1. Kenneth J. Nemeth
Secretary & Executive Director,
Southern States Energy Board

2. Recommendations: Immediate Goals
Passage of SB1121 is essential to the Island’s people, regulatory agencies, utilities, and investors by creating a pathway for the future
Conduct reliability systems analysis and modeling based on SB1121 to review any future needs for new, large generation sources.
Continue developing electric cooperatives where applicable on the Island
Create regulatory framework for the system operator chosen by the P3 Authority
Implement a functional national emergency response plan on the Island for resilient energy and telecommunication infrastructure
Review and resolve current permitting and siting issues associated with new energy installations
Determine whether the IRP is sufficient to guide the sustainable development of a resilient and reliable electric sector that supports a robust economy
Unbundle PREPA’s costs to support equitable and efficient rate design
Fully fund PREB to enable its technical capabilities
Empower PREB to regulate natural gas delivery and supply
Establish punch list of information required for PREB to contract with a system operator in the public interest
SB1121, pending House approval and Governor Rosello’s signature, is pivotal to providing direction for Puerto Rico and its future – in all sectors, especially energy.
Analysis by DOE finds expanding natural gas in the San Juan area would provide a foundation for renewable energy, improved reliability, and lowered costs
Recent figures from Argonne National Labs for DOE indicate that an estimated mw of generation in the San Juan area would aid to alleviate reliability concerns in the largest load center on the Island.
Electric Co-ops have proven to be a great asset to communities, most in rural areas, across the nation in providing affordable and reliable electricity.
With the P3 Authority set to choose a “qualified proponent” in the third quarter, estimated in September, it is imperative to be building a regulatory framework for this entity NOW.
A national emergency response plan should include participation from the utilities as well as the regulators.
All new forms of energy should be strategically placed to ensure they reduce impact on the environment while also to provide power and be quickly restored for repairs.
The IRP is a long term plan for the Island. However, the Island is changing much faster than the IRP and must be revisited accordingly.
Unbundling of pricing will provide greater transparency but is also needed as the Island will possibly see many electricity providers.
PREB must continue to be staffed with ongoing training made available to its Commissioners and staff to increase their expertise. Puerto Rico’s energy revolution also presents a chance to work with Universities and Colleges on the island in designing course work and degree requirements to grow the Island’s own people into these vital roles.
Although increased use of natural gas is something to be discussed and debated extensively, the PREB needs to be given this jurisdiction regardless; With the potential for one entity to serve the entire Island, this need is even greater.
With the concessionaire playing such a crucial role in electrical grid operations, the PREB needs full authority over any contract and clear, precise requirements for deeming such a contract in the public interest or not.

3. Recommendations: Short-term Goals
Transfer responsibility for preparation of the IRP to the System Operator (wheeling order) then to PREB for approval
Design rates based on actual cost
Determine an energy market required to support a robust electric system
Build small natural gas-fired generating units, where required for system reliability, and to promote the deployment of distributed renewable generation
Evaluate land use planning for developing energy infrastructure and how it affects the physical and economic health of the island
Determine Puerto Rico’s biofuel potential and associated employment demand
Evaluate the efficacy of fueling microgrids with biofuel
Ensure PREB has jurisdiction as the electric grid evolves
As the PREB staff grows, the number of entities involved in the electric system will also be growing. With a trained staff and transparent process, preparation of the Island’s IRP will ensure stakeholders from all sectors can participate.
The PREB should ensure customer rates are based on the actual cost of generating and providing electricity service.
As the grid changes on the Island, the likelihood of having a competitive market for electricity becomes very real. While there are many markets in the energy sector, each is different and electricity markets are often even more specific. Continued studies in grid operations will develop a more accurate and reliable market.
The path to 100% renewables will take decades to achieve; when new baseload generation is needed during this transition, small natural gas-fired units should be utilized.
While the Island has a real chance at deploying large amounts of renewable energy sources, biofuels should also be taken into consideration. While it may not be deployable in a wide scale, specific generating locations might exist. Possibilities of an Island grown fuel source with new jobs would be an added benefit as well as having a fuel source that doesn’t need to be imported.
With the PREB continuing to grow in its expertise overseeing a very fluid electric system, the bureau will need to be fully empowered over current and future entities, mergers and acquisitions of regulated entities, and other issues in the electrical and energy sector overall.

4. Recommendations: Long-term Goals
Establish requisite electricity markets for residential, commercial, and industrial ratepayers
Create an affordable, reliable, resilient, and cost-effective electric system that fosters sustained economic development and growth
Develop an energy management system that includes microgrids and distributed energy sources
Develop Puerto Rico’s economic biofuel potential and create a biofuel academic center of excellence
Examine opportunities to utilize renewable natural gas from landfills
Continue to balance the rights of Puerto Rico with creditor obligations while negotiating debt structures with PREPA bondholders
Zero carbon emissions
Establishing markets as competition enters the electricity system can allow consumers to select which entity they would like to be served by. However, this market must have a fully empowered regulator to protect consumers and ensure reliability and affordability.
The path to 100% renewables will take decades to achieve; when new baseload generation is needed during this transition, small natural gas-fired units should be utilized.
Energy costs are a crucial factor in economic development, particularly in manufacturing. While cheaper forms of electricity are increasingly becoming available, it is imperative to balance reliability and resilience with a cost that doesn’t hamper future economic development or residential customers.
Through the strategic deployment of distributed energy sources and their innerworkings with microgrids, these technologies will be to recover faster in outages and better provide electricity to critical loads.
Puerto Rico has taken great strides in reducing and restructuring its debts. As this process continues, ratepayers are in a delicate situation in regards to PREPA’s share of the debt.
With a future largely consisting of low-or-no carbon generating sources, Puerto Rico has a unique opportunity to shift to these zero carbon sources in the future.

5. Blue Ribbon Task Force Blue Ribbon Task Force
Review interconnection requirements to ensure they are reasonable and consistent with industry norms
Work with NERC to develop PR-specific reliability standards and procedures
Monitor/Report on efficiency and fairness of generating units’ dispatch on a regular basis
All new generation sources should comply with a uniform permitting/approval process
Establish a mandatory and widely-available certification/licensing process for solar installers
Review permitting processes currently in place for all major transmission lines and base load generation
Performance-based regulation should be used to incentivize optimal utility performance
A regulatory framework should guarantee the PREB operates without political intervention
Provide a regulatory framework for electric cooperatives, an integral part of the Puerto Rico energy system
Legislation should authorize the PREB to designate the service territories of energy providers
The PREB should be provided resources and authority to recruit and hire competent, professional staff
The PREB should be authorized to access relevant documentation from energy providers
The Consumer Advocate and related organizations should be enabled to provide relevant information
Energy efficiency, demand side management, energy storage, distributed energy resources, and electric vehicles (EV) should be included in a regulatory framework
Visit to read our draft report and other information on the BRTF
The BRTF produced consensus-based recommendations after three subgroups held focused discussions on markets, permitting, and regulations during our first meeting. These were included in our preliminary draft report which can be found on our website at
The BRTF also sent recommendations to be included in SB1121 to the legislature while the bill was in conference committee. These suggestions largely dealt with specific language issues noticed by BRTF members as well as some general suggestions for the legislation.
Please visit our website to see the BRTF members and read the draft report.