A former energy official for Obama explains why Tesla has the best plan for helping Puerto Rico
About 84% of the island is without electricity, critical structures like hospitals are relying on gas- and diesel-powered generators to remain operational, and the prognosis looks bleak for most residents. It could be another six months before parts of the island regain power.
It's a dire situation that should inspire the federal government to seriously pursue the construction of microgrids - which has been pitched as the best solution to Puerto Rico's long-standing energy issues before the hurricane even struck, Brandon Hurlbut, the chief of staff for the Department of Energy under President Barack Obama, said in an interview.
Microgrids use batteries to store renewable energy generated by solar or wind farms, which is then converted into electricity. The systems are more reliable because they can operate independently of the main power grid, making them less vulnerable to power outages.
It's a system that has been popularized by Tesla, which has deployed battery and solar projects in 18 countries, from Australia to the USA. Tesla CEO Elon Musk is now in talks with Puerto Rico Governor Ricardo Rossello about constructing microgrids on the island using solar panels and commercial batteries called Powerpacks.
"I really would just like to see them use this opportunity," Hurlbut said. "Puerto Rico could be a real shining example of a modern electricity system."
'The least innovative utility'
He served as an energy representative for President Barack Obama's Puerto Rico Task Force, which was tasked with restructuring Puerto Rico's $72 billion in debt. That task force ultimately composed Promesa, a bill signed into law by Congress in 2016 that put the island's finances under direct federal control, similar to what occurred when Detroit filed for bankruptcy.
As Hurlbut puts it, the issues plaguing Puerto Rico's electric company, PREPA, are symptomatic of the Commonwealth's debt crisis. PREPA was insolvent before the hurricane even hit, with $9 billion in debt.
PREPA has long passed up opportunities to modernize its aging electrical infrastructure, saying it didn't have the funds. But the utility has also been mired in corruption allegations, including that it overcharged consumers for oil.
Puerto Ricans have felt the ramifications of PREPA's financial choices; residents have paid astronomically high utility bills only to suffer through power outages that are four times more frequent than the rest of the US on average.
"They were the least innovative utility I had ever seen in my life," Hurlbut said. "When I was at the DOE, 70% of their electricity was generated by importing oil. That was down to about 50% recently. But still, that's absurd."
The task force encouraged the local government to impose regulations on PREPA and encourage a transition to renewable energy. The move would decrease Puerto Rico's reliance on an aging, oil-dependent power grid. In return, Puerto Ricans would have more reliable electricity at cheaper rates.
Hurlbut said the hope was to replicate the DOE's Integrated Deployment project in Hawaii, which has helped utilities implement microgrids with the ultimate goal of drawing 100% of their electricity from renewable energy by 2045.
Tesla has played a role in aiding Hawaii's green energy transition. The company partnered with the Kauai Island Utility Cooperative and installed a microgrid in March that is expected to reduce fossil fuel use by approximately 1.6 million gallons per year.
"We wanted to do that with Puerto Rico but there are certain things that have to happen," Hurlbut said. "If you can't regulate the utility then you have no leverage to help them make this transition."
The power of Elon Musk
Such a solution wouldn't just benefit Puerto Rico in the long run, but could help restore power at a much faster rate, Hurlbut said. Tesla set up a massive battery storage system in Mira Loma in just 88 days; it's scheduled to construct an even bigger system in South Australia in 100 days.
"You could do it now because the federal government has so much leverage right now," Hurlbut said. "Puerto Rico needs the federal government not only for the storm but for its general finances."
Hurlbut said he would like to see the federal government use resources at the Department of Energy to pursue a clean energy solution, but acknowledges it's unlikely. EPA Chief Scott Pruitt officially reversed Obama's Clean Power Plan this week.
But Musk appears to have the unique ability to cut through the red tape and pursue a microgrid solution, which seems like the best bet.
Rossello spoke with Musk just one day after the Tesla CEO said microgrids could solve Puerto Rico's electric crisis. That kind of public sway shouldn't be overlooked.
At a time where Washington seems unwilling to consider alternative solutions, Tesla could be the best bet for executing a clean energy solution that officials have long said is necessary.
"If you really pulled together enough resources and make it a priority, they could do this right," Hurlbut said.