NEW YORK – Despite the mobilization in the streets of Puerto Rico by some groups and the pressure from members of the diaspora in the United States not to extend the supplementary contract, LUMA Energy, a foreign consortium in charge of of the transmission and distribution of electric power on the island, will continue to operate at least until the debt restructuring process of the Electric Power Authority (PREPA) is completed.
This Wednesday, the governor of Puerto Rico, Pedro Pierluisi, a regular defender of the company, confirmed in a press conference that LUMA will continue to have control of PREPA.
Pierluisi, who insisted that the cancellation of the contract would be “disastrous” for the island, he acknowledged that after the renewal, the Canadian consortium will be paid more for its services due, among other things, to the costs of inflation. The payment to LUMA would be around $121 million, as estimated by Pierluisi, also president of the ruling New Progressive Party (PNP).
“Right now under the supplemental agreement, LUMA collected in this year, which just passed, about $115 millions. For next year, there is an adjustment that is already provided in the contract itself, based on inflation costs, among other things, which then increases the amount to around $251 million”, stated the president.
According to the report by El Vocero , a media outlet in Puerto Rico that first reported on the extension of the agreement, the extended contract does not have a specific expiration date.
A letter from the Fiscal Control Board, a federal body that manages the finances of the island since 2018, mentions that the figure assigned for LUMA in the year tax 7000 is $500.7 million. The amount may be spent from the effective date of the proposed amendment, that is, Thursday, December 1.
According to the Governor, the process to restructure the Authority’s debt may result in the federal court confirming the Plan Adjustment of the Debt (PAD) for those purposes or that Judge Laura Taylor Swain dismisses the petition.
“If the court confirms a PAD for the Authority then all the provisions of the contract will enter into force of 15 years between the Public Private Alliances (APP), PREPA and LUMA, which was signed in mid-2020. At that time, the amount will be changed to the company and a system of bonuses or penalties will be established based on their performance”, explained the chief executive.
In the last few hours, while the vote was finalizing of the Board of Directors of the PPP Authority to authorize the extension, groups like “No more promises”, protested near La Fortaleza, Pierluisi’s official residence in San Juan, under the slogan “Let’s break the contract”.
The group, one of the most active in Puerto Rico against the LUMA contract, considers that the entry of the company has exacerbated the energy crisis on the island, where blackouts are the order of the day as well as increases in the electricity bill.
“The Fiscal Control Board, the Energy Bureau, the colonial government of Puerto Rico together with the United States are complicit in the acute energy crisis and its impacts on the health and lives of the people, especially those who nes survive in precariousness due to decades of failed policies and corruption. We call on the people to keep the fight in the streets, which are public spaces and spaces for expression where we will continue to denounce abuses. We demand the recovery to public hands of the electric power service, the cancellation of the contract and the restitution of the employees unfairly displaced by the privatizing company LUMA. Fight yes, surrender no! This town respects itself! #SeAcabaronLasPromesas”, read a message this morning on the collective’s Facebook account.
The process to authorize the extension of the contract was not without controversy.
Eduardo Ferrer Ríos and Liza Ortiz Camacho, the representatives of the public interest before the Board of Directors of the PPPs, rejected the process in which the extension was approved by a simple minority.
“They passed over the interests of the people of Puerto Rico,” said Ferrer Ríos.
The representatives of the public interest abstained from voting, while the other three members, the Secretary of State, Omar Marrero; the Secretary of the Treasury, Francisco Parés, and the President of the Planning Board, Julio Lassús, favored the agreement.
In the opinion of the dissidents, abstention would mean votes against.
“We could not validate a vote contrary to law … under the Law 75 abstention is understood as a vote against the amendment of the supplementary contract”, Ortiz Camacho stated in a virtual press conference.
The duo stated that the Law 120-2018 establishes that any transaction related to the Electric Power Authority must have the affirmative vote of the representatives of the public interest.
Ortiz Camacho and Ferrer Ríos also thundered against the Board of Fiscal Control for having approved the process before the PPP vote.
Lo The members anticipated that they will go to court to request that the vote be annulled.
For his part, Marrero rejected the claims of the complainants on the grounds that the discussion was extensive and in accordance with the law.
“We confirm that they followed procedures and meetings in a manner consistent with what has been our practice in the past. Wanting to say otherwise is lying to Puerto Rico. The members had all the necessary information and that it was requested to consider the matter in question,” the Government representative indicated in writing to El Vocero.
From the diaspora and prior to the confirmation of the extension of the contract, the former president of the New York City Council, Melissa Mark-Viverito, indicated that the temporary extension could be an opportunity to advance in the fight against the energy company from different areas.
“We are listening to the cry They have every justification for being frustrated and we are going to fight with them (with the Puerto Ricans) to try to put pressure on the governor because this contract cannot continue. There is a lot of suffering in Puerto Rico. My mom who has 27 years, I always think of her, that like any other Puerto Rican suffers these blackouts, what these blackouts mean in the quality of life. What has to do with health, what hospitals suffer, disabled people. It is not acceptable”, he raised about the deficiencies attributed to LUMA since June of last year when the clauses of the contract were activated by 24 months.
Mark Viverito, who was part of a delegation of New York political leaders and activists who called for the cancellation of the contract to LUMA in the framework of the celebration of the SOMOS conference in Puerto Rico in November, cataloged the management of LUMA for the past months as “unacceptable”.
“Now we must analyze the legal aspect , what options do we legally have or what options does Puerto Rico have legally to take LUMA and this contract to Court. But also follow us in the diaspora getting support. The New York City Council has already presented a resolution asking that this contract not be signed and that it be cancelled”, highlighted the former candidate for the NY Ombudsman’s Office in an interview with the Válgame PR podcast.
For its part, the non-governmental organization “Queremos sol” that proposes an energy transformation for Puerto Rico based on renewable energy, stated in its networks that the Government of Puerto Rico must stop insisting on extending a lousy and expensive service.