LUMA awards $75 million contract to parent firm subsidiary

By THE STAR STAFF

LUMA Energy, the private operator of the island’s electrical grid, has awarded a $75 million contract to Quanta Services Solutions PR LLC -- a subsidiary of one of its parent companies -- for the replacement and repair of Puerto Rico’s street lighting infrastructure, according to a recent document issued by the Financial Oversight and Management Board for Puerto Rico.

The contract, which stems from a competitive procurement process (3PPO-0328-08-DP) conducted by LUMA’s Third-Party Procurement Office, was approved by the oversight board with observations on Monday. It covers the installation, removal, and repair of street lighting components, including distribution poles and conductors, and is set to run for 36 months with the possibility of two one-year extensions.

The oversight board reminded LUMA that any extensions must be submitted for review and approval prior to execution, in accordance with its Contract Review Policy under the Puerto Rico Oversight, Management and Economic Stability Act, commonly known as PROMESA.

LUMA certified that the contract will be fully funded by federal sources. The selection of Quanta Services Solutions PR LLC -- which is linked to Quanta Services, one of LUMA’s parent companies -- raises questions about internal contracting practices, though the oversight board did not object to the award.

The contract was officially awarded on Feb. 26 of this year, and is part of ongoing efforts to modernize and stabilize Puerto Rico’s aging electrical infrastructure following years of damage from hurricanes and chronic underinvestment.