The transformation of Puerto Rico’s electric system is the foundation for our economic development. For decades, this infrastructure was neglected due to a lack of proper maintenance and capital improvements. Hurricane María in 2017 exposed the extent of its deterioration, which required nearly $2 billion in FEMA emergency funds to restore service across the island by 2018. In September 2020—still in the midst of the COVID-19 pandemic and managing the southern earthquakes—an announcement was made approving $9.5 billion in FEMA funding for the resilient reconstruction of the electric grid. What has happened since then?

First, it’s important to note that the $9.5 billion initially did not include disbursement authorization. Nor did it include mitigation funds. The Puerto Rico Electric Power Authority (PREPA), LUMA, and Genera must submit detailed scopes of work for each project to FEMA, which then evaluates compliance with federal environmental and historic preservation requirements. During this process, FEMA assigns mitigation funds. In fact, the letter estimating $6.8 billion in mitigation funds (in addition to the $9.5 billion) was received in January 2023 (this amount is expected to increase significantly and is currently under FEMA review). Second, each project must be approved by the Puerto Rico Energy Bureau to ensure alignment with the island’s energy public policy. Third, FEMA funds operate on a reimbursement basis. For a bankrupt PREPA, this was a serious obstacle. Fourth, as if that weren’t enough, Hurricane Fiona in September 2022 further destabilized the electric grid, prompting FEMA to authorize the temporary installation of emergency generators while reconstruction and integration of renewable energy progress.

That said, from no FEMA-approved projects in December 2020, there are now 198 project groups totaling $7.7 billion that have been officially approved. Currently, poles and street lighting are being replaced, substations and power plants are being repaired, and modernization programs for meters, grid automation, and vegetation clearing are underway. All of this has been supported by the transition from a reimbursement model to an advance payment system implemented in June 2022 (Working Capital Advance). Equally important, other FEMA-approved projects include new substations, a new centralized energy management system, and microgrids for Vieques and Culebra. They also include new rapid response units and large-scale battery systems. Genera recently announced the awarding of these critical machines and equipment through a competitive process.

Despite the progress made over the past four years—and recognizing that our recovery is the largest and most complex in FEMA’s history, that federal requirements are strict, and that the recent Tropical Storm Ernesto further exposed the grid’s vulnerability—LUMA and Genera can take additional steps to continue accelerating reconstruction. For example: (1) improving both the documentation submitted to FEMA for project obligations and the documentation submitted to COR3 for disbursements; (2) fine-tuning project management; (3) expediting the procurement of long-lead-time equipment; (4) increasing the hiring of local companies and suppliers; and (5) optimizing communication about their short-, medium-, and long-term plans.

Although measurable progress has been made in reconstruction projects, we cannot settle for the current pace. On the contrary, by improving execution and facing present challenges with effective strategies, it is possible to reach an optimal pace of reconstruction. There is light at the end of the tunnel.