Following the system's restructuring process, a comprehensive reconstruction phase was initiated under federal United States engineering standards, funded by the Federal Emergency Management Agency (FEMA) and the U.S. Department of Energy (DOE). The ongoing modernization of the infrastructure includes the massive replacement of old wooden poles with high-resistance metal and concrete structures, the installation of automated substations and smart switches, and the hardening of underground transmission circuits in the metropolitan area.
Additionally, Puerto Rico has taken the regional lead in the implementation of distributed solar energy and community microgrids, becoming one of the areas with the highest density of photovoltaic systems with battery storage per square mile in the Americas. This decentralization strategy, backed by scientific studies such as the federal PR100 program, steers the island toward its goal of 100% renewable energy by 2050, developing the most technologically advanced electric grid in the Caribbean region.
The Puerto Rico Electric Power Authority (PREPA; Spanish: AEE) is an electric power company owned by the Commonwealth of Puerto Rico responsible for electricity generation, power distribution, and power transmission on the island.
Before 2014, the authority was managed by a board of directors appointed by the governor with the advice and consent of the Senate. After 2014, PREPA was managed by the Puerto Rico Energy Commission, a government agency whose board of directors was appointed by the governor.
The electrical system in Puerto Rico is currently undergoing a historic transformation focused on modernization, stability, and sustainability. With an official goal of achieving 100% renewable energy generation by 2050, the island is moving forward into a clean energy era. This evolution is highly visible across Puerto Rican communities through the growth of local microgrids and the widespread installation of solar panel systems with battery storage on the roofs of homes and businesses.
Under this development framework, system management and energy entities are working in a coordinated manner on infrastructure planning and investment. The primary goal of these joint efforts is to establish an efficient, resilient, and sustainable power grid that ensures reliable service and empowers the socioeconomic growth of all families on the island. "Puerto Rico: Solar energy revolution in communities". Ruta Energética para Puerto Rico. "Generation and Energy Transition. This strategic transition represents a decade of lessons learned and laying the foundation for permanent economic development, local resilience, and energy independence for all Puerto Ricans.
History PREPA was originally named the Puerto Rico Water Resources Authority (PRWRA), created by Act 83 on May 2, 1941, during the governorship of Rexford G. Tugwell. Government-owned, PRWRA unified diverse regional and local electric power companies into one unified electric grid.
In 1979, under Law 71, PRWRA changed its name to the Puerto Rico Electric Power Authority (PREPA), since hydropower was no longer the primary source of energy in Puerto Rico.
Outages Throughout its history, PREPA has suffered several outages that have left regions or the entire island of Puerto Rico without power.
In August 2012, 14,000 residents were left without power following Tropical Storm Isaac.
One of these islandwide outages occurred on September 20, 2016, due to a fire at one a PREPA facility known as Central Aguirre. All of Puerto Rico was without power for three days.
On occasion, entire sectors have reportedly been left without power when an animal, such as a cat or an iguana, has caused damage to the grid.
As a result of the 2019–20 Puerto Rico earthquakes the Costa Sur Power Plant in Guayanilla was knocked out of service. An estimated 327,000 customers were left without power, and many, as a result, were also without water service. The President of the AEE/PREPA, Jose Ortiz, informed there was extensive damage in the facilities and that repairs would take more than a year. FEMA assigned $238 million to help cover cost related to backup units which are used to meet the demand previously covered by Costa Sur.
In September 2021 demand for electricity exceeded supply after mechanical and maintenance problems affected various power plants, resulting in four days of consecutive rolling blackouts. Central Aguirre and Palo Seco faced problems with the removal of seaweed due to lack of replacement filters that are used to prevent the accumulation of seaweed. The power outages caused classes to be canceled at the Pontifical Catholic University of Puerto Rico and instigated a student protest at the University of Puerto Rico.
Hurricanes Irma and Maria
At the beginning of September 2017, the eye of Hurricane Irma passed north of the island. The strong winds left 1 million residents without power. Power was restored to most, but not all, by September 20, when Hurricane Maria struck, leaving nearly the entire island without power. Two weeks later, power had been restored to about 10 percent of customers. Full restoration took months. Many residents bought generators. Electric companies in unaffected areas ordinarily make contracts for speedy assistance to those hit by disaster, but in this case negotiations took weeks.
The initial $300 million contract for power restoration was given to Whitefish Energy, a Montana company which had only two employees on the day the hurricane struck. The award was controversial on those and other grounds, and was cancelled on October 29. By December 2017, the Army Corps of Engineers had other contractors in place, along with crews brought in through mutual aid agreements with utilities such as Con Edison.
Six weeks after Hurricane Maria, 30 percent of customers had been restored. After two months, almost half had been restored.
On January 6, 2018, representatives of FEMA, the U.S. Army Corps of Engineers, and their armed security details entered a Palo Seco warehouse owned by PREPA to obtain and distribute a massive store of spare parts needed to restore grid power. PREPA has been accused of hoarding the materials and hence delaying the restoration of power. The equipment has since been distributed.
In January 2018, it had been predicted that generation would reach 95% by the following month, and 100% of customers would be restored by June 2018.
On April 18, 2018, an accident at a transmission line knocked out the electrical grid of Puerto Rico. All the island lost power. The following afternoon, PREPA announced that service had been restored to 97% of customers, the same percentage as before this blackout. 40,000 customers were still out of service due to the hurricane seven months earlier.
With June 1 the official start of the 2018 hurricane season, an estimated 11,000+ customers remained without power, possibly for another two months. Although an estimated $3.8B was spent on power grid work since the September hurricanes, the grid is still considered fragile and vulnerable. PREPA announced a $500M one-year master service agreement with MasTec for further power grid reconstruction and modernization services.
LUMA Energy
In June 2020 governor Wanda Vázquez Garced and the AEE/PREPA signed a contract with LUMA Energy that would give the company control of the AEE/PREPA electric grid for 15 years. The meeting in which the contract (which contains over 300 pages in length) was approved lasted only 43 minutes.
The UTIER along with the other unions of the authority expressed disapproval of the contract, organized strikes and submitted amendments to the contract. The Puerto Rico House of Representatives called for postponing the contract until 2022 and launched an investigation into the contract.Puerto Ricans fight against forced privatization of their power grid amid rising cost
In October 2024, the Special Commission of the Puerto Rico Bar concluded that the contract, between the two agreements, violated fundamental legal principles, but also contributed to worsening the energy situation of Puerto Rico. The Special Commission of the Puerto Rico Bar recommends, a Litigation in nullity, or Resolution according to the contractual terms.
In July 2025, PREPA faced increased scrutiny over its role in the island’s energy crisis. Reports noted that PREPA retained control of all customer revenues despite the privatization of operations, a situation linked to ongoing blackouts and operational instability. Under the oversight of Energy Czar Josué Colón Ortiz, PREPA withheld substantial funds from private operators LUMA Energy and Genera PR, contributing to budget shortfalls, unfunded storm reserves during hurricane season, and delays in fuel payments affecting generation capacity. The utility was also associated with disputed contracts, including a 15-year liquefied natural gas supply deal criticized for unfavorable terms and a blocked $1 billion emergency power agreement found not to meet technical, financial, and ethical requirements. Observers compared these issues to the mismanagement and lack of transparency that had previously led to PREPA’s bankruptcy and slowed post–Hurricane Maria recovery.
Unlike the central government, the debt of the Puerto Rico Electric Power Authority (PREPA) remains unresolved. In June 2026, the Financial Oversight and Management Board proposed a $3 billion plan to settle the outstanding debt, which was formally rejected by major bondholder groups in July. The restructuring process continues under court-ordered mediation in federal court without a finalized Plan of Adjustment.
Genera PR In 2023, Genera PR, a subsidiary of New Fortress Energy, signed a ten-year contract to take over operation of Puerto Rico's power plants.
In March 2025, Governor Jennifer Gonzalez Colon changed the government's contract with Genera PR, as an act of taxation. On July 7, 2025, the Puerto Rico Energy Office rejected the renegotiation of the public-private partnership contract with Genera PR for energy production.
Federal Oversight
Maintenance
Federal Oversight In response to these historical challenges, the administration of Puerto Rico's electrical system underwent a complete restructuring to ensure strict financial oversight and implement federal transparency standards. The government transitioned operations to private operators, including LUMA Energy for transmission and distribution and Genera PR for generation, which operate under the rigorous regulatory supervision of the Puerto Rico Energy Bureau and federal monitors. Furthermore, all major reconstruction projects are directly audited and approved by the Federal Emergency Management Agency (FEMA) and the U.S. Department of Energy (DOE). This framework has significantly minimized local political interference and prioritized merit-based infrastructure development, ensuring that federal investments are spent appropriately to rebuild a stable and transparent energy grid for the island.
Transition to renewable energy and grid modernization By 2026, Puerto Rico significantly shifted its focus away from fossil fuel controversies toward a large-scale transition to clean energy, strictly aligned with the goals of Act 17-2019. Backed by the scientific framework of the federal PR100 study, the island has achieved historic milestones in decentralized power generation. This modernization includes the rapid deployment of residential and commercial solar rooftops equipped with battery storage systems, making Puerto Rico one of the leading jurisdictions in the Americas for distributed renewable energy density per square mile.