Hilda Lloréns: On March 21, the Black Start 2019 Summit was held in the San Juan Convention Center’s second floor. There, journalist Anderson Cooper and Fred Krupp, President of the Environmental Defense Fund, stressed the urgency for “transparency” from Puerto Rico’s government. Strikingly, Cooper likened the “lack of transparency” about the hurricane’s “true” death toll to the staggering lack of transparency in PR’s energy sector.1 This multisector gathering, organized by Center for the New Economy, seemed focused on bolstering Senate Bill 1121, “Public Energy Policy of Puerto Rico Act.”2 Among its mandates is using liquefied natural gas (LNG, methane) as “bridge fuel,” while building infrastructure to achieve 100% renewable energy generation by 2050. On the first floor, the 2019 American LNG Summit was also convening, hosted by Rep. Jenniffer González-Colón and Florida’s Rep. Ted Yoho. Governor Ricardo Roselló offered welcome remarks. Discussion centered on making Puerto Rico a “LNG hub,” in conjunction with JAXPORT, an LNG port in Jacksonville, FL.3 Together, they asserted Florida and Puerto Rico could offer US-LNG to Caribbean, Central, and South American countries, as an alternative to Venezuelan oil. Analyzed jointly these events point toward a possible future in which, on the one hand, Puerto Rico’s energy generation comes from renewables, and on the other, the island is an exporter of U.S.-LNG. Is this “progress”?
Conor Harrison: The provision mandating natural gas as a bridge fuel in the recently passed Senate Bill 1121, as well as discussions of Puerto Rico as a regional LNG hub, illustrates the important role that energy has and continues to play in Puerto Rico’s (and the Caribbean’s more broadly) regional development pathway. Puerto Rico and the Caribbean have been plagued by an energy model shaped by enslavement, colonialism, and neoliberalism. The region emerged between 1950 and the 1970s as an important refining and transshipment location for Middle Eastern oil destined for consumption in the United States. Puerto Rican refineries were particularly important as they were granted an exemption that allowed U.S. oil companies to sidestep restrictions on the use of imported oil in domestic refineries, as well as avoid increased costs stemming from unionized labor and environmental restrictions.4 Now, as the U.S. transitions into a fossil fuel exporter in the midst of an ongoing oil and gas boom, Puerto Rico is viewed as a location that can help reverse the flows of liquid fossil fuels—but notably, not reverse the flows of capital. Indeed, despite the 100% renewable aspirations in Senate Bill 1121, without broader political economic shifts the proposed changes in Puerto Rico’s energy system may offer a transition from fossil fuels to renewable energy, yet the system will remain entangled with private sector actors and regional geopolitical interests. The challenge, then, is to consider the extent to which any new energy system—renewable or otherwise—is reproducing existing dependencies versus enhancing Puerto Rico’s energy sovereignty.
Agustín Irizarry Rivera: PR Senate Bill 1121 mandates the use of imported liquefied natural gas (LNG, methane) to be burned for the generation of electricity. The Integrated Resource Plan (IRP) proposed by the Puerto Rico Electric Power Authority (PREPA) and Siemens (PREPA’s consultant) to the PR Energy Bureau indicates that Puerto Rico, with 3.2 million inhabitants and $105 billion GDP, will add three LNG terminals to the one terminal we have for a total of 4 LNG terminals in service in Puerto Rico.5 Brazil, with 209.3 million inhabitants and $2,056 trillion GDP, has three; India, with 1,339 million inhabitants and 2,597 trillion GDP, has five.6 Will this abundance of LNG terminals provide energy security for Puerto Ricans? No. After Hurricane María destroyed the electric transmission and distribution system there was plenty of fuel at the ready to generate power, but there was no interconnection between generation and demand.7 PR has abundant solar resources (1000 to 2000 kWh/kWp), and close to 1,000,000 residential rooftops to harvest this resource right where it is needed.8 Solar PV generation on rooftops is the most economical and least contaminating technology for those who seek to provide resiliency to the supply of residential electricity—not just in Puerto Rico but in the Caribbean.9
Abby Spinak: Hilda, Conor, and Agustín show clearly how centering political discourse around particular fuels in specific configurations distracts from bigger questions of local empowerment. With the acknowledgement that “energy democracy” is always material (both in the sense that democracy needs certain material conditions to flourish and that material assemblages indicate the health of political democracy), I want to raise questions about how PREPA’s financial resilience became so eroded before the hurricane that it was pushed to file for bankruptcy after, as well as how this financial vulnerability made possible certain kinds of recovery work (e.g. privatization) over others. Before we ask about whether the future of PREPA is public or private, distributed solar or LNG, those interested in “energy democracy” might ask: Where did PREPA’s money go, as it was taking on unwieldy debt? Who held that debt? What are the responsibilities of those people who profited from PREPA’s debt toward managing the risk of fiscal strain on a public infrastructure? How is it possible that the Puerto Rican electricity system “carries a huge debt but is very profitable” as a potential private acquisition?10 Finally, the framing in mainstream media that the privatization of PREPA is a form of post-hurricane recovery should not escape our attention. In other words, it is a dangerous lesson that the extractive and vulnerability-producing work of anti-democratic financialization can be effectively written out of history by extreme weather events.
Canay Özden-Schilling: “Grid defection” is growing in Puerto Rico. While left in the dark for months, schools, farms, and neighborhoods turned to “solar-plus-storage” systems that allowed them to source and store their own electricity;11 they now seem intent to keep these systems, given the uncertainty of PREPA’s future.12 In the emergence of these community-managed energy structures, there seems to be hope for a burgeoning “energy democracy”—a concept that evokes infrastructures for the equitable sharing of energy flows, decision-making mechanisms, and economic wellbeing, all at once. Focusing on any one of these principles alone won’t usher in energy democracy. For instance, like Agustín said, neither PREPA’s proposed microgrids13 nor PR Senate Bill 1121’s promise of renewable expansion guarantees that the geography of Puerto Rico’s energy flows will map onto its geographies of capital flows and political power. I don’t mean to romanticize grid defection: it is known that, at least in continental grids, the option is available only to the well-off and often makes low-income consumers’ grid dependency even more expensive.14 But given PREPA’s historical and current democratic dysfunctions, as outlined so well by everyone in this conversation, we should make sure to take seriously what community-driven solutions have already emerged in the aftermath of Hurricane Maria and how the communities striving toward them can be empowered.
John Harwood: There are many complex issues to respond to already; I will limit my contribution at this stage to one, which is that it is possible to see the disintegration of governance in Puerto Rico (and elsewhere in the colonies of the American empire, including its “colonies within” the 50 states) as part of the larger pattern of class struggle in the United States over the past two centuries. The current generalized neo-liberal crisis—in which widely distributed oligarchic pseudo-monopolies control not only means of production and distribution of commodities such as energy and food, but also the financial instruments that both enable and limit that production—may be seen as a historical echo of the collapse of turnpike and canal monopolies in the mid-19th century, the failures of the western railway monopolies at the turn of the 20th century, the failures of producers of consumer durables and lending institutions in the 1930s, and the “stagflation” and oil crises of the early 1970s.15 In each instance, although there are of course profound differences between them, the broader problem was the same: the refusal of the state to aggregate capital and administer large infrastructural systems, which would protect them from risk, provide net neutrality for end-users (consumers and municipal governmental institutions), and avoid producing massive financial imbalances that (at least temporarily) serve the interests of the capitalist class.16 Without mass social movements that actually threaten the very physical integrity of these infrastructures and their putative administrators in government and finance capital, we may expect the crisis in Puerto Rico to worsen until the “go-co” and bond-issuing techniques that have failed to date are replaced by a centralized federal bureaucracy.
Hilda Lloréns: On May 21, 2019, I interviewed attorney Ruth Santiago an expert on PR’s energy infrastructure, as well as its legal, political, and economic landscapes.17 We discussed the Public Energy Policy of Puerto Rico Act (1121), which appears to be little more than “lip service” and “business as usual,” because its dual-fuel requirement entails massive investments in LNG infrastructure, such as import terminals, energy generating plants, and the conversion of existing oil-fueled plants. “The glut of methane [natural] gas in the U.S. is generating immense pressure to allow the dumping of this fossil fuel in P.R. and the Caribbean. To compound matters, PREPA is a captured public agency that seems to respond to the fossil fuel industry more than to the people of Puerto Rico,” explained Santiago. “We should be gearing up at an accelerated pace towards an electric system based on local resources with community participation and control.” An advocate for energy generation and management as a source of community power in P.R., Santiago believes it could be the foundation for economic stability and local reinvestment with potential multiplier effects in the island’s economy. The proposed restructuring or renegotiation of PREPA’s debt would require residents who install renewable energy systems after next year to pay a “solar tax” for their own energy generation. Santiago warned, “this will have a chilling effect on the community-based transformation of the grid. The securitization of the debt would place hedge funds ahead of people who need electricity from the grid to power lifesaving equipment and medications.”18
Conor Harrison: The comments of activists in Puerto Rico reported by Hilda stand in stark contrast to the May 28 U.S. Department of Energy press release rebranding natural gas as “freedom gas” and “molecules of U.S. freedom.”19 While the unusual terminology provided ample fodder for commentators eager to mock the Trump administration’s bizarre new vocabulary, less reported from the release was the news that the Freeport LNG export terminal located in Quintana, Texas had been granted permission to increase LNG exports and would be expanding. Commentators also ignored that this announcement proclaiming increased fossil fuel exports was made at the Tenth Clean Energy Ministerial (my emphasis), a gathering of energy ministers seeking to “accelerate progress towards a clean energy future.”20
This has important implications for Puerto Rico’s energy future. First, as Agustín and Hilda make clear, adding LNG to Puerto Rico’s energy mix is not a short-term fix, rather a long-term commitment. Natural gas can no longer be thought of as a ‘bridge fuel’; new investments in gas exceed the carbon budget and will not allow decarbonization to happen fast enough. Hurricane Maria makes clear the horrific implications for further fossil energy lock-in. This leads to the second point, on the question of energy security. Importantly, energy security is not just security of supply; rather, for the U.S. and other energy producers, it is also about the security of demand.21 Given this, we would do well to make clear just whose freedom is enhanced by the export of so-called U.S. freedom gas to places like Puerto Rico.
Agustín Irizarry Rivera: In Puerto Rico the infrastructure of political representation, as pertaining to electric energy, is weaker that the actual electric infrastructure. The best example of this is the proposed Restructuring Support Agreement (RSA) for the debt of the Puerto Rico Electric Power Authority (PREPA).22
All revenue bonds issued by PREPA have the same guarantee: not property, nor taxes, but electric energy sales.23 Under the proposed RSA, a “transition charge” will be collected from electricity produced by all sources connected to the electric grid to pay new bonds. In this way PREPA will issue new bonds that will encumber the private generation of electric energy by a customer, including with renewable energy systems. Thus, through the RSA, a debt guaranteed by electric energy sales becomes a new debt guaranteed by consumption of electric energy from all sources connected to the electric grid. This change is an effective guarantee of profit for bondholders. Under current utility regulation rules in the U.S., public utilities are only guaranteed an opportunity to make a profit.24 Why should bond holders be granted a guarantee of profit not afforded to the company that issued the debt?
The proposed RSA is praised by the Government and opposed by almost everyone else: environmental groups, industry, commerce, unions, communities, academics, economists... all oppose the RSA. The Honorable Judge Laura Taylor Swain will soon decide whose argument will prevail. Or perhaps the People of Puerto Rico will again exercise their power, recently used to peacefully force the resignation of former Governor Ricardo Roselló, to secure a fair debt restructuring.
Abby Spinak: We seem to be united in the view that Puerto Rican electricity restructuring is lipstick on a capitalist pig. I wonder how we can go beyond that critique, and want to use my last contribution to ask if “energy” is fundamentally the wrong place to look for democracy?
My research follows a New Deal electrification program that also looked very much like grassroots energy democracy but in practice became a project of market expansion. I was therefore not surprised to learn that PREPA began under the gubernatorial administration of Rexford Tugwell, who, after designing much early New Deal rural agricultural legislation in the 1930s, was appointed by President Franklin D. Roosevelt to hold the office from 1941–46.25 Tugwell unabashedly brought the mindset of development as democracy with him to Puerto Rico, and seems to have viewed the island as a tabula rasa for modernist planning: he variously referred to Puerto Rico as an “interesting laboratory” and a “pilot plant for induced economic development.”26
I agree with John that there is much to be gained by a responsible state taking on governance of infrastructure… but not if the public authority sees market development as the highest public good. That will, as history has generously shown, only reproduce imperial hierarchies—including, as Canay warns us, in the guise of distributed generation. So, I’m left wondering if the growth ideology built into these mid-century infrastructures fundamentally constrains them from being a platform for “energy democracy.” Does “energy democracy” in this context fall prey to a definition of energy as a neutral resource that just needs to be harnessed in the right way? Rather, I might argue that “energy” itself is fundamentally a Western institutional logic and discourse that naturalizes local subordination to global markets, inequitable wealth consolidation, and the continued production of sacrificial landscapes.
Canay Özden-Schilling: In the United States, low-income households pay more in electricity bills—often not only relative to their income, but also per square foot of their houses.27 Energy inequality works in a way similar to capitalism: those with access to capital find ways to lower expenses over the long run, whereas those with limited capital can’t cover the startup costs for energy-saving measures, like insulating their dwellings or purchasing their own production equipment, and thus lock themselves in to high bills. In Puerto Rico, where the average income is one third that of the U.S. and the average electricity bill triple that of the U.S., the situation is more dire.28
The plans to get PREPA back on its feet, as summarized by Hilda and Agustín, seem to continue the refrain: utilities thrive by charging those least able to afford their costs, and by channeling public funds to large private producers. But let us not forget: utilities like PREPA depend on the continued participation of a large number of small consumers, not a few select large consumers, for continued profit. This presents, I believe, an opportunity to rethink energy democracy—perhaps an ill-fated concept as Abby notes— but a notable one, nonetheless, in its effort to build overlapping circuits of consumption and decision-making. However disenfranchised and captive small consumers may be, together they are still the lifeline of utilities; their value to the system can be leveraged to reverse an energy politics that has for so long reduced citizens to consumers.
Workers repair power lines in San Juan, Puerto Rico (Fluor Corporation)