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Puerto Rico’s Colonial Legacy Doomed It To Dirty Electricity — And Now Darkness

A class-action lawsuit filed in 2015 accused PREPA of more than $1 billion in fraud, claiming it had taken kickbacks from oil suppliers including Brazil’s Petrobras and Royal Dutch Shell.

By Alexander C. Kaufman: 28 Sept 2017

Puerto Rico plunged into darkness last week after the second major hurricane in a month crippled its aging, debt-laden electric utility. The island is projected to be without power for six months or more, as people swelter and lifesaving medical equipment saps generators in what House Speaker Paul Ryan declared “a humanitarian crisis” on Tuesday.

But it’s not just old, storm-vulnerable transmission lines that need to be replaced.

Forty-seven percent of the power the troubled Puerto Rico Electric Power Authority generates is from burning oil ― one of the most polluting and least efficient sources of electricity. An additional 51 percent of Puerto Rico’s energy blend comes from a mix of coal and natural gas. Just 2 percent was drawn from renewable sources last year.

The utility’s dependence on imported fossil fuels has devoured funding that could have been spent on upgrading the island’s grid and building cleaner infrastructure, a sign of years of mismanagement and incompetence. But it also stems from a colonial history in which Puerto Rico’s development was put in the hands of a few mainland corporate interests seeking tax breaks.

“The fact is that safety and reliability must be PREPA’s first priorities, above all other considerations,” a searing reportcommissioned by the Puerto Rican government concluded last year. “Energy efficiency and renewable energy take time to implement; PREPA’s system is in a desperate state today.”

The report described the utility’s budget as “opaque and distortionary,” made worse by “poor record keeping.” The generous $134 million allocated for discretionary spending ― nearly one-third of the annual budget ― suggested a slush fund. Alleged corruption only made operating costs higher. A class-action lawsuit filed in 2015 accused PREPA of more than $1 billion in fraud, claiming it had taken kickbacks from oil suppliers including Brazil’s Petrobras and Royal Dutch Shell.

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