Gothams Energy challenges testimony as fiscal board documents highlight separate contract concerns
By THE STAR STAFF
Gothams Energy has sent a cease-and-desist letter to attorney Osvaldo Carlo Linares following testimony he delivered during a Government Committee hearing in the Puerto Rico House of Representatives examining the procurement process behind temporary power generation contracts intended to bolster the island’s electrical grid.
As previously reported by the STAR, Carlo Linares, president of Regulatory Compliance Services, which administers the Independent Procurement Office (3PPO), testified under oath about the selection process for temporary generation contracts awarded to address Puerto Rico’s ongoing power shortages. During the hearing, he raised concerns involving Gothams Energy’s proposal and identified attorney Anthony Maceira as counsel for the company.
In response, Gothams rejected allegations that it failed to comply with environmental requirements, U.S. Coast Guard regulations or federal eligibility standards. The company said no state or federal agency has found it to be in violation of environmental requirements, and denied claims that it had been suspended, excluded, or barred from doing business by the U.S. Department of State or any federal agency. Gothams also stated that Maceira’s work has been limited to legal representation and did not involve lobbying activities on the company’s behalf.
The dispute comes against the backdrop of a May 2026 review by the Financial Oversight and Management Board for Puerto Rico, which examined a proposed contract between the Puerto Rico Electric Power Authority (PREPA) and Gothams Energy, together with Americas Power Solutions Holdings, for a floating power generation project.
The oversight board did not reject the proposal. Instead, it issued an “Approved with Conditions” determination, requiring PREPA and the contractor to address a series of concerns before the contract could be executed.
According to the board, the project was intended to provide 200 megawatts of temporary floating generation capacity under a 10-year agreement valued at up to some $2.47 billion. The procurement emerged from a competitive bidding process launched in July 2025 to address an anticipated generation shortfall of between 700 and 850 megawatts.
However, the board identified unresolved risks related to project execution, site selection, performance guarantees, fuel pricing and procurement practices.
Among its concerns, the oversight board stated that the proposal lacked sufficiently defined milestones for permitting, interconnection, fuel logistics, and construction necessary to meet a planned 90-day deployment schedule. It also questioned whether the selected San Juan site was optimal for the project, noting that the Costa Sur power station in Guayanilla appeared to offer logistical and regulatory advantages and was ultimately favored during discussions among PREPA, the Puerto Rico Energy Bureau and the 3PPO.
The board further cited the absence of finalized fuel supply arrangements, insufficiently defined performance bonds, and contractual provisions that could expose ratepayers to volatility in international liquefied natural gas prices. It also noted that only a portion of the proposed generation capacity had received preliminary interconnection review by LUMA Energy at the time of its assessment.
In addition, the oversight board expressed concerns about aspects of the procurement process itself, including deviations from certain bid bond requirements and questions over how final award decisions aligned with evaluation results. The board emphasized, however, that its review was limited to ensuring consistency with Puerto Rico’s fiscal plan and the promotion of market competition.
The letter specifically stated that the oversight board had not conducted independent due diligence or background investigations of the contracting parties, nor had it evaluated compliance with federal or local procurement laws, permitting requirements, or other regulatory obligations.
That distinction may prove significant as Gothams disputes testimony suggesting the company failed to meet environmental or regulatory requirements. While the oversight board documented concerns about project feasibility, contract safeguards, site suitability and procurement procedures, its findings did not conclude that Gothams had violated environmental laws, Coast Guard regulations or federal eligibility requirements.
Gothams argues that statements suggesting otherwise have damaged its commercial reputation and demanded that Carlo Linares cease repeating what the company characterizes as false claims. The company also requested that its cease-and-desist letter be included in the official record of the ongoing legislative investigation.
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