DOE Diverts Puerto Rico Solar Fund to PREPA, Gas
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- The Department of Energy scrapped Biden-era plans to use the 2022 $1 billion Energy Resilience Fund for rooftop solar and battery systems serving ~40,000 low-income Puerto Ricans with health conditions, redirecting a large share of the money to PREPA instead.
- PREPA received the funds through a noncompetitive, sole-source award — no competing bids solicited — justified under President Trump's executive order declaring an 'energy emergency'; $50 million is earmarked for a new natural gas pipeline connecting power stations in San Juan and Palo Seco.
- DOE waived its standard 50% cost-share requirement and accepted just a 1% contribution from PREPA, a concession a former Biden-era DOE official called 'potentially unprecedented' for an award to a recipient with nearly $4 billion in annual revenue.
- An internal DOE memo drafted by the head of the Grid Deployment Office flagged the decision's 'sensitivities,' acknowledging the sole-source designation, skipped 30-day congressional notice, and cost-share reduction 'may generate negative commentary' and 'raise objections to fairness, and perceived undue favoritism.'
- More than 40 congressional Democrats sent Secretary Chris Wright a letter last month demanding a briefing, calling the move 'potentially illegal cancellation of contracts' and warning that a methane pipeline would 'lock in' fuel import dependence and 'exorbitant' gas prices for decades.
- PREPA has been in bankruptcy since 2017, took more than nine months to restore power to parts of the island after Hurricane Maria, and completed very few modernization projects despite receiving more than $17 billion in prior federal grid funding.
Why it matters: Puerto Rican ratepayers — already paying among the highest electricity costs in the mainland U.S. — are now poised to fund a fossil-fuel pipeline instead of the rooftop solar and battery backups Congress authorized for 40,000 medically vulnerable households. The 1% cost-share and sole-source award, processed without a 30-day congressional notice, also sets a precedent allowing DOE to bypass competitive bidding and repurpose funds away from congressional intent.
