Puerto Rico’s Broken Power Utility Is Cutting Its Energy Reserves

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Tim Pearce Energy Reporter

Puerto Rico is cutting back on its operating energy reserve in a move that will cut costs but risk the integrity of an already fragile and troubled grid, the Associated Press reports.

Puerto Rico Electric Power Authority (Prepa) Director of Generation William Rios made the announcement Sunday. The utility is currently seeking approval for $300 million in emergency funding from the federal government.

A federal judge denied a loan request by Prepa for $1 billion, which Congress approved last year. The judge ruled that the state-owned utility did not present sufficient evidence to prove it needed the money and advised the utility to lower the amount requested to $300 million, according to The Wall Street Journal.

Prepa is about $9 billion in debt. Public Affairs Secretary Ramon Rosario has said cutting back the energy reserve by 450 megawatts should save $9 million a month without disrupting power to customers.

“The power company’s fiscal situation is real and we have to deal with it now,” Rosario told the AP.

Nearly a quarter of a million Puerto Ricans are still without power five months after Hurricane Maria passed over the island, wreaking massive amounts of damage on the island’s infrastructure and grid.

$300 million, if approved by Tuesday, would keep the state-run utility funded through late March when officials would have to appear before the judge again asking for more money.

“Time is of the essence,” Prepa lawyers said in court papers filed Friday, according to The Wall Street Journal. “Prepa’s operations are in jeopardy.”

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