Potential fuel cost adjustments related to generation of electricity, not LUMA operations, may potentially impact future customer rates.
LUMA urges the media to report the facts of FCA: As has been the case since 2021, LUMA is not responsible for generation, fuel costs, or any factors related to fuel and generation costs that impact customer rates.
San Juan, Puerto Rico, Dec. 17, 2024 – As part of LUMA’s role as the T&D operator, today the company filed to the Puerto Rico Energy Bureau (PREB) the calculated quarterly factors for the Fuel Cost Adjustment (FCA) and Power Purchase Cost Adjustment (PPCA) tariff riders. The upward shift in the factors is due to higher-than-expected fuel costs from June to November. During many of these months, overall energy consumption was higher than expected due to unusually high temperatures, and GeneraPR increased its use of expensive fuel to generate electricity, resulting in a possible increase of approximately 2.3 cents per kilowatt-hour to the average residential customer bill. This generation-related rate increase recovers costs of fuel used to generate electricity and energy purchased from Independent Power Producers (IPPs) and does not fund LUMA operations. As has been reiterated extensively over the last three years, LUMA is not responsible for generation, has no control over the impact of fuel costs, and does not benefit from any changes to electric rate factors as part of this process.
“We know how frustrating it can be for our customers to see their rates go up. Generation and fuel costs account for about 70% of customers’ total rates and clearly, more must be done to reduce generation-related rate increases. While LUMA is not responsible for generation, the cost of fuel used for generation, or the impact of fuel costs on customer bills, we remain committed to supporting our customers and addressing the legacy challenges that continue to impact Puerto Rico’s energy system, even as we work toward building a cleaner, more sustainable energy future,” said Mario Hurtado, LUMA Chief Regulatory Officer.
LUMA is NOT Responsible for Fuel Cost Rate Adjustment
LUMA is not responsible for generation, nor any associated fuel costs. As the grid operator for Puerto Rico, LUMA’s role in this quarterly process is to calculate fuel costs based on information provided by GeneraPR and Independent Power Producers (IPPs). It is important to also note that LUMA does not add any non-related costs to these riders and does not benefit from any changes, as these adjustments are only in response to the cost of electricity generation.
Fuel Cost Adjustment Details
The electric rate factors report the cost of generation fuel used by GeneraPR and power purchased from IPPs between June and November. The factors impacting the FCA calculation are the result of higher demand and the need to use more expensive diesel and bunker fuels to generate electricity due to lower-than-expected availability of GeneraPR’s less expensive natural gas generation units.
Building a Cleaner, More Sustainable Energy Future for Puerto Rico
LUMA is advancing Puerto Rico’s clean energy transformation at a historic rate, connecting more than 135,000 rooftop solar systems, representing more than 940 megawatts of clean energy for the island. Looking ahead, in 2025 and 2026, LUMA will be interconnecting over 780 megawatts of new utility solar, which has zero fuel costs, and is executing the Accelerated Storage Addition Program in the next 12 to 16 months, which will add at least 110 megawatts of utility-scale batteries to the electric system and produce savings to customers of over $100 million per year.
Committed to Supporting Customers
To lessen the impact of fuel costs and help customers save on their electric bills, LUMA is taking a series of actions, such as providing customer discounts on energy efficient appliances. LUMA also remains committed to supporting and serving customers who may be concerned about paying their bills as a result of this adjustment through payment plans, government assistance programs and subsidized rates for customers who qualify. Customers are encouraged to find more information by visiting lumapr.com, calling 1-844-888-LUMA (5862) or visiting any of LUMA’s 25 customer service centers.
About LUMA
LUMA is a Puerto Rican company that, since June 1, 2021, operates and manages the electric power transmission and distribution system in Puerto Rico. LUMA is a company driven by a mission to transform the electrical transmission and distribution system to provide all Puerto Ricans with the reliable, resilient, clean, and affordable electrical service they deserve. As a customer-centric company, LUMA’s entire workforce is focused on safely delivering an exceptional customer service experience to its 1.5 million customers.
