UTIER files complaint to overturn PREPA-LUMA deal
By The Star Staff
The Electrical Industry and Irrigation Workers Union (UTIER by its Spanish acronym) filed a complaint Thursday in the commonwealth’s Court of Appeals seeking to overturn an energy regulator’s decision granting a certificate of compliance to the contract between the Puerto Rico Electric Power Authority (PREPA) and LUMA Energy to manage the utility’s transmission and distribution (T&D) system.
UTIER’s attorney, Rolando Emmanuelli, said the union is challenging the Puerto Rico Energy Bureau’s (PREB) decision to grant the certificate on several fronts. One is the lack of public participation from stakeholders in the decision, while another relates to the ethical conduct of PREB chairman Edison Avilés.
Avilés was part of the government commission that selected LUMA Energy, but he also participated in the PREB process that granted the certificate of compliance, in what UTIER contends was a conflict of interest.
On June 22, PREPA entered into a 15-year agreement in which LUMA Energy will manage the utility’s T&D for a service fee and incentive fees payable to the company after achieving certain performance milestones. The fixed fee starts at $70 million for the first year and increases to $105 million for years four through 15, but with the incentives the total would end up costing $125 million per year. The contract requires the reorganization of PREPA into two operating companies. One is GridCo, which will retain ownership of the T&D system, and the other is GenCo, which will own PREPA’s generation assets.
UTIER President Ángel Figueroa Jaramillo said in a statement that prior to PREB’s decision, issued on June 17, both the contract and a report prepared by the Public Private Partnership Authority, which negotiated the agreement, had been kept secret. Although the report exceeded 600 pages, the LUMA Energy contract was approved by PREPA, the P3, the Financial Oversight and Management Board for Puerto Rico and island governor Wanda Vázquez Garced, without citizen participation.
“The efficiency shown by the government when it comes to depriving the people of their rights is incredible, in contrast to the ineptitude it shows in protecting them. We will carry out the battle against this contract in all forums, to protect the interests of our members and the people of Puerto Rico to prevent them from stealing from us and increasing our rates,” Figueroa Jaramillo said. “We have no doubt that the only one who benefits from this contract is LUMA Energy. They are going to profit from doing the same work that the Authority can do without investing a penny. There is no benefit for consumers, workers or for Puerto Rico.”