Energy Bureau orders new assessment of temporary generation needs

Aguirre Power Plant in Salinas, which was to have been the site of a facility that would supply 400 megawatts of electricity on a temporary basis under an emergency-generation contract with Power Expectations that was cancelled.

By THE STAR STAFF

The Puerto Rico Energy Bureau (PREB) has directed power grid operator LUMA Energy to deliver an updated analysis of the island’s temporary generation needs within 10 days, citing major shifts in the condition of the power system and the recent cancellation of the Power Expectations emergency‑generation contract.

In a resolution and order made public Thursday, the regulator said LUMA must reassess whether the generation shortfall identified in earlier studies still exists and determine how much temporary capacity, if any, is required to maintain system reliability. The directive comes on the heels of the Financial Oversight and Management Board’s decision to revoke approval of PREPA’s $5.9 billion contract with Power Expectations, Enchanted Rock and Reyes Contractor, an agreement that was supposed to supply 400 megawatts (MW) of temporary generation at the Aguirre Power Plant in Salinas.

As previously reported, the oversight board ordered PREPA to terminate the contract last week after ERock Inc., the holding company of Enchanted Rock, informed officials that its name and signature had been used without authorization. A subsequent letter released by the board showed that ERock had warned government entities as early as June 17 that Power Expectations had fraudulently signed the agreement using a fabricated identity. The board said the procurement was “fundamentally flawed,” noting that Enchanted Rock’s participation was essential because the other consortium members lacked the technical and financial capacity required for the project.

With the contract now void and no temporary generation in development, the PREB said LUMA must revisit the assumptions that shaped its earlier planning. In 2025, LUMA projected a deficit of between 700 and 850 MW, concluding that adding roughly 800 MW of temporary generation would significantly strengthen the grid and reduce the risk of load shedding. A later study for fiscal year 2026 forecast more than 36 days per year with loss‑of‑load events and nearly 200 hours of service interruptions.

The PREB said those projections must be updated to reflect current conditions. Since the original studies were completed, several units have been repaired or returned to service, while others have suffered new or prolonged outages. Additional resources -- including battery storage, demand response and new generation -- may also have changed the system’s capacity outlook.

“The need for temporary generation must be evaluated based on the current conditions of the system,” the PREB wrote, adding that no capacity tied to contracts lacking full approvals -- including the canceled Power Expectations agreement -- can be counted as available.

LUMA’s updated analysis must identify whether temporary generation is still needed, quantify any remaining deficit, and explain how system conditions have changed since March 2025. The operator must also update the studies that supported its earlier conclusions and detail the status of repaired units, units still offline, and any new resources that have entered or are expected to enter service.

The PREB emphasized that its order does not assume temporary generation remains necessary. Instead, it seeks to ensure that future regulatory decisions are based on “an updated technical record that reflects the current condition of Puerto Rico’s generation portfolio.”