PREPA board chairman: No fiscal rescue plan for AES
By The Star Staff
Puerto Rico Electric Power Authority (PREPA) Governing Board Chairman Fernando Gil Enseñat insisted Tuesday that the utility is not providing financial rescue to Applied Energy Systems (AES), which has a coal-burning plant in Guayama that must transition to the use of renewable energy sources by 2027.
Gil Enseñat spoke at a public hearing held by the House Economic Development Committee chaired by Popular Democratic Party Rep. Luis Raúl Torres Cruz to discuss House Resolution 243, which calls for a probe into the island’s economic and energy priorities.
Gil Enseñat said the ‘’Authority is not and has not been in the process of any negotiation with AES.”
“There is no economic or environmental rescue,” he said.
Currently, AES generates 454 megawatts of generation that is used to meet the island’s daily energy demand and represents between 15 and 20 percent of the installed capacity. PREPA signed the Power Purchase and Operation Agreement 1995-A10077 (PPOA) and in 1994 made a commitment to maintain the contract for a period of 25 years in which the government agency would pay for energy purchase and a capacity charge.
Gil Enseñat noted that AES has until 2027 to make the transition from the total elimination of coal use to generating energy and starting the production of natural gas. The public official could not specify what actions PREPA would take to force the company to comply with the transition process and the contract.
Likewise, the PREPA board chairman added that if the plant in Guayama is eliminated, it would represent a problem in the rest of the authority’s systems.
“We understand that the situation would become very complicated for us if that plant is eliminated due to the rigorous maintenance that has been given to it and due to the production of the amount of energy that is currently being carried out,” he said.
Regarding whether the communities surrounding the coal plant have been damaged, Gil Enseñat stated that “we know of the claims by the people regarding the burning of coal.”
“However, I have no record of environmental damage,” he said.
Meanwhile, José Coss Charriez of the Sierra Club charged that AES has been “pushing hard” to acquire a million-dollar contract with the government of Puerto Rico to remain only as an “operator” of the Guayama plant.
‘’It seems that AES wants the government to pay millions of dollars for all the health damage it has caused, under the threat of shutting down the plant and stopping energy production,” he said.
Coss Charriez said that a few weeks ago PREPA Executive Director Josué Colon revealed that, since Jan. 15, half of the AES coal plant has been disconnected from the electrical system for maintenance and that the plants of the public corporation can generate the amount of energy produced by the AES facility.
He emphasized his concern over the exposure to toxic ash suffered by Guayama residents. According to media reports, the coal plant released more than 1.5 million pounds of toxic substances in 2019. The Puerto Rico Cancer Center Registry maintains that Guayama remained among the 10 municipalities with the highest incidence of cancer between 2004 and 2014.
According to the Sierra Club, AES is insisting that the island government assume its expenses, including the purchase of coal and more than $150 million in environmental costs.
“Given this situation, the discussion should not revolve around whether the government should rescue the company, but what the necessary steps are to close the plant,” Coss Charriez said.
The Sierra Club representative requested a response from the company regarding the environmental and health damage to the surrounding communities caused by AES through its operations in Guayama. Coss Charriez also recommended that the committee make viable the proposal of the environmental group Queremos Sol to create a transition to the island’s electrical system.
“We propose the installation of solar panels on the roofs of homes as a public service, with which we could achieve 75 percent renewable energy in 15 years and reduce fuel costs to $430 million when current costs exceeded $1.4 billion in 2019 and 2020,” he said.