Dive Brief:

  • The Puerto Rico state legislature adopted on Monday a bill that would set a 100% renewable portfolio standard (RPS) by 2050 as part of a broader package of energy reforms.
  • The U.S. territory will join Hawaii, California and Washington, D.C., with its 100% RPS target, which includes interim goals of 40% renewables by 2025 and 50% by 2040. Similar to Hawaii’s island economy, Puerto Rico’s energy customers faced high prices from importing fossil fuels for power generation as well as resilience issues from extreme weather and vulnerable transmission infrastructure.
  • SB 1121 was delayed after the House left session March 18 without approving the unified version of the bipartisan bill. The bill awaits Gov. Ricardo Rosselló’s signature.

Dive Insight:

Puerto Rico has been rebuilding its grid following the widespread damage from 2017’s Hurricane Maria, which left 1.5 million residents without power for almost a year. The new package of energy policies seeks to advance the transition from baseload fossil fuel generation to distributed clean resources.

The Puerto Rico Electric Power Authority’s (PREPA) integrated resource plan (IRP) shows “a very renewables-friendly narrative,” which “would have been unheard of before the storm, completely unheard of,” Javier Rua-Jovet, Sunrun’s Puerto Rico public policy director, told Utility Dive.

That includes the largest solar and energy storage buildout in the United States. The addition of storage would address the intermittency of wind or solar, according to Jorge Camacho, a PREPA consultant and former regulatory staffer in Washington, D.C.

The renewable resources are competing with liquefied natural gas (LNG), a cleaner imported fuel compared to diesel, oil and coal generation.

“There is still an appetite in Puerto Rico for baseload, [and] to satisfy those baseload needs with gas,” Camacho told Utility Dive.

EcoEléctrica, a private generator in Puerto Rico that imports LNG and burns it in a coastal 504 MW combined cycle facility in the south of the island, has “stellar performance,” Camacho said. However, their 25-year power purchase agreement is ending soon and the 100% by 2050 RPS mandate will lead regulators and other stakeholders to re-evaluate the length of a new contract, he said.

“In order to get to 100% by 2050, you know you cannot go ahead and do another 25-year [contract] with EcoEléctrica, that doesn’t make sense, right?” he said.

PREPA received criticism for including gas infrastructure in its latest IRP: three LNG import terminals.

Connecting new resources to the grid can also be a challenge. The bill would establish hard deadlines for distributed solar interconnections: 90 days for medium-sized systems (25 kW to 5 MW) and automatic interconnection for small projects (under 25 kW).

“Even though interconnection of a residential system to the grid should be really fast, it might take months and months and months [with] PREPA, and it has little to do with technical resources, it seems to have to do with administrative resources,” Rua-Jovet said.

While Sunrun has had productive meetings with PREPA, “having a clear law helps because if at some point we find a roadblock, it might take going to the Commission” to resolve it, he said.

As part of SB 1121, the Puerto Rico Energy Bureau will be able to establish performance-based metrics for renewable resource penetration. “Those types of metrics make sense when you have a more rational and, I guess, more private utility,” Rua-Jovet said.

The bill would also ban coal plants starting in 2028. According to the Energy Information Administration, there is only one coal plant on the island, a 454 MW facility at Guayama.