A dozen community and environmental organizations submitted detailed expert analysis to the Puerto Rico Energy Bureau (PREB) recommending that the Puerto Rico Electric Power Authority (PREPA) be ordered to prepare a new Integrated Resource Plan (IRP) due to serious deficiencies identified in the current IRP.
The IRP is the roadmap that will determine energy sector investment and priority projects for PREPA for the next 20 years. The IRP has economic, social and environmental implications for all Puerto Ricans.
In a 195 page-long motion, the organizations presented expert testimony that proves, among other things, that the IRP is based on self-convenient considerations to favor the over-construction of natural gas infrastructure and prolong reliance on fossil fuels. Such preference would have significant impacts to the economy and the health of citizens.
In the document, filed on October 23, the organizations presented the expert testimonies from Agustín Irizarry Rivera, Anna Sommer, Daniel Gutman and Ronny Sandoval, all with vast experience on energy matters.
In their analysis, Irizarry Rivera and Sommer conclude that PREPA underestimated the cost of electricity production with liquefied gas, leaving out of its calculation the benefits that would be produced from integrating customer-based distributed generation.
The motion indicates that the projections on the cost of liquefied gas are "too optimistic" and do not approach the actual cost of gasification in current facilities. For example, Irizarry's study indicates that the IRP assumes the cost of $4.35 per hour thermal unit (MBTU) for liquefaction, transport and profit, which is "extraordinarily optimistic" compared to current cost contracted by PREPA with New Fortress Energy at $8.50/MBTU for the same items.
"The assumption on the cost of delivered methane (liquefied natural gas) is wrong," says, among other conclusions, the report by Irizarry Rivera, electrical engineer and researcher.
Irizarry Rivera, former consumer representative of PREPA’s Board of Director and author of numerous studies on energy trends added: "Results and recommendations of the proposed IRP are all dependent of the assumed fuel cost. This fact alone should require a new IRP.”
Likewise, the analysis indicates: "Distributed self-generation was not seriously considered in Siemens analysis. There is no explanation on why this option was not considered." Based on current evidence from the industry, customer based distributed generation, by means of photovoltaic systems on rooftops and storage, has been identified by the intervening organizations and their experts as the most cost effective energy alternative for Puerto Rico.
Expert testimony presented by the organizations adds data proving that PREPA's plans would aggravate public health and air quality problems from PREPA’s facilities in Costa Sur, San Juan and Aguirre.
In his report, Gutman, an expert in the analysis and effect of public utility emissions on human health, points out that the best alternative for Puerto Rico to meet federal air quality standards is to leave behind fossil fuel burning plants and to move towards the use of non-polluting sources. The document warns that "PREPA's preferred plans ... invest too many resources into fossil fuel generation, and not enough in non-polluting sources."
Other rate increases with damaging effects to the economy loom ahead
The expert analysis is comprehensive and concludes that the IRP lacks numerous elements and safeguards that are critical to ensuring consumers see the benefits PREPA claims. At the same time, the expert testimony presents recommendations to ensure that the IRP that is approved represents the real contexts and the current and future alternatives that would yield greater benefits to clients and to corporation investments.
The report by engineer Sandoval, president of the consulting firm, ROS Energy Strategies, recommends that the Bureau include in the IRP metrics and processes that promote the adoption of distributed energy resources, such as residential and community renewable systems and energy storage. In addition, Sandoval recommends working “proactively with customers and third parties to support emerging DER (distributed energy resources) projects at various stages of development in order to further manage investments for serving critical loads."
Sandoval proposes that the PREB "work with stakeholders to define the appropriate metrics that would allow one to measure the performance of projects that support the successful execution of its IRP over time and identify opportunities for maximizing value, including course correction as appropriate."
The environmental and community groups argue that the integration of stakeholders into the development of a new IRP broadens the framework of alternatives and clears potential conflicts of interest. The organizations state that Siemens should not be participating in the development of the IRP as the company sells machinery and technology to PREPA. In fact, Siemens representatives have admitted in IRP technical hearings that they use Siemens’ products as parameters in the IRP.
The filed testimony can be found at http://energia.pr.gov/wp-content/uploads/2019/10/LEOs-Motion-for-Submission-of-Testimony-with-Testimonies.pdf
The intervening organizations that filed the motion in the Energy Bureau are: Comité Diálogo Ambiental, Inc., El Puente de Williamsburg, Inc. -Enlace Latino de Acción Climática, Comité Yabucoeño Pro-Calidad de Vida, Inc., Alianza Comunitaria Ambientalista del Sureste, Inc., Sierra Club y su capítulo de Puerto Rico, Mayagüezanos por la Salud y el Ambiente, Inc., Coalición de Organizaciones Anti-Incineración, Inc., Amigos del Río Guaynabo, Inc., Campamento Contra las Cenizas en Peñuelas, Inc., and CAMBIO Puerto Rico. The groups have participated in all three IRP technical sessions conducted by the Bureau during August and September. Citizens can participate of the IRP evaluation process and thus are invited to stay informed and provide comments on the document, which is available at energia.pr.gov. The Bureau is scheduled to hold a public hearing on January 10, 2020. The period for public comments ends January 17.