Privatization and Elimination of Oversight Further Silences Puerto Ricans Voices

San Juan, Puerto Rico -- More than four months after Hurricanes Irma and Maria struck Puerto Rico, the island is continuing to try and recover. As it does, significant questions have been raised surrounding the future of the Puerto Rican Electric Power Authority (PREPA) and the independent commission charged with its oversight. PREPA is one of the largest public power utilities in the United States, meaning that it is owned and operated by an agency of the Puerto Rican government.

Last week, Puerto Rico Governor Ricardo Rosselló proposed privatizing PREPA. His plan calls for selling off the utility’s generation assets over the next year and a half, and transferring the right to operate the transmission and distribution system to profit-making corporations. Rosselló’s proposal comes on the heels of an initiative to pare down the powers of the Puerto Rico Energy Commission, the entity charged with non-partisan oversight of PREPA. Seeking to invoke an emergency plan that permits the elimination of “extraneous” agencies, the Governor’s proposal risks turning the Commission into a political entity, and would potentially strip any oversight from PREPA or a privatization process.

Also last week, PREPA released its 2018 Financial Plan, which lays the blame on the Commission as being its primary barrier and accuses the agency of overreach. This comes after the Commission has spent the past three years working -- with significant public engagement -- to overhaul PREPA to be more transparent and organized. In 2016, the Commission ran the first public planning process for PREPA. In early 2017 the Commission’s first rate case unveiled core operational and governance problems at PREPA, predicting that PREPA’s deteriorated infrastructure was ill-prepared for an emergency. In response, PREPA has sought to slow down the efforts of the Commission and avoid its obligations to ratepayers. For example, the Commission expressly required that PREPA provide notice of any contract in excess of $25 million, a process which was clearly violated with Whitefish.

This week, the federal Financial Oversight & Management Board for Puerto Rico requested that PREPA be granted the opportunity to borrow $1.3 billion to prop up operations, a move that would circumvent the statutory oversight role of the Commission. The Board is holding a listening session in New York City [Wall Street?] today on the future of PREPA.

If the Governor’s plans to privatize PREPA and reduce oversight come to fruition, experts predict that the Puerto Rican people will see their input diminished even further while private corporations seize control, resulting in even less transparency as the island seeks to rebuild after Hurricane Maria.

This all comes as tens of thousands of Puerto Ricans remain without power and thousands still do not have access to safe drinking water more than four months after Hurricane Maria struck.

In response, Sierra Club Puerto Rico Director Jose Menendez released the following statement:

“Puerto Ricans continue to suffer more than four months after Hurricanes Irma and Maria struck. Now, Governor Rosselló is seeking to add to the dysfunction by selling off the island’s power supply and scrapping the only oversight the agency has. The people of Puerto Rico -- like all Americans -- deserve better. Should the governor’s plan succeed, Puerto Ricans will see their voice further diminished while the current administration continues to refuse to aid the island’s recovery. This is not governing and this is not how American citizens should be treated.

“Governor Rosselló must listen to the people he was elected to represent and empower the Puerto Rico Energy Commission, not silence it. Rossello’s plan is simply a step backwards in Puerto Rico’s recovery. Rather than put up more roadblocks preventing the people from having a say in powering their communities, Rosselló must make the process more transparent and ensure PREPA adheres to the Commission’s request.

“Puerto Ricans deserve a say as their communities rebuild after Hurricane Maria. But, Governor Rosselló’s plans are disingenuous as best, and will only further the problems the island has faced -- not fix them. For Puerto Rico to recover, PREPA must become more transparent and open, and Donald Trump must fulfill his responsibilities and aid Americans who continue to inexcusably suffer.”

Ingrid Vila-Biaggi, President of CAMBIO and former Chief of Staff for the Commonwealth of Puerto Rico, reacted as follows:

“If PREPA’s Executive Management and the Governor are attacking the Energy Commission, then this is a clear signal that the Energy Commission must be doing a good job as an independent and strong regulator.  The Energy Commission rejected PREPA’s request to increase rates, it rejected PREPA’s highly deficient Integrated Resource Plan and it questioned the cost-benefit of the Aguirre Offshore Gasport. In making these decisions the Energy Commission has provided public participation and light to what have been closed, dubious, and obscure decision-making processes at PREPA. This explains why the Energy Commission has gained the trust of diverse and important sectors of our community who usually don’t stand on the same side on issues, such as industry, environmental and community groups. In the past weeks they have voiced their opposition to the Governor’s proposal and reiterated the support to the permanence of the Commission as a strong independent regulator. So as elected officials, I urge the Governor and the Legislature to act in the interest of the people instead of in the interest of partisan politics.”

Myrna Conty, coordinator for the Coalition of Organizations Against Incineration, indicates:

"It's important for the communities to have a independent  Energy Commission to fiscalize PREPA's and Private Electricity Generators in decisión making. Puerto Rico doesn't need any more vultures like Energy Answers, who are taking advantage of Puerto Rico's crisis after Hurricane Maria hit, trying to get their Waste to Energy Plant built in Arecibo. The Energy Commission in its Integrated Resource Plan does not include incineration of solid waste (WTE) projects. We also strongly oppose to the privatization of PREPA. We insist that Governor Ricardo Roselló puts Puerto Ricans' health first as his priorities. A country cannot grow economically if it's people are sick".

Jonathan Smith, Senior Associate Attorney, Earthjustice added:

The people of Puerto Rico deserve a strong, independent utility commission to look out for them, just like those in every other U.S. state.  PREPA spent most of its existence without Energy Commission oversight, and it ended up with sky-high rates and sky-high debt.  Weakening the Commission now, as the Governor seeks to privatize the utility during the post-hurricane crisis, is a recipe for even more disaster.  Puerto Rico needs the Energy Commission now more than ever.