Approved electricity price reduction to take effect this month

Puerto Rico Energy Bureau Chairman Edison Avilés Deliz

By The Star Staff

The Puerto Rico Energy Bureau (PREB) approved late last week a reduction in the price of a kilowatt-hour of electricity, which will be applied to the electricity rate for the period from April 1 to June 30.

The adjustment, which reduces the cost per kilowatt-hour by 1.7 cents, will save $13 61 cents -- or 6.1% -- for a consumer who averages 800 kilowatt-hours of consumption in a month.

“The role of the Bureau is to take stock in the public interest,” PREB Chairman Edison Avilés Deliz said in a written statement. “That means ensuring that excessive expenses are not passed to the consumer, avoiding the managerial irresponsibility that led the Puerto Rico Electric Power Authority (PREPA) into bankruptcy, but ensuring the operation of the utility. The exercise we have just carried out achieves that balance.”

The result will be a price per kilowatt-hour of 26.18 cents for an unsubsidized residential customer with consumption of 800 kilowatt-hours.

Avilés Deliz said that in the first place, the review contemplates recovering $34.5 million from customers for the purchase of petroleum derivatives to replace natural gas, which had been suspended by PREB order. There is still a controversy of fact as to whether PREPA requested in time that gas be supplied, and/or if New Fortress failed to supply it. While this controversy was being resolved, the PREB had postponed charging the amount to customers in view of the possibility that the parties would reach an agreement.

However, the resolution emphasizes that it was PREPA itself that requested, during the public hearing process as part of consideration of this quarterly review, that it be allowed to charge customers the $34.5 million since “there is no forecast of when such controversy can be finalized.”

“The Authority itself said that, having already passed more than a year, it was appropriate to recover this amount through the invoice,” the PREB chairman said. “If eventually the parties reach an agreement, or the Authority manages to recover all or part of the $34.5 million, the Bureau may in that instance credit the clients the amount in the period in which they are recovered.”

Meanwhile, two events involving excess natural gas declarations, one for $4.1 million for June 2022 and another for $8.8 million for December 2022 and February 2023, also took effect.

The next quarterly review will take place in late June..