Even a marginal rise in power bills could mean hardship in Puerto Rico, where the median household income is around $26,000 a year, less than one-third of the U.S. median. Already, the island faces some of the highest electricity prices in the U.S.
Faraway energy shocks have caused prices to climb in Puerto Rico before. After Russia’s 2022 invasion of Ukraine sent oil and gas markets reeling, the fuel-cost portion of Puerto Ricans’ electric rates jumped from 15 cents per kilowatt-hour at the beginning of that year to 22 cents per kilowatt-hour in the summer, according to Kunkel. That price jump, she noted, was driven by higher prices for both LNG and oil.
To some, the latest threat of price hikes underscores once again the need to embrace solar, wind, and batteries — all of which produce power unperturbed by global conflict.
Utility-scale renewables provide very little of Puerto Rico’s electricity today. But devastating hurricanes and frequent outages have motivated many Puerto Ricans to install rooftop solar and home batteries in recent years.
In 2023, the Biden administration launched a $1 billion program to boost the buildout of these distributed systems. The Trump administration, however, has clawed back or redirected much of that federal funding. Meanwhile, Jenniffer González-Colón, the Trump-allied governor of Puerto Rico elected in 2024, has supported plans to boost the island’s gas generation and weakened a 2019 law that commits it to ditching fossil fuels by 2050.
In late 2024, the Puerto Rican government approved the construction of a new gas plant on the island, and it’s currently looking to procure another 3 gigawatts of “firm” capacity, which likely means gas plants. Contracts for temporary generators run by LNG and diesel are also advancing, Kunkel said.
“I think the government’s making a huge mistake doubling down on natural gas as opposed to investing more in renewables,” said Sergio Marxuach, policy director at the Center for a New Economy, a Puerto Rican think tank.
In light of that, the island should work “as hard as possible” to insulate its economy from fossil fuels, said Tyson Slocum, director of the energy program at Public Citizen, a nonprofit consumer advocacy group.
“I don’t care what kind of supply agreement you negotiate. I don’t care if you’re getting your LNG from the United States,” Slocum said. “You are going to continue to be vulnerable to shortages and price shocks because of the inherent features of global fossil-fuel supply chains.”
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