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House committee grills APP officials over Luma contract, orders documents and opens probe of recent outages
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Summary
Officials from the Autoridad para las Alianzas Publico-Privadas told the Puerto Rico House committee that an APP-led investigation into recent widespread outages is under way and estimated a final report by late September; lawmakers pressed APP for staffing, budget and performance records and gave several five-day document requests.
SAN JUAN — Members of the Puerto Rico House Committee on Economic Development, Planning, Telecommunications, Public-Private Partnerships and Energy questioned APP officials at a June 20 hearing about oversight of the UMA/Luma Energy contract after a series of recent outages, including a prolonged transformer failure in Santa Isabel.
Fermn Fontanes Gmez, executive director of the Autoridad para las Alianzas Publico-Privadas (APP), told the committee that APP has opened an investigation "conforme a los procesos que están establecidos en el contrato" to determine what caused the outages and whether Luma breached contractual duties. "Estamos estimando que para finales de septiembre debemos de tener ese informe listo," Fontanes said when asked about timing for a final analysis.
The hearing focused on which entities have technical jurisdiction: APP said it administers contract compliance and approves large procurements, while the independent Negociado de Energa0a (the regulator) evaluates the technical metrics and can impose penalties. Fontanes stressed the two roles are complementary and described the oversight as a multi-agency effort that includes the Negociado, the Autoridad de Energa0a Elctrica (AEE), and federal coordinating teams.
Lawmakers repeatedly pressed APP to show how it verifies that Luma is meeting day-to-day operational and maintenance standards. Lizzy Burgos Muez, a committee member, told the panel, "La vida, la seguridad y la salud del pueblo de Puerto Rico va por encima de cualquier ineficiencia de Luma," and asked for concrete evidence that APP is enforcing the contract.
APP officials described their compliance team as small but active: Rubn Lugo, APPs compliance manager, confirmed the office has about eight full-time employees dedicated to the UMA/Genera portfolio and that APP maintains a services-professionals budget line (discussed in testimony) for outside support. Fontanes said roughly $9 million appears in the budget for services professionals, and that APP has approved about $500 million in vegetation-related contracts that Luma must execute under those procurements.
On penalties and contract termination, Fontanes told the committee that a unilateral cancellation of the contract without cause could carry an estimated fiscal cost of around $300 million while stressing that cancellation for proven contractual breaches would have different legal and financial outcomes.
Committee members pressed APP to provide a set of records within days. The chair directed APP to deliver, among other items, the cost breakdown for the eight compliance staff and contracts/payments from the nine-million-dollar services line; APP agreed to supply many documents but noted some figures required internal pulls.
The committee repeatedly requested that the Negociado de Energa0a appear at a later date to explain technical metrics and enforcement steps. Multiple lawmakers said the publics immediate concern is service reliability — not contractual nuance — and pressed for faster evidence and clearer customer-resolution processes.
The hearing closed after committee leaders asked APP to provide the requested documents and to return for follow-up testimony. APP reiterated it is conducting investigations and coordinating with the Negociado and AEE; legislators said they would press for public release of the investigations findings once they are available.
Next steps: APP will provide requested documents to the committee (committee gave several five-calendar-day deadlines), and APP estimated a written investigative report by the end of September, pending data collection and coordination with the Negociado de Energa0a.
