PREPA now headless in the middle of hurricane season
By The Star Staff
The Puerto Rico Electric Power Authority (PREPA) governing board on Monday accepted the resignation of the public corporation’s executive director, José Ortiz Vázquez, effective on Wednesday.
“We have accepted the resignation of Ortiz with appreciation for the job he has done,” said Ralph Kreil, chairman of PREPA’s governing board. “When Ortiz took over, PREPA had not even completed an integrated resource plan [IRP], and we were struggling to develop a working relationship with regulators, like the Puerto Rico Energy Bureau [PREB] and the Financial Oversight and Management Board for Puerto Rico.”
Ortiz said that when he was originally asked to become PREPA’s executive director, he committed to two years of service and 24 months have already passed.
“My resignation comes at an appropriate moment in the transformation of PREPA into the modern electric utility all Puerto Ricans deserve,” Ortiz said. “Throughout these two years PREPA has committed itself to focusing on the reliability, sustainability, affordability and economic development envisioned in Law 17 of 2018.”
The executive director’s resignation comes amid criticism as thousands were left without power following the passage of a tropical storm last week. For many the incident was proof that the energy system is not ready for a major storm. Ortiz blamed the power outage on internal terrorism but was unable to support his claims.
Gov. Wanda Vázquez Garced said at a press conference Monday that she met with Kreil over the weekend and had expressed her concern about PREPA’s response after the storm.
“We asked the [governing] board to review that response, not just from the CEO, but from all top management,” the governor said. “We are starting the peak of the hurricane season and I need an accurate and efficient response for all Puerto Ricans, so, yes, the engineer resigned. I know that the Board was consulted and so it was determined.”
Ángel Figueroa Jaramillo, president of the Electrical Industry and Irrigation Workers Union, which represents PREPA workers, said Ortiz’s resignation should not be a cause to celebrate or be happy.
“What the resignation of an executive director who was incapable, incompetent and a liar offers is to rethink the kind of PREPA that we want and its transformation under a public model,” Figueroa Jaramillo said.
He said Ortiz’s decisions have to be re-evaluated because he left “multi-million dollar contracts” all signed up, including contracts to cut grass and trees near power lines, which he said “were the cause of Tuesday’s power outage.”
Figueroa Jaramillo urged the government to find a new executive director who is willing to put the public interest ahead of his.
Kreil disagreed. After Ortiz took over the struggling utility, PREPA has had three fiscal plans approved by the oversight board and PREB is nearing the conclusion of its hearings on the IRP.
“Working hand in hand with Ortiz, we developed a strong working relationship in Washington, D.C., achieving credibility with the federal government,” Kreil said. “Among other accomplishments, PREPA created the Project Management Office, which has been critical in getting Costa Sur 5 back on-line, has kicked off the LUMA Concessionary Contract for better transmission and distribution service to our ratepayers, and has renegotiated the EcoEléctrica contract to improve reliability and reduce costs to consumers.”
“Also, Ortiz’s vision helped to bring the conversion of San Juan units 5 and 6 to natural gas and resolved long-standing renewable energy projects, moving most of the active projects a big step forward in becoming a reality for Puerto Ricans, while also implementing a more transparent procurement discipline at PREPA,” Kreil added.
Although sometimes Ortiz and the governing board may have had different points of view, Kreil said they were always able to find a way to work together positively in the best interest of ratepayers.
The PREPA governing board’s consumer representative, Tomás Torres, said the embattled utility’s transformation goes beyond the resignation of Ortiz.
He said it needs the approval of a debt restructuring agreement that does not entail high energy rates, an integrated resource plan that takes the utility away from the use of fossil fuels, the completion of repairs to Units 5 and 6 of the Costa Sur power plant and the allocation of federal funds. He also was critical of the lack of transparency that led to the contract with LUMA Energy, the private operator of PREPA’s transmission and distribution.
“The transformation of PREPA requires firm and forceful actions in favor of the consumer to develop a reliable and resilient electrical system in accordance with the New Energy Policy of Puerto Rico, Law 17 of 2019,” Torres said.
LUMA Energy, which took over the management of PREPA’s transmission and distribution system in June, said in a statement it will be working closely with PREPA and will continue to work together with the new leadership, PREPA’s governing board, and the Public-Private Partnership Authority to stay focused on the goal of transforming the electricity delivery system for the people of Puerto Rico.
“LUMA brings proven skill and experience in building safe, reliable and sustainable electrical infrastructure, skilled workforce training, world-class utility operations, and customer service, as well as our deep knowledge of how federal disaster funds must be managed with efficiency, transparency and integrity,” the company said. “This current transition phase is expected to last until May 2021. During this phase, our team is working to assess and put together a detailed plan to transform the electricity transmission & distribution system in order to improve its overall sustainability, reliability and resiliency.”
Environmental groups also expressed happiness over the departure of Ortiz because they said it will help advance the transformation to renewables.