Rebuilding Puerto Rico—The Marshall Plan Model

The devastation to Puerto Rico from Hurricane Maria has left this bankrupt island with no functioning infrastructure or means of economic recovery.  Although steps are being taken to get food and water to Puerto Rico citizens as well as to restore its electrical grid, it will take months to restore basic services and capabilities and much longer to rebuild its economy and infrastructure.

Puerto Rico’s economic conditions severely limit its ability to raise the funds for rebuilding, which was true of western European countries after World War II.  The Marshall Plan provided the needed resources under clear but strict requirements, including repayment.  The same approach could be used with Puerto Rico.

Restoring electricity is the highest priority after saving lives.  Without electricity, Puerto Rico’s economy cannot recover and its citizens’ quality of life will be among the worst in the developed world.  There should be a two-step process to restoring the electrical grid, even if that is more expensive.  The first step is to restore basic electric service throughout the commonwealth as quickly as possible.  Presently, only about 6% of electrical service has been restored.  The second step and the far more ambitious, expensive and time-consuming one  involves building a grid for the future that is hardened and has the resilience to quickly recover from hurricanes or any other event that can disrupt power.

The destroyed grid was comprised of 15 power plants of various sizes.  In 2016, 47% of Puerto Rico’s electricity came from petroleum, 34% from natural gas, 17% from coal, and 2% from renewable energy. Two wind farms provided half of the renewable energy and four solar facilities provided the other 1%.  According to the L.A. Times, Puerto Rico Electric Power Authority (PREPA) “appears to be running on fumes, and … desperately requires an infusion of capital — monetary, human and intellectual — to restore a functional utility.”  However, the utility has a history of poor maintenance, poor staffing, and allegations of corruption on top of a mountain of debt.  Given that history, PREPA is not the vehicle for rebuilding Puerto Rico’s electrical system and simply restoring the existing system would be foolhardy, as the residents of the U.S. Virgin Islands can attest.  Four times over the past 30 years, hurricanes have destroyed their electrical systems.

A grid for the future should minimize above-ground poles and transmission lines to the extent feasible and, where not feasible, the poles and lines to be hardened to the extent possible.  Generating facilities that were not made uneconomic will also need to be reinforced and perhaps converted from oil and coal to natural gas.  Because of the population distribution outside of major cities, dispersed areas could plan on microgrids when they become economical and reliable. These are localized electric grids that allow communities to keep power if centralized power plants stop functioning. They incorporate small-scale power plants as well as energy storage like batteries to maintain electrical power.  When central power is lost, microgrids would provide resiliency by becoming the primary source of power.  Microgrid development is being supported by DOE and also by DOD for use by the military in remote locations.

While solar and wind power can play a role in a rebuilt electric power system, it would be a serious mistake to count on them (as some environmental advocates do) for more than minor and back-up roles.  Category 4 and 5 hurricanes are too strong for wind turbines and can uproot solar panels which also can be damaged to excessive rain and debris.

Rebuilding a robust electrical power system can provide Puerto Rico a solid foundation for rebuilding its economy and becoming a model for the Caribbean region.

 

Author: billo38@icloud.com

Founder and president of Solutions Consulting which focuses on public policy issues, strategic planning, and strategic communications.

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