LUMA to provide information on the number of linemen at the company, where its Puerto Rican call centers are located. Rico and other basic information. As you know, LUMA also did not appear to testify at a meeting on June 30. Hearing of the House Natural Resources Subcommittee on the AES coal-fired power plant in Puerto Rico.

This debacle wouldn’t happen without the influx of billions of dollars into FEMA and the CDBG HUD [Community Development Block Grant] funds in Puerto Rico. Under its contract, LUMA Energy will manage and subcontract federal funds without having to invest its own money in the grid.

Allocating more than $ 14 billion in federal funding to Puerto Rico’s power system presents a historic opportunity to transition to a reliable and decentralized grid based on rooftop solar power, as community organizations have long advocated, environmental and trade union organizations in Puerto Rico. However, LUMA has shown no interest in moving in that direction, instead focusing its plans on rebuilding a hardened, centralized system like the one that collapsed in Hurricane Maria.

LUMA’s lack of transparency and its inability to provide reliable electrical service raises several pressing questions, including:

  • What is the current state and level of training of LUMA’s workforce?
  • Is LUMA ready to handle over $ 14 billion in FEMA and HUD funds?
  • What actions will FEMA and HUD take to ensure that their funds are used to advance the Biden administration’s climate policy and to prevent the procurement process for such funds from becoming a boon to them? LUMA affiliates? What agreements have already been concluded between FEMA, HUD, LUMA Energy and / or PREPA?
  • Why does the Federal Council of Financial Oversight and Management of Puerto Rico continue to support this contract, which has increased costs for the Commonwealth government and does not advance the island’s renewable energy goals?
  • How did this unknown consortium win the Puerto Rico grid operation contract against other bidders with greater expertise in power systems management? What role did federal lobbying from Quanta Energy Services play in the award of the contract?

We hope that your committee will undertake an urgent inquiry to provide the people of Puerto Rico with answers to these questions.

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