Out LUMA!: Puerto Ricans demand an end to the privatization of energy

The agreement between LUMA Energy and the government of Puerto Rico has not solved its main objective to solve the island’s serious electricity problems

July 05, 2024 by Pablo Meriguet
Workers from UTIER marching in San Juan. Photo: Se Acabaron Las Promesas

Hundreds of Puerto Ricans took to the streets of the capital, San Juan, on Wednesday July 3, to demand an end to the controversial contract signed by the government of Puerto Rico with the US-Canadian company LUMA Energy. During the march, organized by the Union of Electrical and Irrigation Industry Workers (UTIER), workers and activists shouted slogans like: “Privatized energy is rejected by the people”, “We demand electric energy because it is a human right”, and “They privatize energy and steal from us every day”, among others. According to the protesters, there has not been a significant improvement in the electricity service as promised with the privatization. Major blackouts and electricity connection problems continue.

Walter Rolón, interim president of the UTIER, explained that the privatization of basic services carried out by the Puerto Rican government must be stopped: “Demand the annulment of those contracts, which were fully endorsed by the Fiscal Control Board and the US Congress, as a wonderful agreement. [They promised] that there would be no increase [in prices], and there have already been eight [increases], the most recent one last Monday. It is the worst service.”

A controversial agreement

After spending several months without electricity due to the destruction caused by Hurricane Maria in 2017, the administration of then-Governor Ricardo Roselló (who resigned in 2019 amid strong protests over a leak of offensive and homophobic messages in a group chat) promised to solve the energy crisis by privatizing electric power.

The LUMA agreement, which went into effect in June 2021, allowed the privatization of the island’s electricity system which was previously controlled by the government. Henceforth, it was agreed that LUMA Energy would manage Puerto Rico’s essential electrical infrastructure (except power plants) for 15 years, in exchange for USD 1.5 billion. However, the privatization not only did not deliver on the promised improvements but users have also seen a significant price increase.

LUMA Energy is being challenged not only by social organizations and thousands of users who have already protested against the US-Canadian company on several occasions, but also in the island’s legislature. In June of this year, the Puerto Rico House of Representatives approved Joint Resolution 660, which intends that the contract signed between the government of Pedro Perluisi Urrutia and LUMA Energy be rescinded. In addition, the legislature ordered a meticulous evaluation of the contract.

The spokesperson for the legislative majority, Ángel Matos García, said that “the agency in charge of the electric system has not performed its function of repairing or replacing equipment and electric transmission infrastructure, nor has it complied with the plan to remove weeds and remove branches, which has been one of the causes of the constant blackouts”.

More mobilizations against LUMA Energy have been announced, which will continue to demand the end of an agreement that fails to solve the structural problems of the Puerto Rican energy system.