La Fortaleza rejects LUMA rate hike, demands transparency on executive salaries
LUMA says proposed increase reflects higher generation costs, not company revenue
By THE STAR STAFF
Jean Peña Payano, La Fortaleza’s secretary of public affairs, rejected a proposed electricity bill increase from LUMA Energy on Thursday and demanded that the company disclose the salaries and other benefits received by its executives.
“Naturally, we do not want energy costs to rise,” Peña Payano said at a press conference.
The official was responding to a proposal submitted by the grid operator to the Puerto Rico Energy Bureau (PREB) which, he noted, could result in an additional monthly charge of nearly $48 for some customers.
Peña Payano described it as “cynical” for LUMA to propose a rate hike while maintaining expenses that, in his view, should be disclosed in greater detail.
“Let them be truly transparent and publish their executives’ salaries,” he said.
The secretary also demanded information regarding other benefits received by company officials.
“Let them say how much the executives earn -- regardless of which company they are from,” he said. “Let them say, ‘Look, we are going to disclose how much they earn, which schools our children attend, how much we are paying for each child’s schooling, which private gated communities we are moving into, and what the housing and relocation costs are.’ Let them publish this and be transparent.”
Peña Payano noted that it is up to the PREB to evaluate any request for a rate increase submitted by LUMA.
“Remember, it is not La Fortaleza; it is the Bureau that evaluates these kinds of things,” he said.
The official contrasted the potential rate hike with the government’s discussions on providing relief to retirees who receive pensions of less than $1,000 per month.
“In fact, they now want to add another $48 in LUMA charges to those very retirees who are living -- or trying to live -- on $33 a day,” he remarked.
Peña Payano also reiterated the executive branch’s opposition to the private operator and linked the matter to the dispute over LUMA’s continued role in the electrical system.
“We already know which side we are on, and we are not going to be on LUMA’s side,” he stated.
LUMA on Thursday defended the rate increase it had proposed a day earlier, arguing that the adjustment now before the PREB is strictly meant to cover higher‑than‑expected generation costs from July through September and does not translate into additional income for the private operator of the island’s electric power transmission and distribution system.
The company said the island’s power producers spent more than projected on fuel and purchased power during the summer quarter, triggering a reconciliation process that could add 6.07 cents per kilowatt‑hour to customer bills if approved. For an average residential customer, the change could mean roughly the aforementioned $48 more per month, driven largely by higher electricity consumption during extreme heat, global oil price spikes tied to conflict in the Middle East, increased use of customer battery systems, and reliance on more expensive fuels when generation units underperformed.
“We understand the impact this could have on our customers, especially older adults on fixed incomes,” said Janisse Quiñones, LUMA’s executive director. “We don’t simply explain the situation -- we continue insisting that Puerto Rico needs reliable, stable generation. That is the only way to achieve real, lasting relief in energy costs. At no point do these bill adjustments represent profits for LUMA.”
If authorized by the PREB upon review, the increase would take effect in October. Regulators emphasized that the adjustment is not permanent and could decrease in future quarters if fuel prices fall.
Under Puerto Rico’s rate rules, fuel and purchased power costs are reconciled every three months, similar to comparing a household’s estimated gasoline budget with actual spending. Any excess cost must be recovered, and in the case of electricity, that difference is reflected in the rate approved by the PREB.
LUMA, which manages transmission, distribution and billing, stressed that it does not buy fuel, set fuel prices or determine global petroleum costs. Those figures are provided by the island’s generation companies -- including Genera PR -- and incorporated into formulas established by the government. LUMA’s role, the company said, is limited to calculating the variance between projected and actual costs and submitting the data transparently to regulators.
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