January 8, 2018 / 9:59 PM / in a month

Puerto Rico board may fast-track four power projects

NEW YORK (Reuters) - The U.S. federal board managing Puerto Rico’s finances will consider fast-tracking four energy projects that would invest a combined $1.47 billion in the island’s decimated power grid.

In a statement on Monday, the board said it was opening a 30-day public comment period on the four proposals, which include a controversial waste-to-energy incinerator plan by New York-based Energy Answers International Inc.

“In total, the four projects represent close to $1.5 billion in investment - almost all of which will be private capital - and have the potential to generate more than 8,200 direct, indirect and induced jobs,” the board said in statement, adding that final decisions would come by early April.

Hurricane Maria, which struck Puerto Rico on Sept. 20, left the local energy grid in shambles, and much of the island remains without power three-and-a-half months later.

The island’s power utility, known as PREPA, was already bankrupt when the storm hit, laden with some $9 billion in debt and outdated infrastructure.

Puerto Rico’s central government is also bankrupt, seeking a way to cut $120 billion in combined bond and pension debt. U.S. lawmakers in 2016 placed the island’s finances under the control of a federal board, whose authority includes expediting approval and permitting for infrastructure projects deemed critical, after fielding public comment.

Energy Answers’ proposed $860 million incinerator venture in rural Arecibo, which would produce energy from solid waste, has been opposed by environmentalists who claim it would emit pollutants such as lead.

Government sources say that the oversight board is influenced by former Governor Luis Fortuno, whose Washington, D.C.-based law firm, Steptoe & Johnson, counts Energy Answers as a client.

Fortuno advocated for the project in October, calling it “listo para arrancar” - loosely translated as “shovel-ready” - in an email to Puerto Rico government officials, obtained by Reuters.

Fortuno on Monday said he has had no contact with the oversight board on Energy Answers’ behalf.

“Steptoe has not been involved or been retained by Energy Answers in its dealings with the oversight board,” Fortuno said in an email to Reuters.

A call to Energy Answers was not returned on Monday. The oversight board had no immediate comment on Energy Answers or its relationship with Fortuno.

The other projects under consideration for expedited approval are:

- Parque Eolico del Norte, a $47.5 million, six-turbine wind energy project proposed by New Era Eolic LLC;

- A $538 million project to add 540 megawatts of dual fuel energy capability at seven PREPA locations, proposed by a group that includes a subsidiary of Mitsubishi; and

- A $25 million proposal to reduce energy and water consumption at certain Department of Corrections buildings, proposed by NORESCO

Noel Zamot, the board’s revitalization coordinator, said Hurricane Maria “demonstrated beyond any doubt Puerto Rico’s dire need to revamp” its grid.

Reporting by Nick Brown; Editing by Daniel Bases and Susan Thomas

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