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LUMA seeks rate hike because of Ukraine invasion


LUMA Energy President & CEO Wayne Stensby

T&D system operator notes in filing that it does not benefit from increases in generation fuel costs


By The Star Staff


LUMA Energy announced Tuesday that it has filed the required quarterly fuel and purchased power cost adjustments with the Puerto Rico Energy Bureau (PREB) highlighting the significant effect of global events on the Puerto Rico Electric Power Authority’s (PREPA) generation fuel costs.


The calculated fuel and purchased power adjustments for a residential customer is approximately 4 cents per kilowatt-hour. Puerto Rico’s regulator, the PREB, will review and approve the final impact of any fuel and purchased power cost adjustments on customer rates. Nonetheless, LUMA Energy is seeking a hike in energy rates slated to go into effect in April.


As LUMA notes in its formal filing, the company does not generate energy, and does not set or profit from any increase in fuel prices – they are set by global markets that continue to be impacted by the global pandemic, disruptions to global production and, most recently, the Russian invasion of Ukraine.


LUMA’s responsibility, as detailed in the filing, is to calculate the quarterly fuel and purchased power adjustments. Fuel costs are provided by PREPA, whose responsibility it is to generate energy and purchase fuel required for generation from PREPA’s power plants, according to a company statement.


In the filing to the PREB, LUMA also made clear that LUMA has no control over how rising fuel prices may directly impact customer rates or bills – which are exclusively set by the PREB – nor does it financially benefit from any change or increase in generation fuel costs.


“Global events, including the pandemic, global supply disruptions and the recent invasion of Ukraine by Russia, are having a direct impact on the fuel costs used by PREPA to generate energy,” said Wayne Stensby, president and CEO of LUMA. “While we can’t control how these global events impact customer rates, we are determined to help and urge our customers to reach out to learn about a LUMA payment plan or the array of readily available financial assistance programs.”


As part of an effort to help its customers, the company is continuing a campaign across social media channels, including Twitter and Facebook, aimed at raising awareness of various government financial programs available to all eligible customers. In addition, LUMA will continue to promote its own payment plan options for customers who may have difficulty paying their energy bills, now or in the future. The company will be strongly encouraging customers to call 1-844-888-5862 or visit lumapr.com to learn what assistance programs could work best for customers facing concern over their bill.


“Given that PREPA’s cost of fuel and energy purchases from other generators currently make up more than 70% of our customers’ bills, we are greatly concerned by the continued negative impact that global events are having on fuel prices and customer rates, and we are determined to do all we can to help our customers,” Stensby said. “We are working together with key leaders across Puerto Rico to raise public awareness about several government assistance programs that could offer assistance to those eligible.”


Puerto Rico is heavily dependent on expensive diesel and bunker fuels to generate electricity. As fuel costs change based on the global marketplace, there is a formal regulatory process for adjusting customers’ rates accordingly. Puerto Rico customers’ electricity rates are adjusted on a quarterly basis to account for the changing cost of fuel used for power generation and other factors.

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