Puerto Rico Cancels Energy Restoration Contract With Montana Firm

By Kenrya Rankin Oct 30, 2017

On Sunday, Puerto Rico’s Puerto Rico Electric Power Authority (PREPA) began the process to cancel the power restoration contract it signed with Whitefish Energy, a Montana-based firm that had only two employees when Hurricane Maria knocked out the commonwealth’s entire electrical grid on September 20.

The $300 million contract has come under scrutiny from those who object to owner Andrew Techmanski’s relationship with Secretary of the Interior Ryan Zinke, the company’s apparent lack of experience in this area and the fact that the contract was not competitively bid, per The Washington Post.

On Friday (October 27), the Federal Emergency Management Agency (FEMA)—which coordinates disaster aid—issued a statement saying it has “significant concerns with how PREPA procured this contract and has not confirmed whether the contract prices were reasonable.” According to The Post, the company is charging as high as $319.04 per hour for people who work on the power lines. The Corp of Engineers pays up to $195.04 an hour for the same job.

Puerto Rico governor Ricardo Rosselló announced the decision to cancel the contract at a press conference. “As a result of the information that has been revealed and the need to protect the public interest, as governor I am asking the power authority to cancel the Whitefish contract immediately,” Rosselló said. He also said that he has requested help from both Florida and New York under “mutual aid” agreements that utilities can activate during emergency recovery, and that with the agreements, the repair brigades will more than double from 400 to 1,000 by November 8. Puerto Rico’s recovery status website says that 70 percent of the commonwealth’s population—which is 99 percent Latinx—is still in the dark.

PREPA executive director Ricard Ramos told press that Whitefish will be paid to complete ongoing work on two transmission lines, which could take up to 30 days. He also said that, regarding the contract, “The best thing that can happen is its cancellation.” He continued: “There’s a perception risk, a reputation risk and a delay risk in continuing the contract.”

Governor Rosselló wants to appoint a “special outside coordinator” to monitor PREPA purchase moving forward, but last week, the oversight board installed to shepherd the island’s financial recovery said it will appoint its own manager. Back in the states, the House Committee on National Resources is planning a hearing on the awarding of the Whitefish contract, and the Senate Committee on Homeland Security and Governmental Affairs will hold a hearing on overall hurricane response tomorrow (October 31).

Whitefish issued a statement, saying the decision “will only delay what the people of Puerto Rico want and deserve.”

The company previously threatened a work stoppage when San Juan mayor Carmen Yulín Cruz criticized the contract.