SAN JUAN, Puerto Rico — A record electricity rate went into effect Thursday in Puerto Rico as outages persist and the U.S. territory’s power grid continues to collapse.
A residential customer who uses 800 kilowatt hours per month will see their monthly bill increase by about 18 percent, from $229 to $271, according to the Puerto Rico Energy Office, which approved the increase.
The new rate will remain in effect until at least Dec. 31 and is expected to increase the already high cost of living on the island of 3.2 million people, where more than 40 percent of residents live in poverty.
The new rate of 33.86 cents per kWh far exceeds the average rate of 18.3 cents per kWh for residential customers in the continental United States, according to the U.S. Energy Information Administration.
Luma Energy, which oversees electricity transmission and distribution in Puerto Rico, had requested an increase of more than six cents per kWh and stressed that it would not generate additional revenue for the company, but rather cover increased costs.
“The difference is due to higher energy consumption due to high summer temperatures, higher global oil prices resulting from the Middle East conflict – which has limited fuel transportation and increased costs – greater use of customer batteries and the need to rely on more expensive fuel when power plants are not producing enough electricity,” Luma said in a statement.
The increase comes as outages persist nearly a decade after Puerto Rico’s power grid was flattened by Hurricane Maria when it hit the island in 2017 as a powerful Category 4 storm, even though the grid was already weak due to a decades-long lack of maintenance and investment.
Last week, a massive fire at a substation left more than 200,000 customers without power in the latest outage to hit the island.
The Energy Bureau said in a statement Wednesday that it approved an increase of 5.28 cents per kWh to reduce the financial burden on customers.
He noted that he did not pass on the $17.6 million cost associated with what he called New Fortress Energy’s alleged failures to supply fuel from June to August.
“Fuel costs should not be automatically passed on to the consumer simply because they have been incurred or billed,” the Energy Office said.
New Fortress Energy supplies natural gas to power plants on the north coast of Puerto Rico. Currently, these plants use diesel, which drives up costs because a ship loaded with a natural gas delivery was prevented from entering San Juan Bay for two weeks due to its size. The case remains mired in court.
The Energy Bureau said it was also investigating some $19 million that Luma said was paid for quantities of gas that officials said exceeded what Genera PR “ultimately needed or could receive.” Genera PR oversees electricity generation in Puerto Rico.
The increase comes as Puerto Rico Governor Jenniffer González’s administration is pushing to cancel the contract with Luma, with the matter currently pending in court with ongoing lawsuits.
Luma and Genera PR have won contracts as the Puerto Rico State Electric Power Authority struggles to restructure its more than $9 billion in debt.
In 2024, oil represented 63% of the island’s overall energy consumption; natural gas accounted for 31 percent, coal 5 percent and renewable energy 1 percent, according to the U.S. Energy Information Administration.
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