Puerto Rico's Solar Revolution: What We Can Learn From the Island's Energy Crisis

Aug 28, 2023

Six years after Hurricane Maria crippled Puerto Rico's antiquated electrical grid, residents are embracing energy resiliency and renewables on their own terms. The mainland should take notice.

Puerto Rico has set an ambitious goal of 100% renewable energy by 2050.

When Hurricane Maria hit Puerto Rico on Sept. 20, 2017, it effectively demolished the island's aging and inefficient power grid, leaving 3.4 million residents without power.

Air conditioning couldn't work. Water couldn't be pumped to higher floors. Hospitals couldn't maintain lifesaving machinery. Diesel and propane generators helped, but they're costly and unwieldy and pump noxious fumes into the air.

It would be late November before more than half the island had electricity restored. And some remote areas were without power for nearly a year.

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Maria came just weeks after Hurricane Irma skirted the island. And it was followed by more hardships, including a magnitude 6.4 earthquake in January 2020 and Hurricane Fiona in September 2022.

Even in the absence of natural disasters, outages, rolling blackouts and appliance-frying surges are a daily reality in Puerto Rico. This ongoing energy crisis has forced residents to evolve quickly on renewables, especially solar power: The US territory has more rooftop solar installations per capita than all but six US states. (And that doesn't include smaller systems that aren't hooked up to the grid.)

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The island is especially well positioned to embrace solar: Studies suggest it receives enough sunlight to meet its residential needs more than four times over.

"Everyone should be keeping their eye on Puerto Rico," said Lauren Rosenblatt, co-founder of Barrio Electrico, which works to provide solar energy to low- and moderate-income households on the island.

"What the [rest of the] US is going to see is that there are a lot more options for resiliency and sustainability," Rosenblatt told CNET. "Not every solution that works in Puerto Rico will work in your community, but they're generating myriad solutions. We're lucky to have them leading the way."

Climate change is putting energy infrastructure to the test all over the US, and the challenges Puerto Ricans face -- and the solutions they're finding -- could be a glimpse at the future for those far from the island.

Here's what Puerto Rico can teach us about energy resilience, the benefits of solar and the role of community groups, utilities and government in reaching a sustainable future.

Climate change is making hurricanes more extreme and destructive. Scientists at Stony Brook University's School of Marine and Atmospheric Sciences found that, from 1850 to 2020, human-generated greenhouse gases led to an increase of more than 1 degree Celsius in global average surface temperature.

That warming trend "will lead to yet further increases in North Atlantic hurricane season extreme rainfall rates and accumulated amounts," the researchers wrote in the journal Nature Communications in April 2022.

As the intensity of severe weather incidents increases, so will the frequency of power outages. Solar panels, though, are designed to withstand hurricane-force winds: When Hurricane Maria hit, a VA hospital in San Juan remained fully operational while others lost power, thanks to its solar setup.

Javier Rúa-Jovet is chief policy officer for the Solar and Energy Storage Association of Puerto Rico, a regional trade association. After Maria, his home in a middle-class part of San Juan was without power for six weeks.

Relying on a 17-kilowatt generator for power, he said, was traumatizing.

"My whole nervous system was in tune with the noises it made," Rúa-Jovet told CNET. "Every day I was afraid the generator was going to die."

By the time Fiona made landfall last year, though, Rúa-Jovet had connected a Tesla Powerwall to his rooftop array and was able to maintain full power. Now, whenever there's an outage, the system kicks in automatically, often in less than a second.

"Sometimes you see the lights flicker when there's an outage," he said. "But usually you don't know until you get a notification on your phone."

Before Hurricane Maria, there were maybe 9,000 rooftop solar setups in Puerto Rico, according to Rúa-Jovet, and most weren't connected to batteries.

"After Maria, solar is basically universally installed with storage," he said. "It was really a paradigm-shifting event."

New installations have grown from a few hundred a month to more than 3,000.

In January 2022, there were 42,000 homes and businesses with solar-plus-battery projects in Puerto Rico, more than eight times the number before Irma and Maria.

This summer, that number is nearing 80,000.

That's still only a fraction of the close to 1.2 million households in Puerto Rico, but the desire to move beyond the grid is growing exponentially.

Hurricane Maria knocked down power lines across Puerto Rico. Some remote villages were without electricity for nearly a year.

In Puerto Rico, power isn't just unreliable, it's expensive. Residential electricity averaged 24.17 cents per kilowatt-hour in May, compared with 16.14 cents in the continental US. The cost of importing petroleum, natural gas and coal means electricity can be up to twice as much as it is on the mainland.

Solar is more reliable and cheaper in the long run, but installing a rooftop system still runs between $10,000 and $13,000. That's a steep price in a territory where the median household income is just under $22,000.

Financing options grew substantially after Hurricane Maria. Rúa-Jovet said solar companies like Sunrun and Sunnova offer terms that enable residents with a credit score of about 640 to get a rooftop setup without any upfront costs.

Instead of monthly electricity bills, he said, approved customers pay roughly the same amount in loan payments "for power that is clean and doesn't go away."

And unlike energy costs, the loan rates are fixed.

While Sunnova and Sunrun offer solar loans, there are still many in the commonwealth who can't afford financing. According to the US Census Bureau, 40.5% of Puerto Ricans live in poverty, more than twice the 19.7% poverty level in Mississippi, the poorest state in the US.

"There is a place for for-profit companies like Sunnova and Sunrun to offer [financing], but it's not a silver bullet," said Andrew Hermann, executive director of the Monte Azul Foundation, a nonprofit focused on energy and food equity. "We're going to need a lot of different solutions."

On July 31, the US Department of Energy announced more than $450 million was being allocated for distributed solar and battery storage in some of Puerto Rico's most vulnerable neighborhoods.

Secretary of Energy Jennifer Granholm said her agency was committed to expanding access to clean energy in Puerto Rico, "especially for the communities most at risk."

The funds will enable up to 40,000 setups to be installed in low-income areas hit with frequent and prolonged outages. (Households with energy-dependent devices like electric wheelchairs and at-home dialysis machines are also being targeted.)

"That's the best population to direct incentives toward," Rúa-Jovet said. "It's very targeted money that will help people that are basically outside of the financing market."

The investment is part of the $1 billion Puerto Rico Energy Resilience Fund established by the Biden administration to strengthen the island's grid and help it reach its clean energy goals. Further investments will be directed at community solar projects, microgrids and grid modernization, according to the Department of Energy.

A private US-Canadian consortium, Luma Energy took over responsibility for maintaining and improving the island's utility grid in June 2021. Its predecessor, the Puerto Rico Electric Power Authority, or PREPA, was a government monopoly that filed for bankruptcy following decades of mismanagement, negligence and corruption.

Luma inherited a decrepit system, but it has been blamed for failing to improve service and future-proof the grid.

"Its performance so far has been, in the best case, deficient, and in the worst, dismal," said Sergio Marxuach, policy director for the Puerto Rican think tank Center for New Economy.

Luma didn't respond to a request for comment.

On the ground, residents aren't waiting for Luma -- or lawmakers -- to provide solutions. In rural areas, grassroots groups are constructing standalone solar networks, known as microgrids, to ensure hospitals, schools and fire stations have power.

In Caguas, about 20 miles south of San Juan, donated solar panels were attached to the roof of an abandoned office building, transforming it into a supply center that doesn't rely on electricity from the utility.

"There are many communities -- small communities -- that are really making big waves and developing solar-plus-storage microgrids," Hermann said.

There's been so much interest, he added, "because so many people are just fed up with the current system. These communities are coming together to really choose a different path."

Arturo Massol-Deyá, executive director of the community environmental group Casa Pueblo, calls the movement an "energy insurrection." Casa Pueblo has been the driving force behind community solar in Adjuntas, a mountainside town of about 18,000. In an area where some people were without power for 11 months after Maria, the organization was able to install 700 solar panels and provide 220 kilowatts to more than a dozen businesses downtown. Second-hand EV batteries donated by automaker Rivian provide a megawatt of battery storage and allow Puerto Rico's first community-owned microgrid to provide power independent of the grid for up to 10 days.

Casa Pueblo worked with nonprofits like the Honnold Foundation and the Community Solar Energy Association of Adjuntas to fund the $2 million project. And while the merchants pay for the energy they use, their rates are significantly lower than Luma's. Profits are used for maintenance and to finance rooftop solar installations for low-income residents.

The endeavor's success has earned Adjuntas the nickname "Pueblo Solar," or "Solar Town."

The Monte Azul Foundation is working to develop a smaller microgrid in Maricao, a village of less than 5,000 residents that sees outages several times a week. It'll only generate between 100 and 150 kilowatts, but it will power a pharmacy, a gas station and the only bank in Maricao.

"When we don't have power, we lose access to ATMs and all our financial services because the bank has no backup power," Hermann said.

While the federal government has allocated more than $30 billion to help Puerto Rico recover from Maria and the 2020 earthquakes, critics say not enough is being done to develop energy resiliency.

In 2019, the legislative assembly passed the Puerto Rico Energy Public Policy Act, or Act 17, which set an ambitious deadline to use 100% renewable energy by 2050.

"Puerto Rico's Green New Deal," as Rúa-Jovet called it, sets a benchmark of 40% of electricity from renewables by 2025 and 60% by 2040. Right now, though, solar, wind and other clean energy sources generate only about 3% of the island's electricity. The remaining 97% come from fossil fuel-fired power plants.

In February 2022, the government-appointed Puerto Rico Energy Bureau conditionally approved 18 renewable power plants projected to produce 884 megawatts by the end of next year.

That's supposed to boost the share of electricity from renewables to 23%, but that's still short of Act 17's 40% goal. And environmentalists are suing to halt the projects because, they say, the plants will be built on agriculturally valuable land instead of rooftops, parking lots and landfills.

Regulators have also been accused of targeting recovery funds for fossil fuel projects. They even floated the idea of taxing solar users up to 4.6 cents per kilowatt-hour to pay down PREPA's $8.2 billion debt and discourage people from defecting from the grid.

After a three-year battle, the proposal was finally defeated in 2022.

Neither Luma nor the government in San Juan has actively opposed community microgrid projects, activists say. But they haven't done much to help, either.

"There isn't a whole lot of government involvement in rural mountain communities to begin with," Hermann said. "They're forgotten about in many ways.

In addition to keeping homeowners' power on during a blackout, solar-plus-battery systems that are connected to the grid can send energy back to the network during high-usage periods.

Using connected households or businesses to meet grid needs is commonly referred to as a virtual power plant, or VPP.

Luma is enlisting 6,000 customers for a pilot VPP program expected to launch this fall. When high-demand situations arise, the utility will access battery reserves from the participants, who are credited for the energy they provide.

"This program is being developed to address those days when Luma has a shortfall in energy generation," said Michael Juarbe, Sunnova's senior manager for government affairs. "What's very important to understand is that this is an opt-in program -- we're not forcing anyone to participate, and people can set how much they distribute."

The technology is there to do a much larger VPP network, Juarbe said, "but we know that you have to take slow steps."

Should it be successful, Juarbe could see a VPP generating a gigawatt of energy for Puerto Rico.

"We could replace a power plant based on dirty fuels and provide clean energy consistently to the grid," he said. "In the short term, we're talking about avoiding outages. But long term, I think virtual power plants are the future."

Puerto Rico's largest power plants are along the southern coast. But the most populous areas, like San Juan, are in the north. Transmission lines that cross remote mountain ranges are vulnerable to hurricane winds and take a long time to repair.

"Our energy paradigm is still a centralized system based on imported fossil fuels," Rúa-Jovet said. "That's the opposite of resiliency. If you hit one part, everything goes down."

The solution, he added, "is to have systems that are widely distributed, with lots of redundancies."

Solar-plus-storage microgrids "can decouple and operate independently of the main grid during blackouts," according to a position paper from the Rocky Mountain Institute, a clean energy think tank.

"We champion a highly decentralized, bottom-up grid approach that starts with personal microgrids, aggregated microgrids, then community microgrids -- all the way to municipal or even larger solar and storage systems," the group said.

Puerto Rico has been grappling with an energy crisis for years. But it's only recently that other parts of the US have realized how fragile their energy grid is.

Experts say the wildfires that devastated Maui this month may have been caused by downed power lines. The historic cold snap in Texas in February 2021 led to a massive multiday power outage and nearly 150 deaths from hypothermia. And in California, extreme heat, drought and wildfires contributed to 39 power outages last year, adding up to more than 414 hours without power.

Hermann from the Monte Azul Foundation said we can't wait for more disasters to reveal the cracks in our system.

Most of us take for granted that electricity is always going to be there.

"That's not the reality for Puerto Rico," Hermann said. "And now it's materially becoming a reality in climate-vulnerable parts of the United States."

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