• The Star Staff

Senate hopeful: NPP hiding electricity bill increase

By John McPhaul


Former San Juan District Sen. Ramón Luis Nieves charged Sunday that “the New Progressive Party (NPP) government has hidden from the people that they plan to impose on us several exorbitant increases in electricity beginning in 2021, after the November elections.”

Nieves, a former chairman of the Senate Energy Committee, said in a press release that “as UTIER [the main Puerto Rico Electric Power Authority union] has rightly denounced, the privatization contract for the Puerto Rico Electric Power Authority (PREPA) indicates that, after the elections, LUMA will make a request to the Energy Bureau that the electricity be increased to cover the $100 million annually that they will charge to operate PREPA.”

Meanwhile, in the dark of the night, Nieves said, the Financial Oversight and Management Board approved PREPA’s Fiscal Plan submitted by the NPP government. On page 41 of the plan, the government reveals that electricity rates will rise to 27 and 30 cents per kilowatt-hour (kWh) between 2021 and 2025, he said.

“Today, for example, the price per kilowatt-hour that we are paying is 17 cents and each penny of increase in the price per kilowatt-hour is equivalent to $170 million that comes out of our pockets,” said Nieves, who is seeking to become a Popular Democratic Party candidate for Senate-at-large. “A big hit to our economy of over $1.7 billion. These increases in electricity rates will prevent our economy from recovering, and represent a terrible burden for our homes, as well as for industries and our small and midsize businesses.”

“I am also concerned that the signing of the contract with LUMA is being used as an element of pressure to force the approval of the disastrous agreement with PREPA’s bondholders,” Nieves added. “That agreement will condemn us to pay dearly for decades -- to pay old debt -- which will destroy our economy forever.”

Nieves also criticized LUMA’s contract to operate PREPA’s transmission and distribution system because, he said, it suffers from “serious defects that threaten the people of Puerto Rico.” Among those defects, the Senate hopeful noted:

• Contrary to the provisions of Law 120-2018, the contract puts at risk the jobs and benefits of PREPA employees

• The transaction does not contribute a single penny to the PREPA employee retirement plan, which has a multi-million dollar deficit (contrary to Law 120-2018)

• The contract replaces the public monopoly with a private monopoly

• The contract does not indicated what the impact will beon electricity rates, including LUMA’s charges for operating PREPA

• It is anticipated that LUMA will request an increase in the electricity rate from the Energy Bureau that will apply in 2021, after the elections

• LUMA will NOT contribute a single penny to rebuild the electrical system, only managing allocations of federal money ($2 billion so far)

• The contract authorizes LUMA to subcontract to other companies to carry out its work

• Since PREPA will not disappear, it is unclear whether it will continue to hire consultants and lobbyists at multi-million dollar rates, as in the present

• The contract does not contain prohibitions for LUMA, its executives and employees, on making donations to Puerto Rico politicians.

“Contrary to the total absence of oversight of PREPA by the Senate chaired by Thomas Rivera Schatz until December, I am prepared to inspect -- as senator at-large -- PREPA and LUMA, and thus defend the people of Puerto Rico, and our economic development,” Nieves said.

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