As Puerto Rico seeks to rebuild and modernize its electric grid, island officials are looking to mainland regulators for perspective on what approaches may be effective.

The National Association of Regulatory Utility Commissioners (NARUC) is sending a delegation of representatives from eight states and the District of Columbia to Puerto Rico for meetings Feb. 27 and 28, to provide advice on regulatory issues related to the island's electric grid and other services.

The U.S. Department of Energy is funding the trip to facilitate technical exchanges with the Puerto Rico Public Service Regulatory Board (PSRB).

Puerto Rico is strengthening its utility regulatory structure, in part to facilitate efforts to modernize its electric grid and make the island's system more resilient following widespread damage by Hurricane Maria in 2017. The NARUC seminar will consider how public-private partnerships could assist in grid operations, according to an agenda provided by PSRB.

The goal of this initiative is to "enable the exchange of experiences between jurisdictions considering similar regulatory matters in the areas of energy, telecommunications, transportation and consumer affairs," according to Jorge Camacho, a facilitator for the exchange on behalf of the Puerto Rico Energy Bureau (PREB) and former chief of infrastructure and system planning for the District of Columbia Public Service Commission.

Puerto Rico's electric grid was destroyed by Hurricane Maria two years ago, causing months of outages across the island. While the grid has been rebuilt, the island's electric utility, the Puerto Rico Electric Power Authority (PREPA), has also proposed widespread modernization efforts and the addition of renewables and microgrids to make the system more resilient. 

PREB sits within the PSRB, which is an umbrella group for Puerto Rico's regulation of energy, telecommunications, transportation and consumer affairs.  PREPA officials are not part of the NARUC seminar, according to Sheila Anglero, a communications consultant for PSRB.

The idea behind this week's meeting is to have "an exchange of topics relative to the island's needs," Camacho told Utility Dive.

The exchanges "will allow the participants to share highly technical expertise about the regulatory processes of essential services that are relevant to the functions of the PSRB," according to Edison Avilés Deliz, president of PSRB and PREB.

"This is an unique opportunity because it allows us to contrast our strengths with other jurisdictions and also pinpoints those areas where we may need to continue developing and adjusting our regulatory processes," Avilés Deliz said in a statement.

Public-private agreements, emergency funds will be on the agenda 

Puerto Rico is still working to identify how a full overhaul of its grid can be executed. PREPA's long-term plan calls for a system of eight "mini grids" that would utilize distributed resources to improve reliability during disasters. There are questions regarding how funds from the Federal Emergency Management Agency (FEMA) could be used, and what limits exist on those funds.

FEMA funds are generally not intended to meet renewable portfolio standards or grid modernization efforts, but instead must support projects that increase resilience. Camacho called that an issue of "potential semantics."

"There may be some elements of modernization that will increase resilience," Camacho said. "There may be some instances where, due to the technology available, work to increase resilience could be considered modernizing. Dismissing a proposal because it may be viewed as modernizing without considering how it will fit in the grid investment sequence could defeat the main goal of increasing electric resilience."

Camacho called it "a delicate balancing act.”

Puerto Rico is also considering turning to a private third party to run its transmission and distribution system, though the assets would remain publicly-owned by the island. The search for a partner in the private sector is being overseen by the Puerto Rico Public-Private Partnerships Authority, known as P3.

The public-private operating agreement being contemplated is one reason New York regulators sent representatives to Puerto Rico.

The New York Public Service Commission told Utility Dive it sent two staffers to the NARUC-PSRB seminar, though no commissioners made the trip. The state was selected to participate because it has experience with utilities accessing FEMA funds, as well as public-private utility operating arrangements.

​The Long Island Power Authority (LIPA) owns the electric transmission system on Long Island, but it is operated by New Jersey-based Public Service Enterprise Group (PSEG). LIPA was also able to access FEMA funds following damage by superstorm Sandy in 2012.

In a statement, the PSC said its involvement in the NARUC-PSRB exchange advances the state's commitment "to help Puerto Rico recover and rebuild" and "serves a state interest" because a significant number of New York residents have families on the island and travel there.

The sessions will not be open to the general public, according to a statement from the Puerto Rico government.

P3 identifies Quanta consortium as preferred public-private operator

The process to choose a private partner to operate Puerto Rico's electric grid is continuing. Four companies responded to a request for proposals issued by P3 to operate and maintain the utility's distribution and transmission network: Duke Energy, Exelon, PSEG Services and a consortium led by Quanta Services.

According to local media El Vocero, the Quanta consortium, which includes IEM and ATCO,  is preferred by the government committee evaluating the offerings.

A spokesperson for Quanta confirmed it had been "shortlisted" by the P3 Authority, but declined to give more details citing confidentiality agreements.

"Puerto Rico [regulators] have said they likely will announce the chosen proponent in March or April," Quanta spokesperson Jenna Jackson said in an email. "If awarded the contract, we remain committed to bringing excellent customer service, a safe working environment and a reliant, sustainable electric grid to the people of Puerto Rico."