LUMA Energy
LUMA Energy is a private power company that is responsible for power distribution and power transmission in the Commonwealth of Puerto Rico. It is also in charge of maintaining and modernizing the power infrastructure. Previously, these duties belonged exclusively to the Puerto Rico Electric Power Authority, but as of July 20, 2018, permission was granted for PREPA assets and service duties to be sold to private companies, and on June 22, 2020, a 15-year contract with LUMA was signed, making LUMA the new operator. The takeover occurred on June 1, 2021.
Infrastructure and power grid
Following Hurricane Maria in 2017, which exposed longstanding weaknesses in Puerto Rico’s electric grid under PREPA, the government contracted LUMA Energy, a private consortium, in 2021 to manage electricity transmission and distribution.After taking over operations, LUMA launched several infrastructure repair and upgrade initiatives. These included replacing over 17,000 utility poles and clearing vegetation along thousands of miles of power lines. To improve resilience, the company installed more than 17,850 hurricane-resistant poles and upgraded over 1,800 poles and critical distribution breakers.
As part of broader grid modernization efforts, LUMA submitted 460 projects for Federal Emergency Management Agency funding, with 144 projects underway. FEMA has approved funding for eight major substation projects. LUMA plans to prioritize substation and transmission work, implement preventive maintenance, and inspect 51 key transmission segments in fiscal year 2025. The company also aims to clear vegetation along 16,000 miles of power lines over four years.
To enhance monitoring and efficiency, LUMA intends to add battery storage systems and replace 1.5 million electricity meters with smart meters over three years. In alignment with Puerto Rico’s energy policy, the company is developing nearly 1 GW of renewable energy and over 700 MW of storage, including nine renewable energy interconnection points. LUMA has connected solar systems for 12,000 customers, added 50 MW of renewable capacity, and introduced a resource map for solar development.
LUMA has overseen power restoration following severe weather events such as Hurricane Fiona in 2022 and Tropical Storm Ernesto in 2024. The company has emphasized its ongoing efforts to improve grid reliability and has reached an agreement with the electrical workers’ union to support workforce development through technical training programs.
In an August 2025 TV news interview, LUMA executives described Puerto Rico’s electrical grid as “a very old system” that had been “neglected for decades” prior to the company assuming operations. The company said that reconstruction has been slowed down by insufficient and delayed federal funding, saying that the release of billions of dollars in FEMA funds has not kept pace with the work required. LUMA said that even with full resources, restoring the grid to reliable condition would take an estimated five to ten years.
History
LUMA Energy was contracted to repair and modernize Puerto Rico’s electrical grid. The company has stated that the grid was outdated and poorly maintained, and that limited funding and delays in Federal Emergency Management Agency disbursements have hindered progress. The Puerto Rico Energy Bureau is reviewing LUMA’s proposed rate increases intended to raise additional funds. According to a LUMA official, electric service has improved since the company assumed control, and the company is prepared for hurricane impacts. LUMA estimates that completing necessary repairs would require five to ten years with adequate resources. The Governor of Puerto Rico has criticized LUMA’s performance and threatened to cancel its contract. LUMA has said it remains committed to its work.2020-2021
Registered on January 17, 2020, as LUMA Energy ManageCo, LLC, the company was renamed LUMA Energy, LLC on June 12, 2020. A joint venture between Quanta Services and ATCO, LUMA was created to manage Puerto Rico’s power grid.The contract under which LUMA Energy operates the power grid in Puerto Rico was signed after a bid in 2020. In the bid, five different companies participated and only four submitted business proposals. The $1.5 billion contract is set to last for 15 years and can be renewed if both parties agree.
LUMA Energy officially became the new operator for Puerto Rico's power grid on June 1, 2021. LUMA is in charge of operating the distribution and transmission infrastructure, although they do not own it, nor do they own or operate the power generation sector. The takeover happened as part of an agreement with Puerto Rico's Public-Private Partnership Agreement in an effort to overcome PREPA's bankruptcy.
2022-2025
On June 1, 2022, LUMA Energy completed its first year of operations in Puerto Rico, reporting changes in customer service, reliability, and progress on FEMA-funded projects. In November 2023, it hosted the IEEE Power and Energy Society conference in San Juan, the first time the event was held in Puerto Rico.In February 2025, LUMA announced plans to add nearly 1 GW of renewable energy and over 700 MW of storage, attracting $4 billion in private investment. That same month, the company reached an agreement with Linxon US LLC and AtkinsRéalis Caribe to build nine energy interconnection points, adding 990 MW of clean energy and 700 MW of storage to the grid.
Despite these developments, LUMA continues to face challenges, including energy supply issues.
In 2022, a senior official with LUMA testified before a U.S. House oversight hearing investigating Puerto Rico's power grid development and its post-disaster reconstruction. Amid criticism by some officials in Puerto Rico, such as energy czar Josué Colón Ortiz, the LUMA official stated that since assuming responsibility in 2021, LUMA has worked to enhance reliability and resiliency despite inheriting a grid weakened by years of neglect. In her testimony, she described LUMA’s response to Hurricane Fiona, noting that power was restored to 90 percent of customers within 12 days. She credited the company’s emergency operations center, the mobilization of 1,300 field workers, and a $130 million inventory of materials for supporting rapid recovery efforts. Addressing electricity rates, Bahramirad stated that LUMA has never proposed an increase to the base rate for T&D operations, attributing past rate hikes to rising fuel costs managed by PREPA. She also outlined efforts to reduce outages through vegetation management, improved customer service, and faster response times.
LUMA has advanced over 250 FEMA-funded infrastructure projects, representing more than $6 billion in federal investment, with 23 projects already under construction. The company is also collaborating with FEMA and other agencies to strengthen power generation.
On April 16, 2025, a transmission failure caused a blackout across Puerto Rico, cutting power to 1.4 million customers and water to over 400,000. Likely due to vegetation interference and equipment faults, the outage shut down all power plants and disrupted hospitals, airports, and other services. The incident caused traffic jams, business closures, and renewed criticism of grid operators LUMA Energy and Genera PR.
Renewable energy
On February 6, 2025, LUMA Energy announced plans to expand Puerto Rico’s electric grid with nearly 1 gigawatt of renewable energy and over 700 megawatts of energy storage. The project involves more than $4 billion in private investment and is expected to generate approximately 4,200 construction jobs and 139 permanent positions.As part of Puerto Rico’s Tranche 1 renewable energy procurement, LUMA partnered with Linxon US to develop nine energy interconnection points to help integrate new renewable sources into the grid. The initiative supports Puerto Rico’s energy transition goals, including ending coal-fired electricity generation by 2028 and achieving a fully renewable energy grid by 2050.
Since taking over grid operations, LUMA has connected solar panel systems for 12,000 customers, adding 50 MW of solar capacity to the system.
Grid reliability and service stability
LUMA Energy has undertaken several initiatives to improve Puerto Rico’s electrical grid. The company has replaced over 17,000 utility poles and cleared vegetation along approximately 4,800 miles of power lines and related infrastructure. It has also added thousands of automation devices as part of its grid modernization efforts.In fiscal year 2025, LUMA plans to inspect 51 line segments identified as contributing to a significant portion of transmission-related outages. Over the next four years, it aims to clear vegetation from 16,000 miles of power lines. Of the 460 grid reconstruction projects submitted to the Federal Emergency Management Agency, 144 are currently under construction.
LUMA intends to install additional battery energy storage systems and replace 1.5 million meters with smart meters within three years to improve detection of power losses. On February 6, 2025, the company announced plans to add nearly 1 gigawatt of renewable energy and over 700 megawatts of energy storage to enhance grid reliability. An agreement is in place to develop nine interconnection points to support renewable energy integration.
Despite these efforts, outages persist. In December 2024, a blackout affected over 1.2 million residents. Following Hurricane Fiona in September 2022, over 100,000 customers remained without power for two weeks. By October 2, 2022, LUMA reported restoring service to about 1.34 million customers. After Tropical Storm Ernesto in August 2024, tens of thousands were still without power a week later, though officials stated that 96% of the population had service within three days.
LUMA executives have acknowledged ongoing challenges, with a high rate of critical failures reported. CEO Juan Saca stated that over 95% of customers had continuous service more than 98% of the time, when power generation was available.