House hearing on bill to expand DACO oversight of rooftop solar exposes jurisdiction and resource gaps

Representative Edgar Robles Rivera, president of the House committee on consumer affairs, opened a public hearing on Proyecto 193 — a measure to amend the Ley Orgánica del Departamento de Asuntos del Consumidor (DACO) to give the agency explicit authority to regulate sales and acquisition contracts for distributed generation systems, with or without energy storage.

The proposal drew sharply different perspectives from consumer-protection officials, energy regulators and the solar industry. Licenciada Yasiris Torres Rivera, speaking for the Departamento de Asuntos del Consumidor, told the committee that “el DACO carece de jurisdicción expresa para reglamentar y fiscalizar de manera efectiva la venta y adquisición de sistemas de generación distribuida en Puerto Rico.” She said DACO’s present authority is largely limited to advertising and promotional practices and that taking on technical or interconnection disputes would require new rules, specialized staff and funding.

Antonio Torres Miranda, comisionado asociado del Negociado de Energía de Puerto Rico, said the Negociado supports consumer-protection goals but warned the bill must not be read to displace the Negociado’s technical jurisdiction. “Estimamos recomendable que se aclare de forma expresa que las facultades conferidas al DACO mediante el proyecto no deben entenderse como una limitación e interferencia ni desplazamiento de la autoridad conferida al negociado de energía,” Torres Miranda said, citing articles of Ley 57 de 2014 that assign technical, tariff and interconnection authority to the Negociado.

The Office of Independent Consumer Protection (OIPC) expressed support for the bill while urging clarifications and additions. An OIPC representative emphasized that different contract types exist — outright purchase, leases/arrendamientos and power-purchase/energy-sale agreements (PPAs) — and asked the legislature to define explicitly which contract forms the measure will regulate. The OIPC representative also recommended a taxative list of contract types, inclusion of a definition for “sistema de generación distribuida,” and that the bill preserve mechanisms to refer technically complex disputes to the Negociado.

The solar industry, represented by Javier Rua Jovet of the Asociación de Energía Sol y Almacenamiento de Puerto Rico (CESA), urged caution. Rua presented data he said show fast growth in rooftop systems but a low complaint rate by comparison. He told the committee that “hoy, 170000 familias ya tienen sistemas solares en sus techos” and estimated roughly 150,000 of those operate under lease or PPA financing. Rua warned that retroactive nullification of arbitration clauses in existing contracts could face constitutional and federal-law obstacles and argued that arbitration clauses are central to financing models that lower upfront costs for low- and middle-income families.

Several legislators pressed witnesses on concrete figures and local impacts. Committee members requested that DACO supply, within five business days, detailed tabulations of consumer calls and complaints related to solar systems by region and by age cohort; and separate information about the growing number of notices from the distributor (LUMA Energy) that some customers have received requiring a $300 study or retroactive charges. Representative Denis Márquez Lebrón and others noted that complaints appear to cluster in the south (Ponce, Mayagüez, Arecibo) and asked DACO to provide region-level breakdowns.

Witnesses described operational limits. DACO staff said the agency has limited inspectors and legal staff, no in-house technical experts in renewable energy systems, and budgetary constraints imposed by the Fiscal Oversight Board. DACO warned that if the legislature grants broader regulatory authority without new resources, the agency could become overburdened and consumer expectations might not be met. The OIPC and the Negociado each said they were willing to coordinate with DACO and suggested statutory language to clarify a working division of responsibilities and interagency referral processes.

On arbitration, witnesses described divergent legal and practical views. The OIPC and DACO officials said arbitration clauses have been used in some contracts to try to displace administrative jurisdiction, and that, depending on the facts, the agency has in the past treated arbitration clauses as inapplicable where there is an allegation of fraud or deception. CESA warned that retroactively invalidating arbitration clauses in existing, financed contracts could raise constitutional and federal-law conflicts and would affect the financing structures that enable many households to install systems without large up-front payments.

Multiple speakers and the committee chair also noted an absent LUMA Energy representative; Representative Robles Rivera said the utility’s absence was “una falta de respeto” and stated the committee will keep the record open and keep the commission active if necessary. Lawmakers signaled they will continue oversight: they asked DACO to file the requested data within five business days and indicated the committee will follow up on LUMA-related billing and interconnection practices.

Why it matters: The bill seeks to expand consumer protections for an industry that has grown dramatically since Hurricane María and now affects tens of thousands of Puerto Rican households, particularly low- and moderate-income families that rely on leased systems or PPAs to gain resilience and lower monthly bills. At the same time, the hearing showed unresolved legal and operational questions about which agency should handle technical interconnection matters versus commercial and advertising disputes.

The committee did not vote on Proyecto 193 during the hearing. Lawmakers asked the agencies to provide the requested records and indicated further sessions and drafting work will follow to clarify jurisdictional boundaries, prospective vs. retroactive effects for arbitration clauses, and resource needs for enforcement.

Ending note: Committee members said they will continue scrutiny of notices and charges recently issued to rooftop-system customers by LUMA Energy and will pursue legislative language that attempts to coordinate DACO and the Negociado while protecting consumers, particularly older adults and residents in heavily affected regions.