Governor downplays expected hikes in utility rates
By The Star Staff
Gov. Pedro Pierluisi Urrutia on Thursday minimized the impact of proposed increases in the cost of water and electricity.
The governor stated that the water hike is 53 cents a month and that it will be executed by order of the Financial Oversight and Management Board and the fiscal plan of the Puerto Rico Aqueduct and Sewer Authority (PRASA).
On the other hand, he indicated that the increase in the cost of electricity that LUMA Energy has requested is not final and is subject to the approval of the Puerto Rico Energy Bureau (PREB). Pierlusi pointed out that in February of last year the kilowatt-hour cost of electricity was 28 cents and now it is 20.7 cents.
“Luma made that request, but PREB has the last word,” he said.
Pierluisi noted that PRASA has restructured its finances, improved its fiscal condition and has a huge capital investment plan. In addition, the water utility will install thousands of digital meters to better measure consumption.
Regarding the cost of electricity, the governor insisted that the PREB will have the last word.
“I don’t anticipate a hike and if there was a hike it would be very minimal, if any,” he said.
Pierluisi also said he considers it positive that U.S. District Judge Laura Taylor Swain has accepted the request made by the oversight board to postpone the confirmation process of the Puerto Rico Electric Power Authority (PREPA) debt adjustment plan (see related story on page 3).
“The information has been coming out, mainly as a result of the litigation, the bankruptcy process before the federal court,” he said. “For example, in that litigation process it was indicated that the [oversight] board is in the process of or about to update or revise PREPA’s fiscal plan. It was also indicated that the board received new income projections from [private power grid operator] LUMA, among other entities and, as has also been publicly indicated, we see that more and more consumers and entities are resorting to acquiring solar systems, solar panels with batteries, and that has an impact on PREPA’s income.”
The governor also pointed out, by insisting that any adjustment plan must be payable as long as the economy is not affected, that private sector entities and unions have raised the flag about the danger of the adjustment plan proposed by the oversight board and that it would raise the cost of electricity substantially. Meanwhile, more consumers are buying solar systems, which means less revenue for PREPA.
Pierluisi anticipated that the oversight board will amend PREPA’s fiscal plan taking into account the anticipated decline in revenue.