Empowering Puerto Rico: LPO Secures Funding to Bolster Grid Stability and Affordable Electricity Access

On January 17, 2025, LPO revealed two conditional agreements and one loan finalization for energy producers in Puerto Rico, aggregating more than $1.2 billion in total funding. Today’s disclosures each back a project tied to the Puerto Rico Electric Power Authority (PREPA) aimed at progressively replacing Puerto Rico’s fossil fuel generation infrastructures with renewable energy sources and battery storage systems through the year 2032. The highlights include:

• The finalization of a $584.5 million loan guarantee to affiliates of Convergent Energy and Power Inc. (Convergent) to fund a 100-MW solar photovoltaic (PV) array alongside a 55 MW (55 MWh) battery energy storage system (BESS) in the town of Coamo, with additional BESS setups in the municipalities of Caguas (25MW/100MWh), Peñuelas (100MW/400MWh), and Ponce (up to 100MW/400MWh), and
• A conditional agreement for a loan guarantee capped at $133.6 million to a subsidiary of AL-Infinigen Operating, LP (Infinigen) for a 32.1 MW-ac solar PV array with a combined 14.45 MW (4.76 MWh) BESS, plus a co-located, standalone 50 MW (200 MWh) BESS expansion within the municipality of Yabucoa, and
• A conditional commitment for a loan guarantee up to $489.4 million to a subsidiary of Pattern Energy Group LP (Pattern) for three standalone BESS setups in the municipalities of Arecibo (50 MW/200 MWh) and Santa Isabel (50 MW /200 MWh and 80 MW/320 MW), in addition to a 70 MW-ac solar PV system combined with a BESS in Arecibo.

Should all projects be finalized, they would more than double LPO’s endorsement for utility-scale solar generation and energy storage initiatives in Puerto Rico.

Through low-cost financing and an extensive due diligence protocol, LPO serves as a vital resource in the financial toolkit that the Biden-Harris Administration has assembled to reconstruct an affordable, dependable, and clean energy system in Puerto Rico. The potential for LPO to provide cost-effective financing is precisely why the Federal Oversight Management Board, appointed by the president in 2023, advised new energy producers selling power to PREPA to pursue LPO funding prior to beginning project construction. Due to dependence on imported energy sources, the ongoing risk of tropical storms, and underfunded infrastructure, residents of Puerto Rico presently endure average energy prices that are double the national average—while utilizing only one-quarter of the energy consumption per capita compared to the mainland US.

LPO’s first loan to an energy producer in Puerto Rico, Project Marahu, finalized in October 2024 and when completed, will contribute over 200 MW-AC of solar energy and up to 285 MW of standalone energy storage to the grid in Puerto Rico. Through its September 2023 partial loan guarantee to Project Hestia, LPO also facilitates virtual power plant (VPP)-ready rooftop solar and battery storage setups throughout Puerto Rico. As a nationwide initiative, the sponsor of Hestia is committed to ensuring at least 20% of installations under Project Hestia benefit homeowners in Puerto Rico.

Importantly, all projects announced today comprise a substantial quantity of energy storage. As part of its acquisition strategy, PREPA aims to install 1,500 MW of battery storage and mandates that a minimum storage capacity be co-located with each utility-scale solar endeavor. These resources are crucial not only because they facilitate PREPA’s target of 3,750 MW solar, but also because they enhance reliability and stability within PREPA’s system, which aging centralized facilities are currently struggling to maintain. Energy storage systems currently operational in Puerto Rico are activated daily. Including Marahu, LPO’s finalized and conditionally committed financing supports more than 100% of the capacity PREPA sought to procure under its initial request for energy storage project proposals, representing the first of six phases.

The financing announced today underscores LPO’s ongoing dedication to bolster Puerto Rico’s grid modernization and energy resilience. Please visit LPO’s Active Energy Infrastructure Reinvestment Projects by Borrower Type page for the latest list of all LPO announcements in Puerto Rico. For further insight into LPO’s evaluation of these projects as eligible for EIR financing, refer to LPO’s July 2023 blog entry.