In a press release last month, Puerto Rico’s Governor Jenniffer González-Colón (R) said the islands’ most urgent issue is energy security, stating, “This Administration clearly understands the urgency of the crisis and is utilizing available, existing emergency authorities to put words into action.”
This should come as no surprise, given Puerto Rico has had two major power outages over the past four months and has consistently dealt with energy issues since the Puerto Rico Electric Power Authority went bankrupt in 2017. Today, Puerto Ricans pay twice as much for electricity as the average American citizen. One of the many contributing factors to its long-standing energy crisis has been its status as a territory.
Because Puerto Rico lacks full-fledged statehood status, the islands have been missing out on critical infrastructure funding that could be used to repair its outdated power grid and rebuild after natural disasters. Currently, federal law allocates funding to states and territories differently. For example, while states get the benefit of receiving amounts proportional to their population size and need, territories are often left with a fixed amount of money from smaller, designated pools. Because of that, every time a disaster occurs on the islands, Congress must manually override dozens of funding formulas just to get basic aid where it needs to be.
This has greatly impacted the islands’ ability to respond to crises, maintain their energy resources, and sustain themselves for the long term. In May of 2023, a study from the University of Puerto Rico found that the islands’ lack of statehood status has locked it out of up to $6 billion in federal funds annually. While statehood is not the only path towards additional federal support, without guaranteed equal access to funding, Puerto Rico has had to endure an added layer of unnecessary bureaucracy, which has only hindered its ability to rebuild following disasters.
Additional federal support is critical for supporting the islands’ future. That’s because funding isn’t solely needed for disaster relief, but is also necessary for building reliable, long-term energy sources on the islands. In February of 2024, the Department of Energy and FEMA reported that with full funding, Puerto Rico could reach 100% renewable and clean energy by 2050. That would include a variety of technologies such as solar microgrids, wind farms, hardened power lines, and buried cables, allowing the islands to recover quickly after disasters and create more economic opportunity in the region.
Whether the answer eventually comes through statehood or not, it’s clear that in order for Puerto Rico to meet its energy needs, the islands will need extensive federal support to overcome its persistent struggles.
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Ricardo: you see statehood as the potential source for federal funds. But even as a colony which does not pay federal taxes Puerto Rico can not attract investments. If statehood were granted even the foreign firms would leave. So, Puerto Rico has always depended on a special legislation like the 936 we once had to allow external investments. This is a paradox. Research how to secure investments under both formulas.