AAFAF - Autoridad de Asesoría Financiera y Agencia Fiscal de Puerto Rico

Puerto Rico Electric Power Authority (PREPA)

The Puerto Rico Electric Power Authority (“PREPA”) is a public corporation of the Government of Puerto Rico created pursuant to Act No. 83 of May 2, 1941, as amended.  PREPA owns and operates electric generation, transmission and distribution facilities serving all of Puerto Rico.  As the sole electric utility in Puerto Rico, PREPA provides electricity to approximately 1.5 million customers.

 

On June 22, 2020, PREPA and the Puerto Rico Public-Private Partnership Authority (“P3 Authority”) selected LUMA Energy, LLC to operate, maintain and modernize the electricity transmission and distribution system of PREPA for fifteen years through a public-private partnership.  For more information on this initiative, please visit the P3 Authority’s website at: https://aafaf.pr.gov/p3/projects/

 

Learn more about PREPA here.

 

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On July 2, 2017, the Financial Oversight and Management Board for Puerto Rico (“FOMB”), at the request of then-Governor Rosselló Nevares, commenced a Title III case for the Puerto Rico Electric Power Authority (“PREPA”) by filing a petition for relief pursuant to Section 304(a) of PROMESA, 48 U.S.C. § 2164(a), in the United States District Court for the District of Puerto Rico. As such, PREPA is currently a debtor in a proceeding under the Title III of PROMESA, 48 U.S.C. § 2161, et seq. Pursuant to Section 315(b) of PROMESA, 48 U.S.C. § 2175(b), the FOMB serves as PREPA’s representative in its proceeding under the Title III of PROMESA.

On May 3, 2019, PREPA, AAFAF, the FOMB, members of the Ad Hoc Group of PREPA Bondholders, Assured Guaranty Corp. and Assured Guaranty Municipal Corp., Syncora Guarantee Inc., National Public Finance Guarantee Corporations, among others, entered into a Restructuring Support Agreement (the “RSA”) which outlined the terms of a potential restructuring of PREPA and a settlement of related claims. This agreement was terminated by AAFAF on March 8, 2022, following certain changes in circumstances that demanded a revision to the RSA’s terms.

On March 18, 2022, the Court directed the FOMB to negotiate and/or determine the parameters of an appropriate plan of adjustment for PREPA and set deadlines for filings related to the plan process.

Currently, the interested PREPA stakeholders are waiting for the Title III Court’s proposal of a judicial mediator or a team of mediators within the next days in order to engage in mediation.

PREPA’s Title III proceeding is being jointly administered with the Commonwealth’s Title III proceeding for procedural purposes only in the United States District Court for the District of Puerto Rico under Case No. 17-BK-03283-LTS. The Title III case docket can be accessed for free by clicking here.