Oil Report

Puerto Rico's biggest power plant could be offline for a year, executive warns

Jan 9 (Reuters) - Puerto Rico’s top energy executive on Thursday warned that the U.S territory’s largest power plant could remain off line for up to a year because of earthquake damage, evoking memories of lengthy power outages that followed a pair of hurricanes in 2017.

Two days after being hit by Puerto Rico’s most powerful earthquake in more than a century, only half of the Caribbean island had power restored, Jose Ortiz, the executive director of public power utility PREPA, told Puerto Rico’s WKAQ radio.

The Costa Sur plant near the quake’s epicenter was seriously damaged and could remain off line “perhaps up to one year,” Ortiz said, raising the prospect of bringing in temporary generators with aid from the U.S. Federal Emergency Management Agency.

A series of earthquakes including one of 6.4 magnitude early Tuesday rocked Puerto Rico. Periodic aftershocks continue to rattle the island of 3 million people, which has yet to fully recover from Hurricanes Maria and Irma. Those storms killed nearly 3,000 people.

At the same time Puerto Rico is going through a wrenching bankruptcy process to restructure about $120 billion of debt and pension obligations, and it was roiled by political instability in August when former Governor Ricardo Rossello resigned following massive street protests.

PREPA, also known by its Spanish acronym AEE, is in arrears on some $9 billion in debt, and now faces up to a year without energy from Costa Sur, which has a capacity of 990 megawatts.

“Costa Sur is a disaster,” Ortiz said. “There is structural damage and damage to equipment. Repairs could take months, perhaps up to one year. It’s really unsafe to be there right now. It’s life-threatening. Yesterday when we were inspecting it with the people from FEMA we had to leave when an aftershock started.”

Without Costa Sur, Puerto Rico would need the rest of its power plants to operate at or near peak capacity in order to meet demand.

Puerto Rico endured lengthy power outages following Hurricane Maria, exacerbating the humanitarian disaster.

Nearly a year passed before electricity generation approached pre-hurricane levels, according to a November report by the U.S. Energy Information Administration.

Puerto Rico also relied on temporary generators following the hurricanes. Ortiz said PREPA was looking for a company to supply them.

The quakes killed at least one person, destroyed or damaged about 300 homes, and led Governor Wanda Vazquez to declare a state of emergency. (Reporting Daniel Trotta; Editing by Scott Malone and David Gregorio)