Luis Aníbal Avilés Professor, University of Puerto Rico Law School.

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Presentation transcript:

Luis Aníbal Avilés Professor, University of Puerto Rico Law School

Puerto Rico’s Electric Energy Public Policy in Phases Phase 1: Private un-centralized production of power (1893-1941) Phase 2: Nationalization of Private Electric Systems (1941-1989) Law 41-1941 Puerto Rico Electric Power Authority (PREPA) Organic Act Phase 3: Public Utilities Regulatory Policies Act (PURPA) (1990-2000) Independent Power Producers EcoEléctrica (Natural Gas) and AES (Coal) Puerto Rico Energy Public Policy –Executive Order 1993-57 Phase 4: New “Mandate” to PREPA (2007-Present)

New “Mandate” spearheaded by the Energy Policy Act of 2005 Act 114-2007 Puerto Rico Electric Power Authority Net Metering Act Act 73-2008 Mandates (Retail?) Wheeling as part of the Economic Incentive for Economic Development reauthorization Act Act 82-2010 Public Policy on Energy Diversification by Means of Sustainable and Alternative Renewable Energy in Puerto Rico Act Act 83-2010 Green Energy Fund Act Act 57-2014 Puerto Rico Energy Transformation and RELIEF Act Creates an Electric Energy Regulator; Removes the public policymaking powers from PREPA; Creates the electric consumer advocate

Act 4-2016 Creates Hatch Act for PREPA; amends CILT Act 22-2016 Reforms plethora of subsidies in PREPA’s Organic Act Act 120-2018 Puerto Rico Electric Power System Transformation Act Term sheet for the fire sale or P3 of PREPA Assets P.S. 1121 Puerto Rico Energy Public Policy Act (3/14/19) Broad statement of public policy principles; Amendments to existing laws; Additional legal teeth and resources to Energy Bureau; Demotes OEPPE to a Program under DDEC umbrella

PS 1121: What’s Missing? Two Examples: I. Solar Easements Regime. Potential 3,000 MW distributed installed capacity Amend Puerto Rico Civil Code to create and enhance Solar Easements Regime; Amend the Puerto Rico Mortgage Law to legally separate the solar easements from the principal property; Need an electronic registry for solar easements to facilitate financing II. Marine spatial planning for offshore wind. Potential 2,500 MW installed capacity Puerto Rico’s exclusive marine zone is 9 miles, not 3 miles; Follow the state-level marine spatial planning law passed by Rhode Island for the Block Island project

Prognosis LITTLE CHANGE AFTER THESE MANDATES PUERTO RICO HAS THE LAWS, BUT LACKS THE POLITICAL WILL TO EFFECT REAL CHANGE TO PREPA PREPA’S RESISTANCE AIDED BY RENT-SEEKING INTEREST GROUPS UNDER-BUDGETED ENERGY REGULATOR LUKEWARM COMMITMENT TO AGGRESSIVE DEPLOYMENT OF RENEWABLE ENERGIES LACK OF INTEGRATION WITH TRANSPORTATION, LAND-USE PLANNING, CLIMATE CHANGE AND OTHER SECTORIAL ENERGY POLICIES