Umair Gaines
Puerto Rico has a history of problems with its electricity supply, with the island suffering extensive power grid issues since Hurricane Maria in 2017. In 2024, Puerto Rico had the second-most expensive residential electricity rates in the United States, at about 22 cents per kilowatt-hour. The island relies heavily on fossil fuel-fired power plants to generate most of its electricity, with petroleum products accounting for about three-fifths of its total energy consumption. In 2025, the island suffered a massive blackout, leaving 1.4 million customers without power.
| Characteristics | Values |
|---|---|
| Average electricity price rank | Fourth-highest compared to U.S. states |
| Residential electricity rates | 22 cents per kilowatt-hour |
| Electricity generation capacity by source | Petroleum-fired power plants (62%), natural gas (24%), coal (8%), renewables (7%) |
| Electricity consumption by sector | Commercial (47%), residential (43%), industrial (10%) |
| History of electricity infrastructure damage | Yes, due to hurricanes, earthquakes, and other factors |
| Goals for renewable energy | 100% by 2050, with interim targets of 40% by 2025 and 60% by 2040 |
| Privatization of the electricity sector | Partially privatized, with private entities managing, operating, and maintaining infrastructure |
| Recent blackouts | April 2025, New Year's Eve 2024 |
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What You'll Learn
- Puerto Rico has the second-highest residential electricity rates in the US
- The island's electricity is mostly generated by fossil fuel-fired power plants
- Hurricanes and earthquakes have damaged Puerto Rico's electricity infrastructure
- The Puerto Rico Energy Bureau approved a rate increase of 2.2 cents per kilowatt-hour
- Rooftop solar and microgrids are more affordable than traditional electricity
Puerto Rico has the second-highest residential electricity rates in the US
The high cost of electricity in Puerto Rico has been a source of concern for residents, especially given the territory's history of problems with its electricity supply. The island has experienced several major blackouts in recent years, including one in September 2022, when Hurricane Fiona knocked out 100% of the grid in some parts of Puerto Rico for up to four weeks. In addition, in April 2025, an island-wide blackout left 1.4 million customers without power, causing significant disruptions to transportation, hospitals, and businesses.
The Puerto Rico Energy Bureau has come under criticism for its handling of the territory's energy challenges. In January 2025, the Energy Bureau approved an increase of 2.2 cents per kilowatt-hour for residential customers, resulting in a nearly $20 jump in electric bills for the average household. This decision came at a time when residents were already facing higher electricity costs due to the privatization of parts of the Puerto Rico Electric Power Authority (PREPA).
To address the issues of high electricity costs and unreliable supply, there have been efforts to increase the use of renewable energy sources in Puerto Rico. In 2019, the Puerto Rico legislature passed the Puerto Rico Energy Public Policy Act (Act 17), setting a goal for the territory to meet 100% of its electricity needs with renewable energy by 2050. However, progress toward this goal has been slow, and the island continues to struggle with building a more stable electrical grid.
The US Department of Energy (DOE) has been providing support to Puerto Rico in its energy recovery efforts since the hurricanes in 2017. The DOE has offered tools, training, and modeling support to enable the planning and operation of the electric system with greater resilience against disruptions. Additionally, rooftop solar and microgrids have been promoted as more affordable and reliable alternatives to the centralized fossil fuel and solar farm models.
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The island's electricity is mostly generated by fossil fuel-fired power plants
Puerto Rico's electricity is mostly generated by fossil fuel-fired power plants. In 2024, fossil fuel-fired power plants provided 93% of Puerto Rico's electricity-generating capacity. The island has a higher average electricity price than all but three U.S. states. This is due to its heavy reliance on imported fossil fuels, particularly petroleum products, which account for about three-fifths of its total energy consumption.
Petroleum-fired power plants provided 62% of Puerto Rico's electricity generation capacity in 2024, followed by natural gas at 24%, coal at 8%, and renewables at 7%. By comparison, less than 1% of the electricity generated in the 50 U.S. states is provided by petroleum. Puerto Rico's per capita petroleum consumption is about half the U.S. average, and its natural gas consumption is about one-fourth of the average of the 50 states.
The Puerto Rico Electric Power Authority (PREPA), the island's publicly owned power utility, serves about 1.5 million customers and is one of the largest electric utilities in the United States by customer base. However, on a per-customer basis, PREPA provides less than half as much power as similar-sized mainland utilities. PREPA has been exploring the use of natural gas-fired power plants and renewable energy with battery storage technology to provide a more reliable electricity supply.
Puerto Rico has no proven reserves or production of fossil fuels, coal, or natural gas. The island's natural gas is imported in the form of liquefied natural gas (LNG) from countries like Trinidad and Tobago, Nigeria, Norway, Spain, and Egypt. LNG imports have increased since 2012 to support PREPA's conversion of petroleum-fired power plants to dual-fuel capability with natural gas. In 2023, LNG imports reached a new high of 82 billion cubic feet.
While Puerto Rico has some renewable resources in the form of solar, wind, hydropower, and biomass, the island has been slow to adopt these sources. In 2019, the Puerto Rico legislature passed the Puerto Rico Energy Public Policy Act (Act 17), setting a goal for the island to meet 100% of its electricity needs with renewable energy by 2050. However, progress toward this target has been slow, and hurricanes and earthquakes have continued to cause disruptions to the island's electricity infrastructure.
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Hurricanes and earthquakes have damaged Puerto Rico's electricity infrastructure
Puerto Rico has been plagued by power outages for years, with its electricity infrastructure suffering damage from hurricanes and earthquakes. The territory's electrical issues are compounded by its reliance on fossil fuels, particularly petroleum, for electricity generation. In 2024, petroleum-fired power plants provided 62% of Puerto Rico's electricity generation capacity, with natural gas contributing 24%, coal 8%, and renewables only 7%. This is in stark contrast to the United States, where less than 1% of electricity is generated from petroleum.
The Caribbean hurricane season, which runs from June to November, often brings destructive storms to Puerto Rico. In September 2017, Hurricanes Irma and Maria caused the collapse of most of the island's transmission and distribution system, resulting in one of the longest blackouts in US history. The impact of these hurricanes left some residents without electricity for almost a year and caused severe disruptions to critical sectors such as communications, water, transportation, and healthcare. In 2022, Hurricane Fiona struck Puerto Rico, causing further damage to its electric grid and another island-wide blackout.
In January 2020, Puerto Rico was hit by a 6.4-magnitude earthquake that significantly damaged its two largest power plants, Costa Sur and EcoEléctric. These power plants primarily used natural gas for electricity generation, and their loss shifted the island's power supply towards a heavier reliance on petroleum. The earthquakes caused widespread power outages, affecting approximately 900,000 of Puerto Rico's 1.5 million customers.
The vulnerability of Puerto Rico's electricity infrastructure to natural disasters highlights the need for more resilient and sustainable energy solutions. The Puerto Rico Energy Public Policy Act (Act 17), passed in 2019, sets ambitious goals for the island to meet all its electricity needs with renewable energy by 2050. The US Department of Energy (DOE) has also been providing support to Puerto Rico's energy system stakeholders to enhance the resilience of the electric system against future disruptions.
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The Puerto Rico Energy Bureau approved a rate increase of 2.2 cents per kilowatt-hour
Puerto Rico has a higher average electricity price than almost all US states. Petroleum-fired power plants provided 62% of the country's electricity generation capacity in 2023, with natural gas, coal, and renewables accounting for 24%, 8%, and 7% respectively. The country's per capita electricity consumption is less than half that of the 50 US states.
In 2021, the Puerto Rico Energy Bureau approved a rate increase of 2.2 cents per kilowatt-hour. This decision came after the rejection of the Electric Power Authority's (PREPA) proposal for an adjustment of 2.14 cents per kilowatt-hour. The approved adjustment for the April-June quarter was 1.53 cents per kilowatt-hour, which is 0.61 cents lower than the original proposal.
The rate increase was implemented to address variations in fuel costs and energy purchases. The impact of this decision on consumers is evident, with the cost for an average residential consumption of 800 kilowatt-hours in the April-June quarter being approximately $157.49, an increase of $12.20 per month compared to the previous quarter.
The rate hike has sparked concerns among businesses and residents in Puerto Rico. Representatives of the commercial sector have emphasized that the increase in electricity costs, coupled with the aftermath of the pandemic and rising transport rates, creates a challenging environment for doing business on the island. The government's financial situation has also been a concern, with estimates suggesting that the agreement could result in losses of around $1 billion in the long run.
Puerto Rico's electricity infrastructure has faced significant challenges in recent years, including hurricanes, earthquakes, and blackouts, which have led to widespread power outages and a shift towards a higher reliance on petroleum for electricity generation. The country has set ambitious goals to meet all its electricity needs with renewable energy by 2050, but progress towards these targets has been slow.
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Rooftop solar and microgrids are more affordable than traditional electricity
Puerto Rico has a higher average electricity price than almost every US state. The island relies heavily on fossil fuel-fired power plants, with petroleum products accounting for three-fifths of its total energy consumption. However, natural disasters such as hurricanes and earthquakes have repeatedly damaged its electricity infrastructure, causing widespread power outages.
Rooftop solar panels and microgrids offer a more affordable and resilient alternative to traditional electricity in Puerto Rico. Solar power prices have decreased annually since 2009, and the US Department of Energy Solar Energy Technologies Office (SETO) has made solar energy more accessible and affordable for consumers. By using Energy Star appliances, Puerto Ricans would require less solar energy to power their homes, further reducing costs. Additionally, solar loans, leases, and power purchase agreements (PPAs) provide flexible financial options for adopting solar energy.
Microgrids are local power grids that can operate independently of the main electricity grid. They can power a single building or a group of buildings, ensuring critical operations stay online during grid outages. Most microgrids use renewable energy sources like solar panels, wind turbines, and batteries, delivering zero-emission electricity at a lower cost than the grid. Solar power prices are locked in for the asset's 20+ year life, resulting in increasing per-kilowatt-hour cost savings over time.
Microgrids also help avoid the capital costs and delays associated with utility service upgrades. For instance, a microgrid built for a New Jersey vertical farm customer is projected to generate savings of 128% compared to its original expected value. In developing countries, microgrids are the most affordable way to provide electricity to those without access, according to the International Energy Agency (IEA).
By adopting rooftop solar and microgrids, Puerto Rico can reduce its dependence on costly fossil fuels and improve its energy resilience in the face of natural disasters. These solutions offer a more affordable and sustainable path toward meeting the island's energy needs.
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Frequently asked questions
Puerto Rico has the second-most expensive residential electricity rates in the United States, at about 22 cents per kilowatt-hour.
Puerto Rico relies heavily on fossil fuel-fired power plants to generate most of its electricity. In 2024, petroleum-fired power plants provided 62% of the country's electricity generation capacity. The country's electricity prices are therefore susceptible to fluctuations in international petroleum prices.
Puerto Rico's per capita electricity consumption is less than half that of the 50 US states.
In 2019, the Puerto Rico legislature passed the Puerto Rico Energy Public Policy Act (Act 17), setting a goal for the country to meet 100% of its electricity needs with renewable energy by 2050. However, progress towards this target has been slow, and the country has continued to suffer from frequent blackouts.
High electricity prices in Puerto Rico have had a significant impact on the country's economy and society. The high costs of maintaining an unreliable grid driven by polluting fossil fuels have fallen on ordinary people. Frequent blackouts have also caused disruptions to businesses and daily life, with people often having to rely on emergency generators during prolonged power outages.
