Luma Energy Defers $65 Million Worth of Puerto Rico Power Grid Projects, Facing Outcry

Puerto Rico's power grid operator defers $65 million of maintenance and improvement projects due to budget constraints, risking more outages.

The private operator of Puerto Rico's power grid, Luma Energy, has announced a significant setback in the maintenance and improvement of the U.S. territory's electrical infrastructure. The company confirmed on Monday that it is deferring $65 million worth of projects due to budget constraints, with some repairs being postponed for at least a year.

Among the deferred projects are the maintenance of more than 100,000 light posts, fire mitigation measures, and repairs on underground circuits, all of which are crucial for the stability and safety of the power grid.

Impact on Outages

Mario Hurtado, Luma Energy's head of regulatory affairs, warned that the deferred projects pose a significant risk of more outages across the island. He emphasized the potential for public lighting failures due to the lack of maintenance, particularly as Puerto Rico experiences hotter temperatures, increasing the threat of wildfires disrupting power lines.

The budget proposed to Puerto Rico’s Energy Bureau includes $1.3 billion for the entire electrical sector, with 65% allocated to Luma Energy for transmission and distribution. Genera PR, responsible for operating and maintaining the grid, will receive 32% of the budget, while the Puerto Rico Electric Power Authority will receive 3%. Luma's budget aims to prioritize customer service, personnel safety, and renewable energy projects despite the deferment of maintenance and improvement initiatives.

Public Outcry and Political Response

The announcement of deferring millions of dollars’ worth of projects has sparked widespread public outcry, with various figures, including Jesús Manuel Ortiz, a member of the House of Representatives and a gubernatorial candidate, expressing strong disapproval of Luma Energy's actions.

Meanwhile, Governor Pedro Pierluisi has activated the National Guard to assist with the energy crisis and has ordered an investigation into a recent massive blackout that affected over 340,000 customers in the capital, San Juan, and neighboring cities. Additionally, the Energy Bureau is conducting its own investigation and has directed Luma and Genera PR to submit a plan to stabilize the electrical network.

Chronic Power Outages

The crisis unfolds as Puerto Rico, with a population of 3.2 million people, continues to grapple with frequent power outages more than six years after Hurricane Maria's devastation. The island has faced a series of natural disasters and chronic underinvestment, impeding the efforts to fully restore and modernize the power grid.

The recent blackout in mid-June exacerbated the challenges, leaving hundreds of thousands without power during a heat wave. Numerous towns in central and southern Puerto Rico are still awaiting complete restoration of electricity after a transformer failure earlier this month.

The situation has prompted urgent action from government authorities and drawn attention to the ongoing struggles of Puerto Rico's power grid, highlighting the pressing need for sustainable solutions.

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