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November 30, 2022

Puerto Rico Groups and Earthjustice Declaration on LUMA's Controversial Contract Extension

While the validity of the contract extension is being contested, the result of it is clear: it allows LUMA to continue operating despite its poor performance and overpriced service

Contacts

Robert Valencia, Public Affairs and Communications Strategist for Latino Outreach and Engagement, rvalencia@earthjustice.org

Washington, D.C. and San Juan, Puerto Rico

On Tuesday, Puerto Rico officials voted to extend the contract of the problem-plagued LUMA Energy, despite the company's failure to deliver reliable electricity across the archipelago. In the nearly two years since LUMA Energy took over management of the electricity grid, ratepayers have seen skyrocketing costs while outages have increased significantly. Instead of prioritizing a shift to distributed clean energy, the Financial Oversight and Management Board voted to double down on continued reliance on fossil fuels and vulnerable transmission lines, with LUMA profiting. No means have been established to hold the company accountable for delivering reliable service.

While the validity of the contract extension is being contested, the result of it is clear: it allows LUMA to continue operating despite its poor performance and overpriced service. After the decision, Earthjustice and Puerto Rico-based groups issued the following statement:

“Rooftop solar and storage are instrumental to combatting climate change while helping Puerto Rican communities weather disasters more effectively,” said Ruth Santiago, environmental advocate and Earthjustice board member. “Local authorities must face the fact that a distributed, renewable energy revolution is here to stay.”

“The decision to extend the supplementary contract leaves Puerto Rico even more vulnerable by allowing LUMA to continue effectively controlling the electrical system with no end date to the contract, paying more and without real performance measurements or a current penalty system. As if that were not enough, the extension process was manipulated to leave its consideration to the 11th hour, with few opportunities for analysis and reform,” said Pedro Saade, Puerto Rico attorney and professor at the University of Puerto Rico Environmental Law Clinic.

“Governor Pierluisi has stated that the cancellation of LUMA's contract would harm the people of Puerto Rico, because LUMA would not be incentivized to perform well during the transition period. Governor Pierluisi fails to mention that LUMA is already operating without performance metrics, and without the incentives to give the people of Puerto Rico the service they deserve and need. Rooftop solar and battery storage could provide this much-needed service, so the government should penalize for poor performance, any delays or unnecessary costs to the interconnection process for these systems,” said Lorena Vélez Miranda, Puerto Rico-based attorney at Earthjustice.

About Earthjustice

Earthjustice is the premier nonprofit environmental law organization. We wield the power of law and the strength of partnership to protect people’s health, to preserve magnificent places and wildlife, to advance clean energy, and to combat climate change. We are here because the earth needs a good lawyer.