Puerto Rican business groups file legal challenge to hike in electricity rates
SAN JUAN, Puerto Rico -- A group of nine leading Puerto Rico industry and business associations are joining in an unprecedented legal challenge to a Puerto Rico Energy Commission (PREC) move to impose the first in a series of unlimited, "blank check" rate increases under the controversial debt-restructuring agreement for Puerto Rico Electric Power Authority (PREPA).
The filing seeks to block the rate hike that hinders the already weakened Puerto Rico economy and could unravel the PREPA debt deal.
If allowed to proceed, the initial 22 percent rate increase would be one of the largest in recent US history to be imposed on a state-wide or territory-wide basis. The June 2016 order by the Puerto Rico Energy Commission provided for a new surcharge to service the $9-billion PREPA debt restructuring. PREPA requested that the complete financial cost of the restructuring is passed to the Puerto Rico energy consumers plus an additional increase on the base rate.
PREPA is seeking to raise electricity prices by 22 percent in the first year of the plan or 4.2 cents/KWh, increasing the rates from 16.5 cents/kWh to 20.1 cents/kWh in 2017. The order also imposes the surcharges to energy generated by the consumer, "behind-the meter" generation, as renewable energy or other distributed generation means as co-generation.
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