Thursday, December 10, 2020 • 5:43 pm
CyberNews
SAN JUAN – The president of the Association of Retirees of the Electric Power Authority (AJAEE), Johnny Rodríguez Ortiz, questioned on Thursday the reason why the government of Puerto Rico insists on maintaining the contract with LUMA Energy, and assured that LUMA is an entity without the financial or operational capacity to manage PREPA reconstruction, according to the Institute for Energy Economics and Financial Analysis (IEEFA).
“If they have not been able to demonstrate the ability to manage themselves, how is it possible that the government of Puerto Rico has handed over the important distribution and transmission assets of a service as essential as electricity on the island? This shows irresponsibility, and what has always been said, they are waiting for the cut from the Federal Emergency Management Agency (FEMA). The LUMA Energy company became the front line to receive federal funds, ”Rodríguez Ortiz denounced in a written communication.
In the Luma-AEE Contract Report, IEEFA summarized that rebuilding Puerto Rico’s network “costs more than $ 20 billion, largely financed with federal dollars. The two companies that sponsor LUMA – Quanta Services and ATCO – are worth around $ 12 billion. These companies are too small to face the challenge in Puerto Rico. If federal funding does not materialize on schedule or on schedule, these companies are poorly positioned to step in and get the job done. Also, the contract does not prohibit LUMA Energy from contracting with its parent company to realize some or all of the $ 18 billion in new federal spending projects that LUMA will manage.
“The electricity service of a town is essential for economic development. Now is precisely when Puerto Rico needs a safe, reliable and robust service. Something that LUMA and its parent companies cannot guarantee ”, expressed the president of AJAEE.
Rodríguez demanded that the agreement between LUMA Energy, the Puerto Rico Public-Private Partnerships Authority (P3) and the Puerto Rico Electric Power Authority (PREPA) for the operation of the transmission and distribution of the island’s electrical system ” it must be rescinded ”.
In the executive summary, it specifies that “the contract fails from the beginning, since in reality it is a complete privatization of PREPA’s core functions. The contract is signed with a private company that is not obliged to put its own money at risk. This is not an association; it is a contract that guarantees the flow of money to LUMA Energy and leaves a safe, reliable and affordable electricity system for Puerto Rico.
As if that were not enough, LUMA Energy recognized before the United States Securities and Exchange Commission, the entity that watches over the neatness of the stock market, that it has more expenses than income. “The reasoning is that PREPA hired a private company to help it get out of bankruptcy, but ironically it is a company facing liquidity problems. Instead of trying to get out of bankruptcy, what the government is trying to do is loosen the public monopoly to pass it on to a private monopoly that has shown that it has operational deficits ”, stressed the president of the AJAEE.
Rodríguez Ortiz affirmed that the AJAEE will continue to fight “for our pensions” and they will not lower their guard “in the face of the attempt to loot the federal funds allocated for the reconstruction of Puerto Rico’s electrical system.”
On the other hand, the president of the AJAEE, which brings together over 6,000 managerial and union retirees, questioned the “vote of silence” held by the Governing Board of PREPA and La Fortaleza on when they will settle the debt of 540 million dollars with PREPA’s Retirement System (SRAEE), an amount that PREPA itself recognized in the government’s transmission hearing.
