Hurricane María Exposes Problems Within Puerto Rico’s Solar Panel Industry - NBC Bay Area
Puerto Rico Recovers After Maria

Puerto Rico Recovers After Maria

Complete coverage of relief and recovery efforts in Puerto Rico, following Hurricane Maria

Hurricane María Exposes Problems Within Puerto Rico’s Solar Panel Industry

Equipment provided by Sunnova, with 62 percent of the residential renewable energy market in Puerto Rico, stopped generating power, while Casa Pueblo organization was one of the few that succeeded.

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    Caguas resident Rafael Rivera is one of the Sunnova customers who had no power after Hurricane María.

    Although her solar panels successfully sustained Hurricane María’s winds, Madeline Batista couldn’t turn on her lights, her refrigerator or other appliances that needed electricity. The photovoltaic system, installed at her Naguabo home by Sunnova, stopped working. It was connected to the Puerto Rico Electric Power Authority (PREPA) network, which was destroyed by the hurricane. 

    Meanwhile, in the mountains of Adjuntas, community organization Casa Pueblo still had power. Neighbors sought help from the facility, the only place with power in town during the María emergency. Casa Pueblo’s solar panels were equipped with batteries that allowed it to operate full time, independently from PREPA, and have power at night. The place became an autonomous energy oasis. People went there to charge their phones, receive respiratory therapy with energy-powered machines, and above all, organize to help each other after the worst natural catastrophe the island experienced in its modern history. It was a concrete example of community self-management. 

    However, most of the more than 10,362 renewable energy units installed by Puerto Ricans ended up as a roof ornaments, as in the case of Batista, according to an investigation by the Center for Investigative Journalism (CPI). The Naguabo resident belongs to a group of consumers that purchased energy packages from Sunnova Corporation, whose photovoltaic panels and services have not delivered on the promise of saving money. Although it is not the only company that installs this equipment in Puerto Rico, the Texas company is the main provider of renewable energy for residences, and the only one certified by the Energy Commission to offer them as leases.

    Before Hurricane María, more than 1,000 people had filed complaints against Sunnova at the Independent Office of Consumer Protection (OIPC), a consumer advocate that monitors PREPA and energy companies. The complaints were mainly related to overbilling problems from Sunnova. 

    Batista’s backyard is a parcel of land that can be crossed from one end to another in less than a minute. It has cement planters on both sides of her clothesline, where Batista grows yautía, moringa, mango, chives, papaya, kale, in addition to raising chickens and geese. She says it is for food security and self-sufficiency. That’s part of the reason why she decided to install solar panels—Batista wanted to be ready for when PREPA’s service failed. 

    Three years earlier, she signed a contract with Sunnova to buy solar energy and rent 16 photovoltaic panels. The bill was $108 per month for 25 years, with an additional payment of $3 per month to PREPA. She says she always has to pay more. 

    Batista climbs an aluminum ladder up to her home’s roof and shares her frustration: “I like solar energy because it is clean and produces no noise, but if you do not have a battery that allows you to disconnect from the network, the panels do not work.” When she entered into the energy purchase agreement with Sunnova, nobody from the company or PREPA informed her that the photovoltaic panels wouldn’t work even during the day, when the sun was out. 

    According to Batista, Sunnova said it can solve the battery problem, but it would mean a an additional contract for energy storage equipment. Batista believes it is not a good deal for her, since it means spending even more money.

    Products Without Batteries
    Solar products without batteries were never established in the Puerto Rican market to withstand hurricanes, but to produce savings on customer bills, said Máximo Torres, an engineer and founder of Puerto Rican company Maximo Solar. 

    “That model is for the United States, but in Puerto Rico there are blackouts and hurricanes,” Torres added. His company supplied photovoltaic panels financed by Sunnova until 2017, but it is no longer associated with Sunnova. Now his company installs equipment with batteries, like those at Casa Pueblo. 

    The realization that solar equipment connected to power grids would not work in stronger hurricanes was not a new revelation for companies like PREPA (a public corporation), Sunnova or Maximo Solar. In 2012, for example, hundreds of residents in New York and New Jersey could not operate their solar energy equipment during Hurricane Sandy, a category 2 storm. 

    That was a learning experience for the industry: when the transmission and distribution of energy are carried out through a centralized infrastructure, the system is more vulnerable to hurricanes—as demonstrated by María, which led to Puerto Rico’s grid collapsing because power plants were connected to a single source at PREPA. 

    Faced with the reality that most of Puerto Rico’s energy is produced in the island’s southern region and is mainly consumed mainly in the metropolitan area (after being transported through the mountains by cables that the winds destroyed), the alternative is to produce power through microgrids. In other words, produce energy in many sectors near different consumption centers, said engineer Lionel Orama, coordinator of the Island’s National Institute of Energy and Sustainability (INES), a group of University of Puerto Rico academics that conducts research to solve the island’s energy problems. 

    “María slapped us in the face and made us learn that we have to change the way we see the photovoltaic system, not just as a way to pay less money to PREPA, but to achieve security during hurricanes,” Orama added.

    Energy Independence in the Mountains
    On Dec. 26, Alexis Massol, one of the Casa Pueblo founders, drove to the Saltillo sector of Adjuntas, crossing a bridge over a ravine, traveling through a muddy road and arriving at a cement house. There, the transmission antenna of Casa Pueblo’s radio station was being set up. Unlike the organization’s headquarters located in Adjuntas’ urban area, this house had to depend on a power plant after the hurricane. 

    Since then, there are now 42 solar panels that Radio Casa Pueblo has recently installed on the roof and on a ranch behind the house. Inside, there is a battery bank that provides power for three straight days, in case bad weather does not allow the panels to receive enough sunlight. 

    Efraim Ayala, a technician for Maximo Solar, lowered a “PREPA” lever to take Radio Casa Pueblo “off the grid” or outside the network. “They are now disconnected from PREPA,” he informed Massol. And that’s how Radio Casa Pueblo created Puerto Rico’s first radio transmission tower powered entirely by a renewable and independent source from PREPA. 

    “We no longer have to pay money to the Authority. We will have savings,” said Massol, who is internationally recognized with the Goldman Environmental Prize (considered the “green” Nobel). “I feel happy. The energy we produce does not have to affect the environment because it is clean. We want to be prepared for climate change.” 

    Casa Pueblo, with almost 40 years of community self-management and activism in favor of environmental causes, is one of the few organizations that can claim victory. Hurricane María revealed that of all the residential, commercial and industrial solar projects connected to PREPA (including those of companies besides Sunnova), only a few were able to operate independently after a failure in the power network. The equipment is part of the net metering system, in which companies sell part of the energy they produce with their renewable systems to PREPA. 

    “About 10 percent of all those connected to the net metering system have batteries,” Francisco Rullán, executive director of the State Office of Public Energy Policy (OEPPE) told the CPI. “Now, with the onslaught of the hurricane, I would tell you that most want to install them.” María brought about a great change in the island’s renewable industry: the push to install batteries. 

    For Efraín O’Neill, energy systems researcher at the University of Puerto Rico’s Mayagüez campus, talking about energy security and independence also means that local companies must be in charge of managing the renewable system. 

    Texas-based Sunnova has 62 percent of all the net metering system business at the residential level in Puerto Rico, according to research by the CPI. 

    The net metering system has 10,362 customers, PREPA told the CPI. In addition to Sunnova’s 6,000 customers who are already connected to the network, it has almost 4,000 customers waiting for PREPA to connect them into the net metering system, which would give the company 97 percent of Puerto Rico’s residential business for renewables. 

    “We went from fossil dependency to renewables dependency with a company that is not from here. We continue to send the money out of the island,” O’Neill said about Sunnova’s market dominance. 

    “This worries me. You have another PREPA basically. This is a problem,” said José Alberto Pérez Vélez, the OIPC’s director, regarding the development of a possible monopoly. “The company then has more responsibility in terms of the guidance it must offer to customers. We have to prevent these companies from becoming what PREPA was, through overbilling, poor service and inefficiency.” 

    Cars Become Generators
    In Batista’s garage, there is a car with the hood open. She had to connect a 1,500-watt inverter to the vehicle’s battery, and plug in an extension cord to carry power to the refrigeration appliances and the fan. But she needed to pump more and more gas every time to keep the car on and protect the battery.

    “Sunnova told me that in the meantime, to solve the problem, I should buy a power generator,” she added. “And I can’t stand generators. I can’t sleep with the noise.” 

    Madeline Batista’s car became an energy source
    Photo credit: Photo by the Center for Investigative Journalism

    Having a power generator or using the car completely goes against Batista’s goal of cleaner energy. According to Batista, using more power from fossil fuels is what causes global warming. 

    “This movement from citizens who are for renewable energy, for cleaner energy, don’t deserve that after they make such a large investment,” said Pérez Vélez. 

    Sunnova’s Response
    Sunnova, however, blames PREPA for the interruption of its customers’ service. 

    “People were left without power because of PREPA’s regulations. Solar panels cannot work if PREPA’s grid does not work. If the network collapses, all renewable systems collapse 100 percent,” said Karla Zambrana, general manager of Sunnova in Puerto Rico, during an interview with the CPI. 

    Renewable equipment is automatically disconnected when PREPA’s service is interrupted. It is a security measure to avoid sending electricity to PREPA’s network and protect employees who are repairing the grid. 

    On Oct. 10, during meetings that Gov. Ricardo Rosselló held with different sectors, he asked Sunnova representatives to find solutions. “The goal was to eliminate the bureaucracy of the interconnection process with PREPA, so that customers, once the grid is restored, can begin to enjoy the service quickly without the bureaucratic process,” Zambrana told the CPI. 

    For the OIPC, the problems with the net metering system are a shared responsibility with PREPA. “When the net metering system started, you could have been waiting for PREPA to connect you for more than a year. Then there was 2014 and 2016 legislation that lowered the time to 70 days. It is a significant step forward, but we are well behind,” Pérez Vélez said. “There are jurisdictions in the United States where you can do it online and it takes two or three days. It’s not fair that you have to wait so long to produce clean energy.” 

    As of today, the island generates only 2 percent of its energy from renewable sources, mainly from solar and wind utilities contracted under the administration of former Gov. Luis Fortuño. The process is currently being questioned in the courts. Law 82 of 2010 ordered Puerto Rico to generating 12 percent of all electricity with resources such as solar and wind by 2019. 

    Confusion Following Sunnova’s “Media Tour”
    The day after meeting with Rosselló, Sunnova’s chief executive officer, John Berger, appeared in Puerto Rican media, talking about bringing batteries to solve the lack of power among customers. But he overlooked a key detail: he did not say that there would be an additional cost. 

    As a result, Lydia Rosa, a Carolina resident with 30 Sunnova solar panels, believed that the batteries were going to be provided for free, because she thought that the company assumed the responsibility to fix the problem. 

    She wasn’t alone. “Many people called my office to complain that they needed a battery,” Pérez Vélez said, addressing the confusion created after Sunnova’s media tour. 

    The company had to clarify information with the media: customers had to pay for the batteries. 

    Rosa said that when she contacted the company to solve her problem, she was offered a 13.5 kilowatt hours (KWh) battery, at $100 per month, for 10 years. The energy storage device would never belong to her because, like the solar panels on her roof, Sunnova offers equipment only through leasing, a business model known as PPA (Power Purchase Agreement). Sunnova does not allow its customers to buy batteries at a better price from another supplier. 

    “Puerto Ricans were treated like idiots,” Rosa said. 

    So why is Sunnova offering batteries now? 

    “María’s impact made us change our business model to provide a solution to the customer so they are able to enjoy energy continuously. That’s when we made this market decision,” Zambrana told the CPI. 

    The CPI also asked Zambrana if the company had thought about this offer before Hurricane María. 

    “Yes. What Hurricane María did was speed up the time to bring the product,” she replied. Sunnova has been in Puerto Rico since 2012. 

    The hurricane also highlighted the tensions between PREPA and Sunnova, a company eager to expand its business and resolve confusion with customers. Rosselló’s latest executive order did not lead to a resolution, since PREPA did not expedite the process of connecting private equipment to the public electricity grid. 

    As of Dec. 1, the net metering system had 10,362 subscribers, the same as before the hurricane. PREPA’s slow response caused Sunnova to respond. The company’s management sent a letter (which it did not make public) to PREPA executive director Justo González and governing board, as well as to Rosselló, alleging the agency’s inaction and the reluctance to work with Sunnova. 

    “PREPA has not complied with the governor’s Executive Order, which unfortunately creates a situation that casts a shadow over PREPA’s efforts and commitment to expeditiously bring back power to its clients, and commitment to its obligations. Sunnova hereby requests a final and definitive date to complete this process,” Berger said in the statement. “The lack of power after three months, and the reluctance of PREPA to work with companies like ours, continues to hinder relief and recovery efforts on the island—to the detriment of local residents.” 

    PREPA’s executive director did not respond to several requests by the CPI for interviews to talk about this matter and other aspects related to renewable energy.

    Casa Pueblo’s solar energy turned the institution into a power hub for neighbors.
    Photo credit: Photos by the Center for Investigative Journalism

    Quality of Life in the Face of an Emergency
    In the remote sector of El Hoyo in Adjuntas, there is a three-feet wide cement path that leads to 25 modest homes built mainly of wood. In eight of the homes, Casa Pueblo has installed solar equipment that looks like a doll house. The equipment works well. There are two photovoltaic panels and a battery, with a 300-watt inverter, that connects to two light bulbs, a handheld radio and a mini-fridge. 

    A neighbor keeps two bottles of water in the mini-fridge, along with a snack and the insulin she needs to keep cold for her diabetic husband. In another house located on a hill, María Medina can now turn on the machine she needs to conduct her daily dialysis and address her kidney failure. She will no longer have to follow manual treatments, which is less effective than automated treatments. “For me, this has been an opportunity to get out of the crisis,” explained Medina, who got two additional panels from Casa Pueblo for the dialysis machine. “This was my Christmas present.” 

    Reducing Consumption
    For Puerto Rico to make the leap into energy sustainability, it must begin by reducing consumption and thinking about equipment that meets the most important needs, Orama told the CPI. 

    “These days you can mount solar panels with energy storage that is costing 20 cents per kilowatt hour, almost the same as what you are paying PREPA. We have to start talking to people again about the fact that there is equipment that provides, at the very least, quality of life in emergencies. That is much better than zero energy or a noisy power generator that harms the environment and makes you spend money and time standing in lines to buy gasoline,” said Orama, referring to alternative systems outside of Sunnova. 

    The emergency solar equipment that Casa Pueblo distributed costs about $1,800 and has been a salvation for the massive blackout caused by María. “We have to think about a system that serves us for the essentials, to gradually become independent from an oil-based system,” Massol added. 

    A few steps from Adjuntas’ town square, at Casa Pueblo’s headquarters, Massol walked into the location just as the power was beginning to be restored in the town. It had been more than three months since the hurricane hit on Sept. 20. He saw a neighbor asking for a hand lamp, which charges by leaving it in the sun all day. After seeing a Casa Pueblo employee supply the equipment, Massol pointed to a sign posted on the roof of the organization’s headquarters, which says: “Transforming the crisis with solar energy alternatives.” 

    That motto is not a fantasy, he told the CPI. “There is an energy option here that works perfectly. This environmental discourse is not a utopian message. It’s a practical message,” Massol said. 

    When Solar Energy Is More Expensive
    At the OIPC, Pérez Vélez reviews the importance of renewable energies and how poorly they have been implemented in Puerto Rico. 

    Many of the complaints to the OIPC are from consumers who paid about $300 to PREPA and after signing a contract with Sunnova to lower their bills, paid this Texas company up to $200 per month plus almost $200 to PREPA, for a total of $400. 

    “They went looking for something better and came back with worse,” Pérez Vélez said. 

    When consumers entered into leasing agreements for the photovoltaic panels with Sunnova, the panels were expected to produce about 1,500 kilowatts. They ultimately generated half of that. “Because the panels generate less than the customer needs, the equipment is interconnected with PREPA to buy electricity. You will never pay only the $3 to PREPA that they promised you. It will always be more,” he explained. 

    Sunnova said it cannot guarantee customers that they will only pay the PREPA the estimated $3. “PREPA’s bill for each client depends on the amount of energy used in the network after the production of solar energy has been discounted,” the company said in a statement. 

    The CPI confirmed that at least one company, Alpha Solar, sells Sunnova contracts, so sometimes customers are doing business with Sunnova without knowing it. After signing an energy purchase agreement, the companies that install Sunnova equipment are Windmar Home, New Energy, Pure Energy, Integrated Solar Operations and Mel Pro. 

    Sunnova arrived in Puerto Rico six years ago, when the cost of PREPA’s energy was quite expensive, at about 28 cents per kilowatt hour (kWh). It tried to compete with PREPA by implementing a cost of almost 20 cents per kWh. But that was not going to last long. 

    “The company knew that the cost of PREPA’s kilowatt hour was not going to stay that high. The people of Puerto Rico could not continue paying those amounts,” Pérez Vélez added. 

    Batista pays 19 cents per kWh to Sunnova, plus 21 cents per kWh to PREPA. When the cost of the public corporation’s energy fell to 17 cents per kWh in 2016, Sunnova’s cost remained higher. She always paid two high bills, with different collection criteria—and she always paid more than what she was promised. 

    The OIPC considers Sunnova contracts as burdensome. For instance, the contracts do not permit disputes in local Puerto Rican courts. All disputes go through an arbitration process in Texas, which consumers themselves have to pay, according to Pérez Vélez. 

    Of the complaints filed with the OIPC before the hurricane, 300 became formal complaints before the Energy Commission (EC), which oversees the island’s public energy policy and investigates these issues.

    “Now we have to add a new factor to the investigation: seeing what the customer’s expectation is when a contract is signed and if the expectation was to have only clean energy or to have sustainability when the grid collapsed,” said José Román, interim president of the EC. The investigation is looking into if, according to customers’ energy expectations, Sunnova now has to provide the battery service free of charge, added Román. 

    As for the town of Adjuntas and Casa Pueblo? Despite costly solar equipment, many know that their strategy can lead the island to energy independence. For example, when the entire town was in darkness, a group of neighbors went to a community cinema powered by solar energy, as they did on Dec. 23 to watch a documentary. And that Casa Pueblo can send a cable to power the radio station’s cabins, which are behind the house, as they did after Hurricane María. The organization has already distributed almost 10,000 solar lamps. At night, in the darkness of the mountains, you can see the lights moving.

    This story from Puerto Rico's Center for Investigative Journalism was made possible as part of a collaboration with the Futuro Media Group, supported by the Ford Foundation. English Version by Michelle Kantrow and Julio Ricardo Varela. Leer in Español