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Puerto Rico calls on U.S. utilities to help restore power
October 31, 2017 / 5:19 PM / 22 days ago

Puerto Rico calls on U.S. utilities to help restore power

(Reuters) - It took almost six weeks, but Puerto Rico has finally called on U.S. mainland utilities to help restore power after Hurricane Maria knocked out electric service to all of the U.S. territory’s 3.4 million residents.

Chairman of the Federal Fiscal Control Board Jose Carrion (R) and members of the board (L-R) Andrew Biggs, Carlos Garcia, Arthur Gonzalez and Jose Gonzalez attend a meeting of the Financial Oversight and Management Board for Puerto Rico in San Juan, Puerto Rico October 31, 2017. REUTERS/ Alvin Baez

Puerto Rico Electric Power Authority (PREPA) Executive Director Ricardo Ramos sent a letter on Tuesday to utility industry trade groups requesting assistance from U.S. mainland utilities, they said.

Restoration of power on the island will now shift toward other utilities and the U.S. Army Corps of Engineers after the Puerto Rican government removed a small Montana contractor.

Puerto Rico canceled a $300 million contract between PREPA and Whitefish Energy Holdings, which had been rebuilding the island’s power system since early October.

The Army Corps said it planned to boost the size of a contract awarded to engineering firm Fluor Corp by $600 million, to $840 million, according to a government filing.

PREPA, which declared bankruptcy in July, has said it relied on contractors like Whitefish and the Army Corps due in part to its financial difficulties and the logistical complexity of bringing crews and equipment to the island.

Officials at PREPA could not be reached for comment.

”Utility companies were hesitant to engage, because there was no guarantee of cost share payment,” the Army Corps’ Major General Donald Jackson told the U.S. Senate Committee on Homeland Security and Governmental Affairs.

He said the Corps had about 150 contractors on the ground as of Tuesday, working with 450 Army Corps personnel. Another 500 would arrive by the end of the week, with about 1,000 workers in place by mid-November.

Power has been restored to only about 30 percent of the island’s 1.5 million homes and businesses since Maria hit on Sept. 20. Jackson said the Army Corps hopes to restore half of the island’s electric system by the end of November.

MAINLAND MUTUAL ASSISTANCE

Mainland utilities rely on mutual assistance from other power companies to help restore service.

Christian Sobrino, (R) Puerto Rico's government liaison to the territory's federal oversight board and David Skeel, member of the board, attend a meeting of the Financial Oversight and Management Board for Puerto Rico at the College of Engineers and Land Surveyors in San Juan, Puerto Rico October 31, 2017. REUTERS/Alvin Baez

Florida Power & Light (FPL), a unit of Florida power company NextEra Energy Inc, called on utilities across the country days before Hurricane Irma hit and was able to restore power to more than 3.6 million customers in just 10 days.

But PREPA is not FPL. It has $9 billion in debt caused by years of unsuccessful rate collection, particularly from municipal governments and state agencies, and has not invested in equipment and maintenance.

“PREPA didn’t have a real good handle or understanding of what they had,” Jackson told the Senate hearing. Crews had to visit each warehouse to count poles, wire spools and transformers.

Moreover, Puerto Rico is an island located over 1,000 miles (1,600 kilometers) from Florida, so mainland crews have to fly in and send their equipment by ship. They also have to eat and sleep somewhere, and that is difficult since the hurricane damaged much of the island’s housing.

Slideshow (5 Images)

PREPA ASKS FOR HELP

PREPA sent the mutual aid request to the American Public Power Association, a public power industry group, and the Edison Electric Institute, a group for investor-owned utilities.

“We are already working with our member companies to mobilize crews, equipment and technical experts,” EEI President Tom Kuhn said in a statement with APPA.

PREPA’s formal request for assistance followed calls for help by Puerto Rico Governor Ricardo Rossello to New York and Florida, which already have some utility crews on the island.

New York power company Consolidated Edison Inc said it was assembling several hundred employees and contractors.

WHITEFISH CONTRACT

U.S. Federal Emergency Management Agency Administrator Brock Long told the Senate committee that FEMA was not notified until “several weeks after the fact” that PREPA had contracted with Whitefish.

“There’s no lawyer inside FEMA that would have ever agreed to that language that was in that contract to begin with,” he said.

Reporting by Scott DiSavino, Nick Brown and Jessica Resnick-Ault in New York and Roberta Rampton in Washington; Editing by Andrew Hay and Dan Grebler

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