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Rebuilding, hardening Puerto Rico electric grid estimated to cost more than $17B

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Rebuilding, hardening Puerto Rico electric grid estimated to cost more than $17B

Rebuilding Puerto Rico's electric grid to withstand future storms would cost an estimated $17.61 billion, according to a working group that drew from hurricane experiences on the mainland U.S. to draft a recovery plan for an island that was already struggling through a financial crisis when a pair of devastating storms blew through in September.

The assessment from the Puerto Rico Energy Resiliency Working Group was released Dec. 11, nearly three months after hurricanes Irma and Maria wrecked the territory's power system and led to the longest blackout in U.S. history. Among other measures, the group recommended reinforcing utility poles, undergrounding some power lines and using modern control systems to integrate distributed energy resources to create a cleaner, more efficient grid capable of sustaining 155 mile-per-hour winds and heavy flooding.

The undertaking would depend on funding from the Federal Emergency Management Agency, community development block grants, insurance reimbursements and private-sector investment, said the group, which includes the New York Power Authority, the Puerto Rico Electric Power Authority, the U.S. Department of Energy and a handful of national laboratories.

"In the aftermath of Superstorm Sandy in New York, a plan was immediately put into place to harden and enhance the power grid to ensure storms would not damage our communities in the future — and now is the time to implement a similar plan to ensure these upgrades are also completed in Puerto Rico," New York Gov. Andrew Cuomo said in a news release.

Energy experts for months have talked about the opportunity to build a reimagined grid on top of the ruins of Puerto Rico's old system. Companies rushed in with batteries and solar panels for hospitals and homeowners who could afford them. But the real challenge is financing large-scale infrastructure projects in on island where the government and municipal utility are insolvent.

"It may not [have] been the best business decision coming to work for a bankrupt island," Whitefish Energy Holdings LLC CEO Andy Techmanski told CNN after his company had trouble getting paid for work it did on Puerto Rico. The $300 million contract Puerto Rico signed with Whitefish was canceled amid congressional scrutiny.

Given Puerto Rico's battered financial state, rebuilding hinges on support from the federal government. Under the Stafford Act, Congress can provide storm recovery funding through FEMA; however, spending is limited to projects that restore infrastructure to the state it was in before a disaster.

DOE Undersecretary Mark Menezes recently said the Trump administration has "short-circuited" the Stafford Act by pursuing a rebuilding strategy to make Puerto Rico's grid more resilient.

"We probably won't rebuild the energy infrastructure grid itself," such as a major transmission line that was in the path of Hurricane Maria, Menezes said at a forum in Washington, D.C., in late November that was hosted by the Consumer Energy Alliance. Instead, the federal government is "likely to model microgrids" on parts of the island where there are major employers, for example, "so that we can build a more resilient grid."

"When you go to our labs, you see technological innovations that might eliminate the need for a lot of the infrastructure that we see today," Menezes added. "I mean, we accept these interstate [transmission] lines as the way it's always been. … But why does that have to be the way it is?"

Rebuilding a more resilient system "will encourage [distributed energy resource] technology providers to showcase their products and systems for global acceptance of such systems and set a model for the industry while promoting private investments in the use of renewables for a low carbon future," the Puerto Rico Energy Resiliency Working Group said.

So far, though, it is unclear how much of the system, if any, is being rebuilt to withstand a Category 4 hurricane, the group said. Initial work is focused on repairing salvageable substation and communications equipment, strengthening utility poles and restoring physical security.

The DOE is working with the National Oceanic and Atmospheric Administration to model wind and solar patterns so that assets are placed in optimal locations, and it is using rainfall and storm surge modeling to avoid putting substations in flood-prone areas, Menezes said.

The working group's cost estimate includes approximately $9.57 billion for overhead transmission and distribution infrastructure, $3.12 billion for power generation assets and $1.46 billion for distributed energy resources. While repairs to the distribution system could be completed during the next year, more complex projects, such as rebuilding transmission infrastructure and substations, could take seven to 10 years to complete, the group said.