The Financial Supervisory Board explains for the first time how much it will cost subscribers to pay PREPA debts

Announcing that they have reached a third agreement with the Electric Energy Authority (AEE) bondholders under which the accumulated debt has been reduced by approximately 80%, the FSB has detailed the provision that will be in line with state customers for the first time. Electrical system to comply with the agreed payment to these creditors.

The board stipulated, in a press release issued at midnight, that the provision to be charged to subscribers of the electric system corresponded to the annual interest rate of Series B (coupon) bonds, of approximately 7%, and that it “will be paid by old mixed fee consisting of fee A fixed connection and volume fee that will be added to the electricity bills of PREPA customers based in part on their energy consumption.

Prepa’s estimated old charges for subscribers who are not currently taking advantage of subsidized electricity rates will now be, on average, About $8.71 per month, which is a 5% increase in your total electricity bill According to the updated data of the financial plan of PREPA”, the board determined.

The outgoing letter adds that “the legacy fee from PREPA will exclude low-income residential customers who meet requirements for connection fees, volumetric charging of up to 425 kilowatt-hours (kWh) per month, and middle-income household consumption in Puerto Rico according to data provided by LUMA Energy.” and other sources Almost half of PREPA’s 1.4 million residential subscribers will not pay any old charges to PREPA if their consumption remains below 425 kWh per month.

Specific details released by the Board state that for non-subsidized residential customers, the old proposed fees from PREPA would be as follows:

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• A fixed connection fee of $ $1 per month

• $0.007 per kWh for up to 425 kWh per month of electricity provided by PREPA

• $0.027 per kWh for usage over 425 kWh per month.

For commercial, industrial and government customers, the proposed legacy fees from PREPA would be:

• Connection fees $1.25 per month for small businesses and small industrial clients Based on Up to $112.50 per month for large businessesin proportion to your current rate.

• Between $0.013 and $0.027 per kWh per month for electricity provided by PREPA.

It was clarified that “Prepa’s proposed legacy charges remain subject to approval by the Puerto Rico Bureau of Energy (NEPR), the independent energy regulator.”

In essence, the revised Third Amendment Plan aims to reduce more than $10,000 million in total claims by various creditors against PREPA by nearly 80%, to the equivalent of $2,500 million, excluding pension obligations.

On the subject of pensions, it was reported that “the treatment of PREPA annuities remains the same as under the Amended Plan III. PREPA retirees will be paid in full for all benefits accrued up to the effective date of the plan. After that date, neither existing nor new participants will be able to receive additional benefits.” Under the Defined Benefit Plan Current PREPA employees and those who previously went to work for the government, but continued with PREPA, can enroll in the Government Defined Contribution Plan.

Supervisory Board Chairman David Skell said, “This amended third plan represents a real breakthrough. After the most intense negotiation and mediation in the entire Puerto Rican debt restructuring process, we have built a plan with significant creditor backing that will allow PREPA to end its long bankruptcy. This plan will provide Creditors have a fair recovery given PREPA’s difficult circumstances, but without overburdening the people of Puerto Rico Our proposed revised plan is necessary for PREPA to continue to be a sustainable instrument, to continue important investments, and to complete the transformation of Puerto Rico’s energy system to provide reliable energy and support economic growth and stability Puerto Rico’s finances.

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Myrtle Frost

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