PREB issues resolution standardizing contribution in lieu of taxes in 78 towns

By THE STAR STAFF

The Puerto Rico Energy Bureau (PREB) has issued a new Resolution and Order aimed at standardizing how all 78 of the island’s municipalities apply Regulation 8818, the rule that governs the contribution in lieu of taxes (CELI), the mechanism through which towns receive electricity service in exchange for the tax revenue the Puerto Rico Electric Power Authority would otherwise owe.

The document responds to recent judicial and administrative rulings that revealed inconsistencies in how municipalities classify their facilities for CELI purposes. It also makes clear that the regulator’s criteria apply uniformly across the island. The PREB stresses that the measure does not amend Regulation 8818; rather, it ensures consistent compliance with its requirements.

Under the new directives, every municipality must conduct a full review of its properties, installations and municipal entities to determine which operate exclusively for nonprofit public purposes, which conduct for-profit activities, and which qualify as mixed-use facilities. The resolution reiterates the annual compliance calendar already embedded in the regulation: municipalities must submit all required classification information to grid operator LUMA Energy by Dec. 31 each year, or risk losing CELI coverage for those facilities in the following fiscal cycle. LUMA then has until March 31 to notify municipalities of the classifications and to submit its report to the PREB and the Office of Energy Public Policy (OEPPE). The PREB and OEPPE must, in turn, issue the maximum CELI allotment by April 15.

The PREB also addresses mixed-use facilities without separate meters, directing municipalities to pursue measurement segregation so that for-profit consumption can be billed separately. It reaffirms that all energy use attributable to for-profit activities remains excluded from CELI, including consumption recorded before segregation, consistent with the Court of Appeals’ recent ruling.