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Have We Made Any Progress?


September 23, 2004
Copyright © 2004 CARIBBEAN BUSINESS. All Rights Reserved.

"The longstanding inability of Puerto Rico officials and government agencies to assure an adequate, uninterrupted flow of electricity and water to island homes, businesses, and industries is now out of the closet for the world to see. It’s tragic that it took the unleashed force of a hurricane to do it."

That’s what CARIBBEAN BUSINESS wrote Sept. 28, 1989, the week after Hurricane Hugo hit Puerto Rico.

Sadly, 15 years later, almost to the day, we seem to be no better off.

Perhaps we’re worse off. Unlike Hurricanes Hugo and Georges (1998), both of which hit us with winds of 130 miles per hour (mph), Tropical Storm Jeanne had wind gusts of no more than 60 or 65 mph. Yet, the inability of local government officials to deal with a relatively mild tropical storm has wreaked havoc throughout the island, whose economic losses could top $1.5 billion.

Mind you, the losses aren’t the result of physical damage caused directly by the storm. Physical damage to buildings and infrastructure was minimal. A few fallen trees here and there may have broken a few fences; a few signs may have been blown off; and flood-prone areas may have been inundated. Overall, though, there was very little physical damage.

Most of the economic loss will be the result of the days-long lack of the basic utilities of electricity and water. The population at large obviously has been discomforted, but business and industry have borne the brunt of the losses in terms of business interruption. The island completely shut down for two full days and only gradually thereafter started to operate as the electricity and water services were restored.

At press time Monday, six days after the storm, close to a quarter of the population was still in the dark.

By the administration’s own admission, the total blackout of Puerto Rico wasn’t the direct result of the storm but a deliberate move by the Puerto Rico Electric Power Authority (Prepa) to shut down the power grid at 10 a.m. Wednesday, when storm winds of 40 to 60 mph had just started, arguably to prevent damage to the system. The decision wasn’t announced in advance to allow citizens and businesses to prepare. With the electricity down, most water service throughout Puerto Rico, which depends on electric pumps for distribution, immediately got cut off.

Prepa’s decision to shut off power has generated a great deal of controversy, obviously magnified by a general election only 45 days away. But it isn’t just politics. The decision could mean millions of dollars in losses due to business interruption that might not be covered by insurance companies because they were caused by the government, not by the storm.

Whether it was a bad decision from an electrical engineering point of view isn’t for us to determine. Apparently concerned with the good reputation of the engineering profession, the local College of Engineers has publicly called for Prepa to come clean and present evidence to substantiate its decision. Prepa should do just that. Otherwise, it would appear to justify the criticism of those who say the top post at Prepa should belong to an engineer, such as former Executive Director Miguel Cordero, not a certified public accountant such as current chief Hector Rosario.

But beyond those issues is that the resulting mess from shutting down the electrical system could have been avoided if our electrical infrastructure were up to par. It isn’t. If it were, there would have been no reason to fear potential damage from a storm that supposedly prompted Rosario to shut down the system.

In fact, sources inside Prepa acknowledge that during the past four years, maintenance and upgrade of the utility’s infrastructure have been all but neglected, and that’s the reason Prepa’s top management feared a total collapse of the system.

That’s deplorable. During the eight-year tenure of Miguel Cordero, coming-from-behind Prepa gained good ground in the effort to furnish Puerto Rico with a decent electrical infrastructure and decent service.

Four years later, here we are pretending to sustain a First World economy with a Third World electrical system.

This Caribbean Business article appears courtesy of Casiano Communications.
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