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Rebuilt power line issue, Puerto Rico cancels Whitefish energy contract

Published On Oct. 30, 2017 By Sharad

On Sunday, the governor of Puerto Rico moved to cancel a $300 million contract awarded to a small Montana company to rebuild part of the island’s battered power grid, as he is facing criticism from members of Congress and Federal Emergency Management Agency.

Nearly six weeks later after hurricane Maria destroyed majority of lines and poles, more than half of Puerto Rico is still experiencing lack of electricity. While the hot topic "how a company like Whitefish, Mont., with connections to the secretary of the interior but only two full-time employees secured an emergency contract that requires the work of thousands of people", have been argued among government officials in Washington and San Juan.

Some stores, medical centres, restaurants and a fortunate few private residences are running on generators, but most of the island’s 3.4 million people are plunged into darkness after sunset.

The Puerto Rican government said, the power grid is in such bad shape that, the Puerto Rico Electric Power Authority, known as Prepa, is generating just 30 percent of its normal output, and they even don't know how many of its customers are still in darkness after a sunset. The authority has said that repair will cost at least $1 bn.

Mr. Rossello said at a news conference on Sunday, that he had asked the power authority’s board which he appoints - to cancel the contract with Whitefish Energy Holdings, two days after FEMA issued a strong statement criticizing the deal. FEMA said it had “significant concerns” and warned that it might refuse to cover the costs of the contract if it was found to be improper.

In Washington, the contract has been attracting intense scrutiny. On Thursday, Natural resources house committee sent a letter to power authority of Puerto Rico and ask for a detail records related to the contract.

On same day, the inspector general’s office at the Department of Homeland Security said it was investigating. The Congress created board to oversee Puerto Rico’s financial affairs asked a federal court to appoint a new manager to supervise the utility, and Governor has order an audit for a contract.

Ricardo Ramos, the chief executive of the power authority, who awarded a contract, defend his decision but said that he understood the governor’s decision to cancel it because negative publicity and politics on the mainland had made the situation untenable.

Recently people had started throwing rocks and bottles at the company’s crews on the island, and were chanting that contract has been awarded corruptly, as a result, Whitefish had requested security protection.

Mr. Ramos said, if you are in your house without power, and there’s a sense that the energy authority gave away $300 million to a company that either had or did not have experience, the reaction is not positive, and we’re seeing that.

Democrats on the mainland and opposition politicians in Puerto Rico questioned the deal and were alarmed to see that the company’s chief executive, Andy Techmanski, came from the same small town in Montana as Interior Secretary Ryan Zinke. In an interview shortly after securing the contract, Mr. Techmanski told a local news station that he had been in touch with Mr. Zinke for more resources. Mr. Zinke’s son worked for Whitefish last summer.