Green energy producers: Solar projects too vital not to get a fair review from fiscal board

By John McPhaul

The Renewable Energy Producers Association (APER by its Spanish acronym) continues to promote the use of renewable energy for Puerto Rico, saying that it is indispensable for the future of the island.

“The benefits of this clean energy bring with it the reduction of costs and environmental impact, as well as injecting private investment and creating jobs, which means a positive impact on the economic development of the country,” said APER Executive Director Julián Herencia.

Diversification of energy sources is a global movement that maximizes renewable generation while reducing dependence on fossil fuels. Puerto Rico’s public energy policy imposed a clear mandate to transform the majority of generation to renewable sources in a short time, while integrating more efficient generators into the portfolio. The fulfillment of this mandate will allow Puerto Rico to finally move toward sustainability and competitiveness, renewable energy proponents say.

“The first logical step to reach that goal is the mobilization of the 16 solar energy projects that the [Puerto Rico] Electric Power Authority [PREPA], its governing board and the Puerto Rico Energy Bureau [PREB] approved as recently as in August of the current year,” Herencia said. “The proponents of these projects have invested considerable resources in Puerto Rico, trusting that the island’s contractual responsibilities and public policy will be respected.”

He added that “despite the good offices of PREPA and PREB, these projects were left in the air by the Financial Oversight and Management Board [FOMB] through undue interference in the implementation of public energy policy.”

“Add to this that the [oversight] Board used faulty reasoning, by including incomplete and erroneous information,” Herencia said. “For example, the Board bases its determination on an analysis of an obsolete fiscal plan, which includes projects that are not going to be carried out and inputs that are not those dictated by the market.”

“The FOMB’s intervention did not go unnoticed. As recently as Nov. 30, 2020, Congressman Raúl Grijalva (D-Ariz.), chairman of the Natural Resources Committee of the federal House of Representatives, asked the FOMB for explanations about its determination to stop PREPA’s agreements with the 16 renewable energy producers,” APER said in a press release. “His voice joins that of many who do not understand this ill-advised decision and who intervene directly with matters of public policy. The [oversight] Board is hindering the progress and economic development of Puerto Rico, as the world continues its path toward renewable energy.”

APER has tried to collaborate with the oversight board to analyze and validate the data, make tempered models for Puerto Rico, and compare the overwhelming evidence from local, national and international markets.

“This [is offered] as collaboration, not an imposition,” APER said. “APER maintains that an objective analysis with correct and updated information will reveal that the 16 renewable energy projects fully comply with public policy and PREPA’s fiscal parameters.”

Unfortunately, APER’s requests have received a slight response from the oversight board that has been limited to a “let’s see,” without anything concrete, the producers’ group said.

APER has effectively collaborated with PREPA, the PREPA governing board, and the PREB, entities that have experts in the field and that approved the projects knowing the positive impact they would bring to Puerto Rico’s economy, the association said. The projects contemplate a private capital investment of over $1.1 billion, the creation of more than 8,900 total new jobs, the reduction in PREPA fees and about $130 million that will not leave the island for the purchase of fossil fuels.

Herencia emphasized that “the 16 projects were adjusted to the current needs of Puerto Rico, including a substantial reduction in the agreed energy price.”

“In Puerto Rico there are few opportunities where a large group of suppliers competitively lower their prices to support the market,” he said. “Above all, in a place where everything seems to increase [in price]. There are also few opportunities where an industry is willing to provide 100 percent private investment and create a substantial number of jobs in as little as 12 to 18 months. These projects are ready to mobilize and begin construction with this speed.”

“APER’s position is that these projects should be mobilized, in parallel with any other request-for-proposal process for additional capacity and distributed generation initiatives,” the association’s executive director said. “In an orderly manner, resources would be maximized and greater integration can be achieved. There are several steps toward energy diversification. But it is logical that the first is a forceful one and that it achieves material results for the island. It is time for action, to achieve big victories for our people.”

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