Funding Cuts, Debt, and the Fight for Renewables

What’s next for Puerto Rico’s energy development?

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Editor’s Note: We welcome journalist Jillian Melero of Connect Puerto Rico. We hope you enjoy the work that Jillian is creating with a newsletter outlet that is “curating and contextualizing news on policy, business, science, and technology affecting Puerto Rico's energy transition.” Connect Puerto Rico is also a member of Tiny News Collective, our fiscal sponsor. You can subscribe here.

A federal funding freeze threatens key projects, while Gov. Jenniffer González’s push to extend coal use raises concerns about sustainability and public health. At the same time, PREPA’s $9 billion debt crisis stalls investment, even as Luma Energy plans to add 990MW of renewables and 700MW of energy storage.

Meanwhile, powerful fossil fuel interests are doubling down on efforts to block clean energy policies. With so much at stake, the question isn’t just about keeping the lights on—it’s about who controls Puerto Rico’s energy transition.

Federal Funding Freeze Sparks Concerns

The Trump administration recently issued a directive to pause all federal grants and loans, triggering uncertainty for programs nationwide. The freeze impacted environmental, climate, and public health funding, which are areas critical to Puerto Rico’s ongoing recovery and infrastructure development.

Why It Matters for Puerto Rico

  • Puerto Rico heavily relies on federal funds for disaster recovery and infrastructure projects.

  • Past funding delays —such as the extra federal oversight on HUD recovery grants— have already slowed Puerto Rico’s rebuilding efforts.

  • The freeze could stall renewable energy projects and modernization plans necessary for a resilient power grid.

  • Federal judges temporarily blocked the freeze, citing constitutional concerns.

  • Some agencies reportedly continued withholding funds, adding to confusion.

  • While the White House rescinded the freeze, it remains unclear how Puerto Rico’s projects will be affected.

What to Watch

  • Will federal agencies resume funding Puerto Rico’s recovery efforts?

  • How will this impact ongoing energy and infrastructure investments?

  • What legal challenges could arise if funds remain delayed?

Governor Moves to Scrap Renewable Goals

Puerto Rico’s Gov. González has proposed eliminating renewable energy goals and extending the life of the island’s only coal-fired power plant.

What to Know

  • A new bill would remove renewable energy mandates and keep the Guayama coal plant running past 2027.

  • Environmentalists & health experts warn of increased pollution and health risks if coal use continues.

  • The coal plant supplies 20% of Puerto Rico’s electricity (454 MW annually), and officials claim shutting it down without a replacement plan risks power shortages.

  • Power outages in Puerto Rico increased by 11% last year, underscoring ongoing grid instability.

  • The governor signed a $767M deal with Tesla for energy storage —yet is moving away from renewables.

  • If Puerto Rico set renewable energy targets in 2019, why hasn’t a transition plan for the coal plant been developed?

Why It Matters

This fight isn’t just about power—it’s about public health, sustainability, and political priorities.

To read the rest of Jillian’s story, go to Connect Puerto Rico.

About the Author

Jillian Melero is a journalist, editor, and founder of Connect Puerto Rico.

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