The government announced yesterday the GridMod Plan, a 10-year plan which contemplates a radical transformation of the power grid - devastated by Hurricane María - at a cost of $20.3 billion.
In a roundtable with reporters at La Fortaleza, Governor Wanda Vázquez Garced offered details of the plan and stressed that it was developed in coordination with federal and state government representatives and with the private sector. She also indicated that it seeks to strengthen the grid with the best practices in the industry and the most modern construction codes and standards.
The new grid would be mostly federally funded.
"We have worked on this strategy to have a power grid that responds to the needs of all Puerto Ricans. I know that there are many concerns in terms of what is happening in the day to day, in sectors where the power grid fails, but this plan presents a strategy and guidelines for several initiatives that will modernize the grid," said Vázquez Garced, who reiterated her rejection of the charge for energy efficiency approved by the Puerto Rico Energy Bureau.
Hours later, at 5:00 p.m., the president of the Puerto Rico Energy Bureau, Edison Avilés, said that in a 3-1 vote, the agency dismissed the charge, which would have increased the electricity bill as of Nov. 1.
According to Avilés, the Legislature was given space to approve amendments to Laws 57-2014 and 17-2019, "aimed at modifying the current public policy on energy efficiency, among them, the provisions related to the Bureau in that line," which allowed the approval of the rate adjustment.
"Although the Bureau is an entity with the autonomy to make its decisions, we also have the responsibility to listen to the people, as well as to address the concerns the governor presented to us," he said.
The charge represented an additional between $0.64 to $1.79 monthly, depending on consumption until June 30, 2020, with the goal to raise $13 million to develop energy efficiency programs.
At the roundtable, Vázquez was asked if she also opposes the increase attributed to the debt restructuring agreement between the Puerto Rico Electric Power Authority (PREPA) and its bondholders, to which she replied that she had no information on hand to give her opinion.
Meanwhile, PREPA executive director, José Ortiz, said that any impact on the electricity bill resulting from the agreement would be mitigated with projects such as the conversion to natural gas in San Juan units, the construction of a new plant in Palo Seco and the renegotiation of the contract with EcoEléctrica, among others.
Ottmar Chávez, executive director of the Central Office for Recovery, Reconstruction and Resilience (COR3), said they started developing GridMod Plan 18 months ago and added that this plan has three goals: to establish a client-centered grid, resilience, and sustainability.
"It will be a system designed around the customers´ needs, resilient enough to withstand any other (atmospheric) event that may come and in compliance with the most recent construction codes," he said and added that, for example, the grid would withstand winds of up to 175 miles per hour, instead of the current 145 mph.
Ortíz explained that the GridMod Plan "is aligned" with PREPA's Integrated Resource Plan (IRP), which contains the infrastructure works needed to meet the energy demands for the next 20 years. The IRP is under evaluation by the Puerto Rico Energy Bureau. "Any change to the Integrated Resources Plan will be incorporated into the Modernization Plan," he said.
Fermín Fontanés, executive director of the Public-Private Partnerships Authority, said that fact that the GridMod Plan is in line with the IRP "ensures" that it will not be affected by political changes.
Ortiz said that since the plan is customer-centered, the new grid will have "smart meters". This equipment will allow customers, for example, to receive information about their consumption and a projection of the bill.
"The cost is going to be another element to see who the client goes with, be it PREPA, the town cooperative or self-production. Customers will be able to select what is best for them, and that is flexibility," he said.
He said that the island will be divided into eight microgrids, which will operate independently and would be complemented by peaking units and businesses and industries that generate their own energy.
As for the other goal, resilience, Ortiz said that in addition to infrastructure resistant to hurricane winds, there will be underground power lines to ensure service to critical facilities. Chávez said priority will be given to the Medical Center, Luis Muñoz Marín Airport and the Northern Pharmaceutical Corridor.
Also, since Hurricane María destroyed 18 substations, the new ones will be gas-insulated. "They will be designed to operate for 40 years without maintenance," Ortiz said, noting that PREPA has 27 warehouses with six times the volume of equipment it had when Hurricane María struck the island.
In terms of sustainability, Ortiz said that, under Law 17-2019, PREPA becomes a component of the system, as it opens the door to establish cooperatives and consortiums and to produce their own energy.
Meanwhile, Chávez explained that of the $20.3 billion that the GridMod Plan costs, $14 billion are guaranteed through the Public Assistance Program and the Federal Emergency Management Agency's (FEMA) Section 404 Hazard Mitigation, as well as through the Community Development Block Grant for Disaster Recovery Program (CDBG-DR).
He said the remaining $6 billion would come from other federal and state funding sources or through public-private partnerships.
As for the execution of the plan, Fontanés indicated that he will be in charge of the private company the government will select for the operation of PREPA's transmission and distribution systems, a process that should be completed by the end of the year.
Meanwhile, Chávez specified that the implementation is divided into three phases. The "foundation" phase is the first one and it will take four years. This phase focuses on codes and standards, strengthening transmission, substations and distribution, repairs and strengthening critical infrastructure and communications, among other areas.
The second phase is "standardization" and it would take three years. It would focus on a "flexible" grid, decentralized generation supported by fuel infrastructure, integrating renewable sources and battery storage, direct energy conversion and selective undergrounding.
The third and final phase is "transformation" and would take another three years. During this period, the plan would focus in microgrids, customer systems and technologies, bi-directional power flow operations and network monitoring.
"This is a 10-year project and we have to do it the right way. We've worked with FEMA and others to get the resources so we don't run out of them halfway. This is essential to Puerto Rico, and the plan is tied to economic growth. This plan does not belong to this government, but to the people of Puerto Rico," the governor said.