Gov. Albert Bryan Jr. has declared a local State of Emergency to tackle the territory’s energy crisis and prevent further rotational power outages from crippling the U.S. Virgin Islands.
The immediate concern, he explained during a press conference Monday, is securing critical funds for the Virgin Islands Water and Power Authority (WAPA) – specifically, approximately $11 million in past-due bills owed by the territory’s hospitals and the V.I. Waste Management Authority, that has left WAPA financially strapped.
WAPA officials later confirmed that the overall debt owed by all agencies, both central government and semi-autonomous, is currently in the neighborhood of $25 million.
There are, Bryan said Monday, underlying financial issues contributing to the crisis. The government historically funds services until its coffers are depleted, and the the resulting gaps are then filled reactively, leaving essential agencies like the Waste Management Authority chronically underfunded. In a phone call with the Source after the presser, Bryan used trash collection as an example: residents receive daily service, even though the Authority may not have the budget to cover it.
Still, he stressed that overdue payments must be settled to avoid a complete breakdown of the power grid.
“We cannot afford delays any longer,” Bryan declared during the press conference Monday. “The time for talk is over.”
The State of Emergency empowers the governor to bypass Senate approval and tap directly into the territory’s “Rainy Day Fund” to cover WAPA’s immediate obligations. These funds will also address by Tuesday a $2.3 million debt owed to Aggreko, a company leasing generators to WAPA crucial for generating power. Bryan said candidly that it was the lack of payment to Aggreko that forced rotations last week on St. Croix, as the company turned off its generators, which are needed for the authority to maintain full capacity.
“I want to take immediate steps to ensure that the [financial] obligations of the Schneider Regional Hospital, the JFL Hospital, and Waste Management Authority [are fulfilled] and are once again paid in full, thereby providing WAPA with much-needed cash liquidity and, going forward, keeping the entire government current on its utility bills owed to WAPA,” Bryan continued. “This isn’t a subsidy. This is now about paying our bills in a timely fashion.”
Bryan praised recent attempts by the Senate to address the issue, but emphasized the urgency of the situation. Beyond immediate relief, he outlined a multi-pronged approach to achieve long-term energy security. Interestingly, it was almost exactly a year ago when the Senate passed a bill establishing a $100 million line of credit that would be used to support the purchase of WAPA’s propane infrastructure.
Included in the bill is a provision for WAPA to hire a turnaround management company, among other things, but Bryan said in a call Monday with the Source that he would also be tapping the Rainy Day fund for $3 million to cover the expense, which wasn’t provided for in the bill itself.
Meanwhile, Bryan said he would be formalizing, through the Public Finance Authority, the task force he said that has been working for the past year to spearhead efforts to improve WAPA’s fiscal and operational efficiency. This includes the long-delayed installation of the fuel-efficient Wartsila generators and the expedited adoption of renewable energy solutions across the islands. Most immediately though, the task force – which includes PFA legal counsel Squire Patton Boggs and the government’s financial team members, among others – will focus on finalizing the purchase of WAPA’s propane infrastructure, currently owned by supplier Vitol.
Bryan concluded his address by reiterating his administration’s commitment to a financially sound WAPA. He pledged to ensure timely payments to bondholders and creditors, and expressed a firm resolve to fix the territory’s troubled utility provider.
“My administration and I have pledged to fix WAPA, and I remain firmly committed to taking action to do so,” he said.
In a statement Monday, Delegate Stacey Plaskett affirmed her support of Bryan and the administration’s efforts, adding that she has continued to advocate for the award of federal funds to the V.I. Energy Office through President Biden’s Solar for All program.
