Puerto Rico’s diverse range of industrial and commercial facilities suffered hugely after last year’s Hurricanes Irma and Maria, which together knocked out the island population’s power supply, plunging 2.3 million people into darkness.
Many companies from a variety of industries, ranging from pharmaceuticals to electronics, run manufacturing operations in Puerto Rico. These organisations take advantage of the existing infrastructure and the tax benefits offered by the government, but loss of power can have a major impact on their operations.
For some pharmaceutical facilities, loss of power for as little as ten minutes can interrupt the complex processes and result in the need to dispose of $1 to $2 million worth of product. This type of risk, as well as the instability of the local utility Puerto Rico Power Authority (PREPA), is driving the islanders to look towards microgrids to enhance resilience and reliability.
This is not a new idea. Industrial customers have contemplated creating their own power supplies in the past, but the cost of fuel coupled with the equipment installation resulted in prices comparable to those supplied by PREPA. Technology gains in solar generation, wind generation and energy storage technologies have closed the gap in capital requirements relative to traditional fossil fuel plants. At the same time, world market liquid gas prices remain attractive.
Shift from cost driven decision-making
Given the recent events, there has been a shift in mindset. The purely cost driven decision is no longer valid. Reliability and redundancy now play a major part in the decision-making process, opening up a huge opportunity for microgrids in Puerto Rico.
These microgrids can provide much more than electricity. The use of combined heat and power engines could provide a supply of waste heat that can be used for processes requiring steam, hot water, or even chilled water, something that is in high demand on the island.
Global IV bag shortage
Puerto Rico’s pharmaceutical industry is a global supplier. When production of IV bags stopped as a result of the power interruptions, the whole world felt the impact. The effect of the shortage of this commonly used product was multiplied due to a particularly bad flu season, with dehydrated patients being hospitalized and in need of IV bags for treatment.
In this world of just-in-time manufacturing, even a minor disturbance can quickly cause issues. This is only one example of the importance of a reliable and resilient power supply for Puerto Rico’s industries and the end customers. Similar issues have been encountered in Puerto Rico’s aerospace, electronics and other industries.
Tailoring solutions to the customers’ needs
As the largest operator of district energy systems, Veolia is well positioned to supply the microgrids to power Puerto Rico’s commercial and industrial sector. We work with the customer to identify their district energy and microgrid requirements, and come up with a unique solution that can be implemented using our numerous existing relationships with equipment suppliers. As a result, we are not constrained by pre-determined solutions or particular technologies.
As with any major project, permits and permissions will be a challenge. In Puerto Rico’s disrupted energy market, it is vital to speak the language of the regulatory authorities, clearly communicating what will be built and why. Veolia’s employees are experienced in this arena, with a deep understanding of the thought processes and requirements of an electric utility. We can engage at the right levels to secure permits.
Veolia’s vision is to be a long-term partner on the island for the provision of microgrid solutions. Not only supplying and installing the equipment, but also operating and maintaining for the next 20 to 30 years. To underscore Veolia’s commitment, I will soon be moving with my family to the island to help develop sustainable, reliable and affordable energy solutions for Puerto Rico.