PUERTO RICO · POWER UTILITY
Key Facts
- Who Governor Jenniffer González and the federal board that oversees Puerto Rico’s budget.
- The ask A sales tax break on prepared food in November and December to offset higher power costs.
- The utility PREPA, the island’s state power company, has been in bankruptcy court since 2017.
- The debt The board put PREPA’s total debt above US$9 billion in February 2025.
- Next step The board has questioned the request in a letter; a final decision is still pending.
Puerto Rico’s governor is asking the federal board that controls the island’s budget to approve power bill relief. The request comes as the island’s state power company, PREPA, is still in bankruptcy court with more than US$9 billion in debt.
For US readers, the dispute touches the value of PREPA bonds and the cost and reliability of electricity in a US territory. Our earlier reports on the island’s gas supply and on Senate relief plans show the pressure.
Governor Asks for Power Bill Relief
By Friday 23 October 2026, Governor Jenniffer González had asked the board to validate a temporary tax break on prepared food for November and December. She says the aim is to ease the strain of rising electricity costs.
The tax is the island’s sales and use tax, known by its Spanish initials IVU. If the board validates the exemption, the Treasury Secretary could put it into force through an administrative order.
The governor also criticized LUMA Energy, the private company that runs the island’s power lines, for falling short of expectations. She again asked for explanations of the island-wide blackouts of 31 December 2024 and 16 April 2025.
The Board and Its 2025 Plan for PREPA
The Financial Oversight and Management Board was created by the US Congress in 2016 to fix Puerto Rico’s public finances. It represents PREPA in the bankruptcy case that began in 2017.
In February 2025 the board certified a new fiscal plan for PREPA, as a federal judge had requested. Its executive director, Robert Mujica, said the plan included no rate increases.
Mujica called the bondholders’ demand for US$8.5 billion impossible and said the government could offer them US$2.6 billion. The governor’s administration complained that the board had not shared the plan before certifying it.
In Plain English, Who Is Who
PREPA, known in Spanish as AEE, is Puerto Rico’s state-owned electric utility. Bondholders are the investors who lent it money and now wait to be repaid.
LUMA Energy is the private company that runs the transmission and distribution lines. A fiscal plan is the board’s certified budget path for a public body, and it limits what the government can spend.
What It Means for You
If you hold PREPA bonds, or funds that do, the key question is how much creditors will be paid and who funds it. The board’s 2025 position was that no rate increase should pay for the offer.
If you live in or visit the island, the dispute is a reminder that power prices and blackouts remain a political fight. For the wider picture, see our guide to who runs Puerto Rico’s economy.
What Is Not Known
It is not known whether the board will validate the tax break or how much it would cost. On 28 October 2026 the board’s executive director, Robert Mujica, sent a letter questioning the proposal, saying it addresses a symptom but not the cause of high power costs; a final decision has not been confirmed.
It is also not known when a deal with PREPA’s bondholders could be reached. The final size of any rate change has not been decided.
More: Latin America news in English, every day from The Rio Times.
Frequently Asked Questions
What Is PREPA?
PREPA is Puerto Rico’s state-owned electric utility, known in Spanish as AEE. It has been in bankruptcy court since 2017.
What Did the Governor Ask For?
She asked the federal oversight board to validate a temporary sales tax break on prepared food for November and December. The aim is to ease high electricity costs.
How Much Does PREPA Owe?
The board said in February 2025 that PREPA’s total debt exceeds US$9 billion. Bondholders had demanded US$8.5 billion, while the board said the government could offer US$2.6 billion.
Who Is the Oversight Board?
It is a federal board created by Congress in 2016 under a law called PROMESA. It must approve Puerto Rico’s budgets and major fiscal decisions.
Sources: Government of Puerto Rico, request to the Financial Oversight and Management Board on a prepared-food sales tax exemption, 23 October 2026; Financial Oversight and Management Board for Puerto Rico, certified PREPA fiscal plan and statements by Robert Mujica, 11 February 2025; US Bankruptcy Court for the District of Puerto Rico, PREPA Title III case, since 2017.
Correction — 5 November 2026: an earlier version said the board had not answered; on 28 October 2026 it questioned the proposal in a letter to the governor.
This article was produced by The Rio Times’ automated AI newsroom. Editorial responsibility: Matthias Camenzind, Publisher and Editor-in-Chief. The Rio Times also runs Ask Rio Times, which answers from 100,000+ of our own articles, the daily Latin America Power Map, and prediction-market odds on elections and markets.. How we use AI · Report an error