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July 22, 2010

Puerto Rico sets 15% renewable electricity target for 2020

With a population of four million, Puerto Rico is currently heavily reliant on imported oil for its energy supplies, leading to electricity prices twice the US average

Puerto Rico has adopted a Renewable Portfolio Standard, seeking to generate 15% of its electricity from renewable sources by 2020.

Luis G Fortuno, Governor of the US territory, signed measures into law yesterday, which will also require retail energy providers to draw up plans to source 20% of their energy from renewable energy proejcts by 2028.

The Caribbean island is aiming to “aggressively” improve the 1% proportion of its energy supplies that currently come from renewable sources

The new legislation will set up a system of Renewable Energy Certificates to drive clean energy procurement – certificates that can be bought or sold alongside green energy, to offer added incentives to developers of renewable energy projects.

Incentives

The Governor also signed a law that provides a series of short, medium and long-term financial incentives to help set up a “solid” renewable energy industry in Puerto Rico.

This includes a $290 million Green Energy Fund to invest in renewable energy projects and initiatives over the next 10 years.

Cash rebates will offer up to 60% project costs for residents and 50% costs for businesses to install renewable energy systems up to 1MW in output.

And, commercial-scale renewable energy generators will be provided with tax relief for new facilities, along with tax credits if equipment is produced and jobs created locally.

Governor Fortuno said: “We need to aggressively encourage the development of renewable energy sources for the benefit of all that reside and work in Puerto Rico. Establishing the right public policy will be the anchor to make it happen.”

“Win-win”

A Renewable Energy Commission is being set up, comprising five representatives of key organizations and two members appointed by the Governor, to oversee progress.

Jose Ramon Perez-Riera, Secretary for Economic Development and Commerce, who, along with other public officials, will have a seat in the newly created Commission, said: “Renewable energy policies and sound economic incentives are key to attract players of all sizes that can contribute to the creation of a renewable energy industry in Puerto Rico, jumpstart competition and be an active part of the solution.

“This can lead to innovation-based development and new job creation, while attending concerns over high energy prices and environmental effects of petroleum-based generation emissions. It is a win-win for all,” added Secretary Perez-Riera.

We will be relentless in our efforts to reduce the cost of electricity” - Governor Luis G Fortuno

Diversification

Puerto Rico has a population of almost four million, who face electricity prices twice the US average thanks to the island’s dependence on oil for about 70% of its supplies.

The Fortuno Administration is aiming to cut dependence on petroleum to 48% of electricity generation without raising the use of coal from the current 15%, and without increasing natural gas from the current 16% share of electricity supplies to more than 24%.

“Diversification of our energy sources can not wait any longer. The cost of electricity is undoubtedly the number one obstacle to Puerto Rico’s competitiveness and one of the main concerns of our people. We will be relentless in our efforts to reduce the cost of electricity for all and we are confident that our energy reform legislation will have a profound influence across the board,” said the Governor.

Last month saw Pattern Energy Group agreeing a deal to develop 75MW of wind generating capacity in Santa Isobel (see this BrighterEnergy.org story).