We all know Puerto Rico as the colourful US commonwealth – a territory that shares the same currency as the US, but has its own method of electricity distribution (free of charge for everyone, currently!), and its own large accumulated debt of $72 billion (PREPA owes $9 billion of this chunk).
A recent report put out by the Institute for Energy Economics and Financial Analysis (IEEFA) argues against the “debt restructuring” plan that the Puerto Rico Electric Power Authority (PREPA) has put into place. The report points to the plan’s exclusion of renewables. Benjamin Zycher, from thehill.com, argues that IEEFA’s report, while it may show roads pointing to a more green-minded government, is not accounting for the great costs that Puerto Rico’s infrastructure would incur to support an influx of renewable strategies (an approximate $2.4 billion investment), not to mention back-up capacity costs, to cover unreliable wind and solar generation.
“Electricity prices on the island for residential, commercial and industrial customers are higher than those for the U.S. as a whole by 36 percent, 84 percent and 127 percent, respectively. Only Hawaii and perhaps Alaska pay prices higher. In part this is due to a highly inefficient generation mix: Over half of the island’s power is generated with oil.” Zycher goes on to support PREPA’s original and “viable” solution to their debt retirement, without putting such a costly renewables push in the mix, dismissing IEEFA’s intervention and renewables lobbying as careless and “grandstanding”.
What’s your opinion?
Do you agree with Zycher’s non-renewable stance on helping Puerto Rico right their debt, or do you feel that the latter is a huge blockade to Puerto Rico’s green energy progress?
Should Puerto Rico’s debt restructuring plan include renewables, or is a new green infrastructure too costly for this debt-heavy commonwealth?