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  • Writer's pictureThe San Juan Daily Star

Customers to see 2.75 cents-per-KWh reduction in electricity bill


The energy regulator’s resolution is the product of an accelerated reconciliation process that is activated when, at the end of a monthly billing cycle, it is determined that the actual costs of energy purchases or fuel purchases deviated from the billing of the Puerto Rico Electric Power Authority and LUMA Energy by more than $20 million.

By John McPhaul

jpmcphaul@gmail.com


The Puerto Rico Energy Bureau (PREB) on Sunday approved a resolution that reduces the cost of electricity service by 2.75 cents per kilowatt hour (KWh) for the next two months.


The resolution is the product of an accelerated reconciliation process that is activated when, at the end of a monthly billing cycle, it is determined that the actual costs of energy purchases or fuel purchases deviated from the billing of the Puerto Rico Electric Power Authority (PREPA) and LUMA Energy by more than $20 million. The savings that the determination represents for an average residential customer that consumes 800 kWh in a month is $22.03, with a cost per kWh of 22.7 cents compared to the current cost of 25.4 cents. The savings will be seen by customers in August and September, which are usually the months with the highest electricity consumption in Puerto Rico.


According to the resolution, the accelerated reconciliation was activated when, at the end of June, LUMA had a deficiency of collections for the purchase of fuel of more than $48 million. However, in the reconciliation conducted by the PREB, that deficiency was compensated with the following three items:


1. PREPA received notification from the Federal Emergency Management Agency (FEMA) on March 11, informing the PREB that on July 8 it would be increasing the reimbursement for the purchase of more expensive fuel for the operation of PREPA’s plants from 75% to 90% as a result of the emergency caused by the 2020 earthquakes. The PREB ordered that the net impact of thE FEMA determination, some $34 million, be credited in favor of the clients since the amount had already been invoiced.


2. With the reduction in the cost of oil in recent weeks, the projection of PREPA’s spending on fuel purchases for the next two months was reduced by $69 million compared to the reconciliation approved at the end of June 2022. The PREB ordered that the amount be credited in favor of customers.


3. PREPA informed the PREB that Naturgy would be paying a penalty for the lack of natural gas supply to the Costa Sur 5 and 6 units during the period from April to June 2022. The PREB ordered that customers be credited more than $14 million as a result.


“The role of the Energy Bureau is to ensure the public interest. In the exercise of this function, the Bureau ensures that the consumer is only charged for the actual costs to produce, transmit and distribute energy, not a penny less, nor a penny more,” PREB Chairman Edison Aviles Deliz said. “Today, once again, the value of having an independent entity with open and transparent processes that supervises the prudence of the decisions made by electric power producers in Puerto Rico is demonstrated.”

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