live monday night at 9:00 eastern on c-span. and join the conversation, our hashtag is "landmark cases" and follow us @c-span. and we have the landmark cases podcast, an interactive book at cspan.org/landmarkcases. earlier this week, the senate energy committee held a hearing on puerto rico's electric grid following hurricane maria. . according to witnesses at the hearing, 98% of the island's grid has been restored but more than 22,000 people remain without pow er.

we are here today to learn more about the work that has good morning, the committee will come to order. we are here today to learn more about the bourque that has been completed, the work that is still under way as we seek to restore electricity to the people of puerto rico and to discuss this morning moving forward, so much remains to be accomplished. we'll also take a close look at the proposals to reform the island's energy sector, such as the governor's proposals with regard to the puerto rico electric power authority prepa, and the puerto rico energy commission. in a hearing we held last november on hurricane recovery efforts, i suggested there's three different tenets, basic tenets for the restoration and reconstruction of puerto rico's electric grid. i suggested we needed to make the grid more resilient to future weather events. everybody agrees, makes sense.

number two, in the case of damage from a future storm, bring the time frame for repairing the grid on par with the rest of the united states again, absolutely reasonable and the final is to bring down overall cost of electricity compared to pre-storm prices and moving forward. that is something we all agree must happen. up fortunately, i'm not sure those tenets have been adequately addressed though i would note some parts of the grid infrastructure are probably more resilient today but perhaps more resilient by default as they have been been replaced with newer materials. still, as last month's island-wide power outage demonstrated, the grid remains fragile and unstable. before we can get to those basic tenets, however, there remains a very mare question that i think needs to be answered and that is going forward who is in charge

of the grid. who is providing the vision for the future of the grid and who should outside parties be in contact with to help fulfill that vision, is it the governor's office, which is promoting legislation to sell off some of prepa's assets in contract with the third party to operate the transmission and distribution lines? is it financial oversight and management board which certified a new fiscal plan for prepa that includes a privatization process or is it prepa which has a new board of directors but could be upended by these other plans. or is it the prec, which claims responsibility for setting the overall policy direction for the grid yet could be besolved under the governor's reobjection plan. how did the department of energy and army corps of engineers fit into the hierarchy? there's many, many questions

here. today's hearing is an opportunity for officials to provide clarity to questions that many in puerto rico are asking they're asking why are we still seeing island-wide blackouts. they're asking where all of the federal dollars have gone, how have they been directed? as we enter a new hurricane season they're asking what efforts are being made to incorporate alternative energy sources so the island is not dependent on the global price of oil and they're also asking what the status of the prepa privatization proposal is. so there's a lot of questions to be answered. i would further add a concern about the consolidation of the regulatory agencies in puerto rico, particularly the prec, with puerto rico's fiscal issues, attracting capital investment is a struggle and without a stable regulatory

environment bringing in investors to upgrade the electric grid it will be even tougher so i'm hopeful our witnesses can help us sort through these issues and provide a little more clarity not only to the committee but to the people of puerto rico and many, many who are closely following the situation on the ground. so i thank you for being here as we focus on the important issue and i will turn to senator heinrich for an opening statement. senator cant wewell is out and appreciate you taking the chair. >> happy to do it. thank you for scheduling this timely hearing to examine the current status of puerto rico's grid restoration and proposals for the future operation of its grid. senator cantwell asked me to fill in for her at the start and she will be here later. before proceeding, i would like to take a moment to recognize the service of nine puerto rican national guardsmen. they were tragically killed last wednesday when their c-130 crashed shortly after taking off

in georgia. our thoughts and prayers are with their families and this is an important reminder the sacrifices that puerto rican american citizens make for this nation each day. senator cantwell asked me to acknowledge senators nelson and rubio for leading a letter of a group of our colleagues requesting this hearing. senator nellson hson has been s forceful advocate for puerto rico and i understand he was on the island last friday. i thank our distinguished witnesses for sharing their expertise and perspective with us today. hurricane maria struck puerto rico on september 20, 2017 causing the largest power outage in our nation's history and the second largest outage the world has ever known. we are still not done with the restoration process over seven months after the storm today 98% of power customers in puerto rico have power but much more work remains. to put in the perspective, tens of thousands of americans are

still in the dark and the threat to their health and well-being is real. we need to ensure that we have learned the lessons of maria so we don't repeat those same mistakes. congress will help to see federal aid to help puerto rico with micro grids and resilience into the future grid. i think we can agree a starting point is a robust, independent, and transport regulatory structure, something puerto rico has struggled with over the years. if we don't get this right, we'll be in the same place after the next hurricane. madam chair, i understand senator cantwell will join us shortly. i'm asking her statement be included in the record. >> it will be included. >> thank you. >> thank you, senator heinrich. let us go to our panel and i

thank you for joining us this morning and your contribution. the panel will be led off by bruce walker who is the assistant secretary at the office of electricity delivery and energy reliability at usgoe, good to have you back before the committee. we're also joined by charles alexander jr. who is the director for the contingency operations and homeland security at the u.s. army corps of engineers, we thank you for your work. mr. christian sobrino vega is the president of the government development bank and chairman of the board of the fiscal agency and financial advisory authority for the government of puerto rico. we welcome you. mr. walter higgins is also known to this committee, he has come before us before as the ceo for the port rico electric power authority, we welcome you. mr. jose roman mortales -- you

can tell my spanish is very bad. welcome. and mr. rodrigo masses is the president of puerto rico manufacturer's association. we welcome each of you to the committee this morning. and mr. walker, if you would like to begin, i'd ask you to try to limit your comments to five minutes, your full statements will be incorporated as part of the record and once each of you have been completed, we'll begin questions. >> chairman murkowski, senator heinrich and distinguished members of the committee, thank you for the opportunity to discuss the possibility for future operation of the electric grid in puerto rico. most importantly, i want to assure this committee the d.o.e. is committed to providing technical assistant to prepa as they begin their task of rebuilding and redesigning

puerto rico's electric grid. during significant events, services from energy critical infrastructure including water, telecommunications and transportation must be operational to support the safety and health of our infrastructure in puerto rico. the infrastructure of puerto rico must be designed, built, managed and maintain to ameliorate disruptions to facilitate rapid recovery. this is an improvement that will allow us to reassess technologies to address changing needs and d.o.e. and our labs will remain a partner to deploy cutting-edge technology to assist prepa. d.o.e. has nearly completed its report on energy resilience options and solutions for the puerto rico grid. this report provides recommendations for prepa and fema that reflected principles of resilience and inform investments in energy infrastructure. the recommendations address near

term and potential long-term actions that will require further analysis to make optimal investment decisions. several long-term recommendations that require additional analysis include, number one, power flow to asis power system operations, including generated dynamics and protective relay coordination. number two, production cost and capacity expansion to inform economic dispatch strategies and long-term planning. number three, micro grids, energy storage and system segmentation to identify where clusters of generation and lode provide maximum community benefit and number four critical infrastructure interdependencies. these items are being addressed through the development of a sophisticated modeling effort incorporating the efforts of five national labs. the model will be developed in phases working with prepa and will serve as a planning tool as

well as an operational tool. as a planning tool, it will provide contingency analysis and identify interdependencies of critical infrastructure necessary to ensure the health and safety of our residents of puerto rico. as an operational tool, it provide next worst case analysis in near realtime thereby providing system operators situational awareness in order to make sound operating decisions to improve day to day operation of the electric grid. the operational capabilities of the model will rely on near realtime data from micro phaser measurement units that prepa and d.o.e. are planning to deploy shortly in key locations throughout the island. further more the modeling effort will provide technical insight into the resiliency objectives for coordination and communication of potential solutions across stakeholder groups. this will help enable prepa to ensure the investments being made achieve the desired improvements necessary for a resilient grid.

of course any version of puerto rico's future grid requires incorporation of cyber security. uncontrolled disruption of our energy infrastructure is not only inherently problematic but it hampers our ability to respond to other types of emergency events like hurricanes. last last year, d.o.e. awarded over $20 million to our national laboratories and partners to support critical early stage research and development to strengthen protection of the nation's electric grid from cyber threat. one of these projects, dart net, is a collaboration between four national labs, three universities and several utilities, including the university of puerto rico and prepa. participants are working to define the requirements for a secure energy delivery system control network that is independent of the public internet utilizing what is called dark fiber. working with prepa, d.o.e. will seek to deploy this capability into prepa's grid as we work together to strengthen it, capitalizing on the significant amount of fiber optics of an

island. and just three weeks ago, my office issued a $25 million fnding opportunifnd i -- funding opportunity announcement to develop innovative approaches to advance cyber resilient energy delivery systems. focused on redesigning our existing system protection infrastructure for the electric and oil and natural gas sectors, the goal is to develop near real-time solutions that will reduce and potentially eliminate the risks presented by cyber attacks. this funding opportunity was done with an eye towards accelerating r&d efforts with an anticipation that we can incorporate these new solutions into prepa's grid and utilize them across america. in conclusion, the effects of this past hurricane season, though a disaster in the short term, now offers a unique opportunity to accelerate cutting-edge technology to improve puerto rico's grid. in this case, various forms of technology including micro grids, cyber, modeling, energy resources and strategic

utilization of storage are a few of the capabilities we are undertaking to improve the resiliency of the puerto rico and u.s. virgin islands electric sector. thank you, i look forward to your questions. >> thank you, assistant secretary. mr. alexander welcome. >> chairman murkowski and distinguished members of the committee, thank you for the opportunity to provide an update on the status of puerto rico's electric power grid. the core conducting emergency response activities under two authorities, the stafford act and public law 8499. in response to hurricanes irma and maria, we received assignments at $144 million and 44 maria related assignments to execute our traditional public works missions. over 15 million in flood control coastal emergency funds were expended you should our authority. i will limit my remarks solely to the restoration of puerto rico's grid.

on september 30, as a sign by fema, we soon led efforts to repair the power grid. to date we have received $2.15 billion for that mission alone. our task was to scope, coordinate and execute interim repairs to grid segments until a comprehensive restoration of the overall system could be implemented. the grid consists of 2400 miles of transmission lines 30, 000 miles of distribution lines over 300 substations, 16 power generation plans. an estimated 80% of the grid was damaged. it's part of the unified command group, ucg comprised of the island's preparation coordinator, the ucg makes decisi decisions according to the priorities and decisions that are carried out by prepa, the corps and our representative contractors, the road to repairing the grid consists of

four main lines of effort, provide temporary emergency power and spot generation for critical facilities, ensured a "generation at the power plants, reinstall and repair transmission lines and repair distribution lines providing power to the customer. for temporary emergency power the corps and its contractors installed 2,180 generators and as of may 7, 812 remain in operation. we anticipate the temporary mission will be extended until 31 july. we also installed nine microgrids to install temporary power to communities while grid power was being restored. currently four are operation al. to ensured a "generation at the power plants, the installed meg generators at the yabucoa plant, the corps will continue to operate both through mid-july. as of 2 may, 79% of transmission line segments, 69% of the

subtransmission line segments and 88% of the distribution lines have been repaired and energized. as of 7 may, prepa reports that 98.44% or approximately 1.45 million out of 1.473 million pre-storm customers who are able to receive electric power have their service restored, leaving approximately 22,900 customers without power. due the shortage of materials required to affect repairs, fema authorized usace to transport and store personnel. to date they have received over 33 million items. 5500 miles of conductor wire. based on fema's guidance and the design of the grid we purchased a mix of wood, concrete, and

galvanized steel poles. prepa's pole standards for distribution prior to maria was galvanized steel and these poles were used to repair the grid to the greatest extent possible dependent upon the supplies available at the time. concrete poles with reinforced steel were used to replace existing poles. all structures used to support transmission lines were aluminum with reinforced galvanized steel plaits. the csayo usace mission will en may. we have over a thousand usace contractors supporting this mission. as the mission assignment ends, there will be an orderly transfer of responsibilities and materiel. in the days remaining, we are committed to maximizing contributions toward restoration, the u.s. army corps

of engineers is proud to have had the opportunity to serve the citizens of puerto rico. this concludes my testimony, i look forward to your questions. thank you. >> thank you, mr. alexander, mr. sobrino vega. >> thank you. our focus will be about prepa itself and transforming puerto rico's energy infrastructure. the governor announced a vision for the transformation of prepa. it's based on attracted private participation to the sector through a concession of the transmission and distribution system and private ownership and/or operation of the generating capacity. the transformation is desperately needed. while hurricanes irma and maria left the electric system in shambles and millions of puerto ricans without electricity, the fragile nature of the island's electricity infrastructure was evident before the september devastation. the envisioned transformation is

intended to bring too puerto rico a consumer-centered model that provides people with options, is sustainable, open to advanced technology and is resilient to future atmospheric events. establishment of an independent regulator and a regulatory structure that creates investor and customer confidence is critical. the transformation is intended to be an innovative energy mod dwell a commitment to renewable and environmentally friendly resources and with the goal of achieving 30% renewable energy generation and an aspirational energy cost of 20 cents per kilowatt hour. it will provide a springboard for the modernization of puerto rico, attract new business and create jobs. the government intends the transformation process to be achieved through a proven model, puerto rico's public/private partnership act. the p-3 act is well understood by investors and has been used in resent concessions.

the legal framework is one that promotes a competitive process and ensures transparency and fairness while still providing the flexibility necessary to achieve the best results for puerto rico. we also expect the transaction will be approved by the title three court having jurisdiction over prepa's insolvency proceedings. in any structure, federal funding provided for permanent system improouchts will be necessary. to achieve the appropriate levels of resiliency and hardening of the system consistent with federal law, the structure of the transformation will be designed to assure benefits of federal funding flow to the citizens just as in any national the disaster. to make the recovery efforts the most transparent, effective and efficient in history, the governor created the central recovery and reconstruction office for puerto rico. the recovery office is responsible for the development and implementation of a plan for the reconstruction of the island in the short, medium and long term. in addition the recovery office is intended to provide financial

accountability during the transformation process. but one thing needs to be very clear. the u.s. citizens of puerto rico must be the principal agents in our recovery. mechanisms are being instituted to show and provide confidence that we will be good stewards of u.s. taxpayer funds. during the transformation process, we anticipate a new or modified at qualitily funded and independent regulator will be established by the puerto rico legislature. we expect this regulator will be comprised of five highly qualified members with staggered six-year terms to mitt get against political interference. they may only be removed for just cause consistent with puerto rico case law developed in that process. this regulator will be free for regulatory conflicts and structured to support the steps leading to sector transformation. we expect this commission to be supported by a staff with utility regulation expertise and that the rate payer advocate

will exist pratly to provide an independent voice for consumers. after a transformation has been completed with a successful transaction. the struck structure will implement puerto rico's energy policy. it must do that while creating investor confidence and attracting private capital. transformation of the energy sector is a vital part of puerto rico's economic recovery. the government's economists inform us that empirical analysis from argentina and other countries indicates that a 1% increase in investment will increase gross domestic product per capita by .3%, implying that consistent investment results in considerable increase in gnp levels over time. in the recently certified fiscal plan for prepa, the oversight board projected that the energy reforms would increase growth by .30% starting in fiscal year 2020. as a result, electric sector reform is one of the linchpins of the future of puerto rico. with these words i will submit

our testimony and look forward to answering your questions. >> thank you, sir. mr. higgins, welcome. >> thank you, chair murkowski, senator heinrich, thank you very much for inviting me today. i'm now in my sixth week in puerto rico. slighted to be there. i want to start by thanking the congress, the federal government, especially fema. the usdoe, the u.s. army corps of engineers and more recently the hud for all the things that are going on that are helping puerto ricans and puerto rico's electric utility to become better and to be restored. there are many, many initiatives that are under way or soon to be under way and we look forward to how those will help to shape the grid in the future, you would like to recognize the many public and private utilities that came to puerto rico after the storm and helped us, hundreds and hundreds of people, to get as many people as possible restored to power.

you heard mr. alexander say that as of last night 98.44% of the people of puerto rico have power available to their premises. that's good, but it's not nearly good enough because there are still 23,000 people that do not have power available to their premise and we have about 1900 field workers in the field in puerto rico working on resolving that problem. in addition we also know that there are some places that may be just too hard to get to in any reasonable time, we have activities under way to find alternate solutions for those people, perhaps micro grids. at a minimum, solar generator, solar battery and emergency generator. those activities are under way actively trying to figure out who we won't be able to get to. one thing we're sensitive to at

this moment is the impending hurricane season that starts in three weeks. we are updating our emergency plans island-wide as well as inside prepa. we will hold an merge drill inside prepa a few weeks from now and after that there will be an island wide emergency drill to make sure the island is ready and whatever lessons we learn we will hold another drill in june so we will have practiced and practiced to be as ready as possible for the next season. we're now moving from the planning and execution of restoration to what's called recovery and we have lots and lots of things to do thanks to the federal dollars that are going to be made available and the idea that we can do better than we have done in the past yesterday we announced the adoption of a national standard, the rus, rural utility service standard, for all future

construction in puerto rico of the grid. that's an important step for us. the system was designed to american society of civil engineering standards in the past but this national standard will help to facilitate bringing people into the i land, getting parts on a faster basis. making it easier to model. easier to restore and adopt new technology because everything we do new from now on and to be rebuilt will be done to an accepted national standard and the rus standard is a good one. two things stand out as needing to be fixed and they've been eluded to in one way or another. the grid did not withstand the hurricane. it simply didn't withstand it. the grid has to be able to do better and it has to be restorable faster. much if not most of the grid was design misdemeanor, many years ago, more than 20 years ago and sadly it's not been tim kaine tim kained the way it needed to

be maintained. you don't just build a transmission tower and walk away and hope everything is fine. you have to make sure the guy wires that hold the towers up, that everything is still there and intact. that needs to be done. secondly our generation does not perform as well as possible. that's certainly been hurting us recently. most of the generation that's active and capable in puerto rico is on the south side of the island. most of the load is on the north side of the island. sadly the interconnection is what got damaged so badly during the her cane so any time, like happened recently there is an incident that affects the grid, the transmission system, the generation can quickly get out of balance and a blackout can and unfortunately did ensue, so we believe with the right technology such as secretary walker talked about with the right amount of maintenance with a view of how to build the grid

back using resilient, renewable, distributed and more efficient resources, puerto rico's grid can be the grid the customers need. thank you for your attention. appreciate being invited. >> thank you, mr. higgins. mr. roman morales. >> thank you for inviting me to appear and for your interest in puerto rico's plans to transform its grid. the commission has continued to carry out its statutory duties, aware of the need to restore electric service fast and effectively while simultaneously seeking a sustainable development, the commission promulgated draft rules for the development of microgrids and is about to publish the final version of the same. the commission has also issued new integrated resource planning rules and is we pairing to guide prepa's 2018 irp process. the commonwealth is at a decisive moment for the development of puerto rico's electrical system.

the clear mandate to transform it into an efficient cost effective and resilient electric system becomes more important than ever. so it's of u.s. most importance these decisions are made based on a rigorous analysis of the needs of the country within an orderly and objective planning process. the commission ordered prepa to file the irp by october, 2018. we have initiated a proceeding to set new rates for fiscal year 2019 to reflect prepa's new cost structure. the hurricanes have affected prepa's costs, revenues and expectations of future sales making it unlikely that the rates in effect today satisfy the statutory reasonable standard. there are many decision makers involved in puerto rico's electric industry. there's prepa, the fomb, the governor, the commission, the federal government, among all of these players, there should be

one common goal and that is performance for the consumer. in order for the term privatization to be useful, it needs more clarity otherwise people will confuse ideologies with solutions. they are four distinct concepts that sometimes get confused and combined, they are market structure, asset ownership, operational respond and business ownership. so when someone speaks of privatization it is not clear what it is they propose to privatize. assets, operational responsibility or the business. and it's not clear where they want puerto rico's historically monopolistic market to remain monopolistic or to convert it into a competitive market, instead of privatization, i would describe it as restructuring. there's more to transformation than just a change of ownership.

too often people talk about privatization and market structures when what they want to do is escape the costs of the past, address only their own needs and leave the resulting problems to others. that approach will not solve puerto rico's problems. to produce the performance puerto rico needs, we must follow a logical sequence of steps. first, describe the mix of products and services that customers need. describe the qualities of those products and services in terms of reliability, timeliness, innovation, ease of use and resilience. identify the market structures that will provide those products and services most cost effectively. identify the companies that can most -- that can provide services cost effectively. for those services that will remain under a monopoly market structure, develop the necessary regulatory procedures for them

to proceed and principles and for those products and services to be provided around competitive market structure, create regulatory principles and procedures there are many decision makers and stakeholders involved in puerto rico's electric industry, all with ideas, plans and proposals to address puerto rico's situation. all ideas, all paths to performance should be on the table, but all ideas should compete in a merit-based fact-based transparent process. we must find the best paths to performance, the integrated resource plan approval process will determine the correct mix of resources that is most cost effective from centralized to decentralized generation, from the impact of the manned response programs and energy efficiency to address the highest consumption that occurs during the evening in order to

allow highest penetration of renewables. the commission is ready and able to assist the commonwealth, the fomb and congress to define the regulatory frameworks and market structures for the benefit of the people of puerto rico. chairman murkowski and members of the committee, thank you very much for this opportunity to testify and i look forward to your questions. >> thank you very much, sir, mr. masses. >> good morning madam chairman, good morning senators, thank you for having us here. we already submitted our testimonial so if you don't mindly summarize our points. first of all you ask about who's in charge? who's in control? . the governor, the oversight board, prepa, energy commission. maybe i could answer who should be in control, the private

sector should be in control. the manufacturers' association represent 50% of the gross domestic product in puerto rico. no other sector gets close to 7% or 8%. in the past two or three decades we've been very much affected by bad and expensive energy. as a matter of fact, when they mentioned 98.8% of the people of puerto rico getting back on energy, it should be corrected, getting back on bad and expensive energy. we've been subject to blackouts and brownouts costs millions of dollars in terms of product lost and time lost and of course equipment damages.

so we are going to hear and listen to many statements, we will receive a lot of data and, yes, you're right, we need a stable and robust regulatory framework, legal framework and yes, it's very important to have an independent regulatory entity and we need to complete the integrated resource plan that was approved by the energy commission in 2016 in order to have a good map of what to do, how to transition this power. we also need badly to allow the productive sector to generate our own demand to own the energy we need by allowing us to co-generate or generate by using distributed energy. and, yes, transparency.

it doesn't matter if we have a beautiful irp and beautiful framework. if we go through the typical process of rpfs, we may get back to bad and expensive energy at the end of all this, so the process of public auction, the way that everything is presented, the way that the agency announced the opportunities, the bid, allows you and me, if we are competing against each other to review and audit our proposals, allow the press to follow up in all this, that's the only way we're going to finish a good product at the end of all this. we have been accumulating a lot of intelligence, we have the data we just have to go and

execute and the only way we are going to be silent is when we own the generation that we're going to use, thank you, madam chairman. >> thank you and thank you each for your statements this morning, there's a lot to discuss so let's get right into it. let me ask first, mr. alexander on the time line that you have here, may 18 is the end date for the army corps power restoration mission so it concludes at that point in time 98.44% of folks having power there is good but for the 22, 900 who are without i would imagine that look at that date and say wait, you can't leave us. is there any consideration of an

extension of this mission? any need for it to be extended? >> ma'am, i believe all options were looked at. the unified command group, they deliberated. the gentleman to my left sits on that body, our authority to be there rests with fema and our resources so we will do whatever the mission is but we right now have been told at midnight on the 18th we will transition orderly with fema our lines that we're working on and the material that we have and we men arish their inventory as well. >> let me ask about the orderly transition, they may be directed either to you mr. alexander or mr. higgins. big story, not too many weeks ago, about the raid -- i guess

it was in january, so a couple months ago now of a prepa warehouse at the palo sector, the power station where the rebuilding materials were seized so we've had a lot of discussion. you've mentioned the inventory of the materiel purchases but recognizing that that was one of the initial limiting factors in restoring the electric grid because you had supplies that were being requested in other parts of the country for other hurricanes. so you had a supply issue at the time. we've worked to address that. then you have a very serious incident there in january where the material are secured so now you say you're going to do an orderly transition. the k you give us that assurance that we do have the materials

that are need ed and that will entail when you move on and the work remains? . ma'am, i'll start off. we will conduct an audit, an inventory of the material that will be turned over to prepa to replenish stocks consumed during the response and the material they still need to complete the mission. >> how much is outstanding? do you have a sense? terms of what is needed to complete? >> in what we need to complete? well, we're down to 1.something percent. until we hit 100%. i don't have the actual count for number of poles, transformers, conduit, et cetera. >> i guess where i'm going with the question is whether or not we are still in a situation where we have a shortage of

material for the completion. you're suggesting no because we've got to that 98%? >> materiel is no longer a limiting factor. it was initially because there are literally in many cases the material wasn't there. it had been consumed in the previous storms, it was coming straight off the manufacturing line and there were unique specifications that apply solely to puerto rico. >> mr. higgins, did you want to add anything to that? >> i think mr. alexander correctly stated that materiel acquisition is no longer a big-picture problem. all the materials are either on the way or on the island or have been deployed. there could be a localized problem where a material isn't available to a crew at a particular time but that's more of a matter of getting it to them, getting it from central to regional warehouses and to a crew, the important thing going on with the army's mission ending is the assumption by

prepa of the logistics operations that the army has admirably performed over the past many months. so now we're in the process of prepa's material acquisition people taking over the inventories, all the material the army has acquired for this, taking over the remen arishment of future materials, receiving the materials the army quote/unquote borrowed from prep pa and being in addition being prepared to operate the logistics and material activities in a way that supports continuing restoration or -- and the on going and soon to be under taken recovery. >> we're prepared to take that up? >> it's going to be a challenge and we're probably going to get some help via the vie a for ma but our people feel they are ready and the fema will give us additional augmentation. >> well, i guess recognizing may

18 is coming up like next week, we sure want to know you really are ready and that it's not -- that you're not still working through things. that's next week so if there are things, if there are steps, if there's anything that needs to be done on the outside looking in to help facilitate that, we would hope that you would make sure that that is known. >> we feel that we are ready to take this task on and the help will make sure that we are ready. i don't doubt we'll have growing pains, this is a massive effort but we are ready to take the task. >> i understand that, sir and appreciate it but i also think that for those that have been living with great uncertainty about their power generations since these hurricanes, these 22,900 that are still without, when they hear you say there's going to be continuing growing

pains, that must be really tough on them. >> i completely agree with your comment, madam chairman. >> senator heinrich? >> i'm still trying to -- i'm having a hard time wrapping my head around this. mr. alexander, if there are over 20,000 puerto rican american citizens without power, is your mission accomplished? >> our mission as assigned by fema is. >> i don't think that's acceptable i cannot imagine a scenario where 20,000 texans or there are -- floridians are without power and fema would make that decision. i think that's reprehensible. mr. masses, i want to get to the bottom of something you raised that i think is a game changer here. puerto ricans pay painfully high retail electric rates, both individual citizens and

manufacturers. i can't imagine a world where you try to make manufacturing work at 20 plus cents per kilowatt hour. a lot of that is because of an antiquated overreliance on diesel generation which is incredibly expensive. so at a time when we see new generation from wind, from solar, from natural gas all priced in the bulk market at two to five cents a kilowatt hour it seems to me that even on the retail price we ought to be able to build new generation cheaper than operating the existing diesel generation. am i missing something here? >> by all means, by all means but let's get back into the material question. >> why can't youch? >> they talked about the inventory is not a problem anymore because it's been handled. what about in the next three or four months if we are hit again?

is the invennerly tory there? they fixed what was broken the last two or three months but what about if we get hit again? are we going to go through this again? of course, if we own our generation we will the inventory available to fix our problems. >> so what are the barriers to your members being able to own their own generation, their own storage, their own behind the meter distributed resources that then cannot only support your members but in an emergency potentially provide services back to the grid? >> well, not just in an emergency because we can design it in order to share our access with the community and other components. so we could design all this in a proper way to help everybody in puerto rico. >> why can't you do that today? >> well, we have not been able to do that in the past because

typically prepa protect their invoice. remember we are the biggest invoice in the company. so they may be concerned about this. i guess in terms of technologies so are many others that are available and that could make things very nice. >> mr. higgins, what is the prepa legal stance with regard to behind the meter resources? with regard to solar and storage for individual retail customers as well as with regard to large commercial customers being able to have behind the meter generation? >> senator heinrich, i think the question needs to be answered in kind of two ways. number one, puerto rico needs to change the way the grid is supplied by power today. it is not being adequately and properly supplied with the current generation mix. that generation is troubled by a

maintenance issue. it's troubled by being reliant on oil, which is both environmentally and cost-wise a difficult commodity. and there's not enough generation where it needs to be. and in some cases there's too much where we don't need it. so the grid needs to be rebuilt. not just the wires but the generation needs to be rebuilt. and as we change it out, and i agree with mr. mosses in that regard. we should be building out and we need to interconnect with them safely such that the grid is still safe, the workers can still work without danger and the customer is able to supply what they want to. and prepa in the new world will supply what prepa is capable of supplying for people that don't want to do it themselves or when it's economic. >> do you have a current net

policy either for retail or large commercial users? >> as i understand the retail policy i've not spent a lot of time looking into that in my short time there. a customer in order to be a retail solar customer and still be connected to the grid must have a system that supplies their own needs and have storage. therefore, they aren't going to suddenly rely on the grid when their system doesn't work. that i believe is our current way of dealing with behind the meter solar. >> thank you. >> senator heinrich. senator cassidy. >> i agree with what the chair said. there's a lot of things to talk about here. but let me kind of go to you, mr. walker, and i think also you mr. ovega. you mentioned the desire for resilience and for 30% renewables. now, when we took our tour of

puerto rico, there were lots of smashed windows, and our tour of the u.s. virgin islands a lot of smashed solar panels. so i'm guessing if you're going to be resilient there has to be at least some redundancy in terms of, yes, we have renewables but there has to be an amount of back up generation either base load and/or reserved generation. is that correct? >> senator, when i spoke earlier i spoke about the integration of renewables as part of the strategy. i did not indicate any percentage like in rps. >> that may be used, sir. >> that being said the question you asked is a good one because i, too, saw the havoc that was brought during hurricane maria and the impact it brought to renewables. to thatened part of the effort we are undertaking is the utilization of our expertise of

our weather data, particularly wind, to identify whether there are opportunities strategically to replace things like solar and wind like we saw damaged in puerto rico, using the topog raefr of the island to facilitate its ability to withstand hurricanes. >> presumably, though, it'll always be more vulnerable than other assets. and sir, you were going to comment? >> yes, resiliency requires resiliency in generation capacity on the island. that's a given. but the introduction of renewable energy sources is not -- the way it's structured in our renewable portfolio standard that was legislated back in 2010 and amended subsequently is to provide a cheaper source of energy that can allow the energy sector and be positive producing energy on the island is lower than if we only depended on a diesel and

petroleum product. >> i accept that. so there would be redundancy if you will for resiliency, but you would have a lower price. >> that is the goal, yes. >> mr. higgens put it nicely, the generation is not co-located with your consumption. so i recall that coal powered power plant on one side of the island, but it's the opposite side in san juan. now, there were -- that seems as if you're going to address that. you're actually going to put some of this redoesn'tant necessary for resiliency capacity on the opposite side of the island from the coal-fired plant. i presume that plan is in the works? >> yes, sir. one of the important initiatives that we are undertaking is to look at possible and hopefully repowering some of northern

generation. both bringing the maintenance up to standards and repowering it with hopefully a liquefied natural gas imported and then burned in the generators. >> thou, we saw that. now, going back to the former regime, i remember being struck by that plant outside san juan, it was rusted. i mean, it was just amazing how lousy the maintenance had been of that plant. but there were two i think ge looked like jet engines sitting there generating electricity. so do you anticipate this sort of lng associated with these sorts of engines on multiple places around the island so it can back up these microgrids and the 30% renewable? >> senator, for the first round we're thinking of perhaps a small not a massive lng solution for the two jet engine installations that you talked about.

so instead of being fired by oil they'd be fired by natural gas. >> i thought those were fired by natural gas. >> they are not fired by natural gas today. i think it's also very fair to say that we are not proud of the maintenance condition of our fleet. whether it's the generating fleet or our transmission grid. our future budgets call for that. >> and lastly but to my point, it seems when we flew there, it seemed as if again you have this island way over here that was one of the last places to have it restored and then you have the mountain separating the islands in three different places. you know exactly what i'm fumbling to describe. again, would you put those two sort of jet engines in those places or are we again going to

have these lines stretching over this mountains through a big storm? >> senator, what we're going to try to do through an integrated process that the chair has addressed and mr. subreeno has addressed, that mr. walker has addressed integrated resource planning is modern highly developed methodology for determining what the right mix for resources and grid improvements and technology should be to best meet the island's energy needs. it's clear that we're not meeting them very well today. therefore, the integrated resource plan should identify the very kinds of things you're identifying. where does the generation need to be, what kind of generation would make the most sense, meeting all the goals, whether environmental or -- >> let me stop you because i'm out of time. but i will say that i guess one more question i would have asked and i'll ask for the record, we just spent all this money

rebuilding but it looks going forward we may redistribute. it does seem as if there is an inefficiency in resource allocation. again, maybe it had to be done that way, but it does seem you're going to relocate from your testimony. >> thank you, senator cassidy. senato senator smith. >> thank you very much for being here. i am new to this committee, but i am just so struck by the reality that with hurricane maria american citizens lived through the second largest bl k blackout in the history of the world and yet we're still working to recover from this. and i am thinking about what would happen if this had happened in my state of minnesota and we were still waiting to recover. and i appreciate the complexities of trying to respond to this amazing disaster, but i'd like to just first go to mr. walker and mr.

alexander and just try to get at what you think our responsibility is in puerto rico. we have this committee has to be the voice for puerto rico here because there are no representatives from puerto rico on this committee. but what is our responsibility to make sure that we recover quickly from this? it feels like it's up to us. >> ma'am, our responsibilities are tied to the stafford act and it's to provide temporary interim repairs not permanent repairs. you know, we have a -- the court has a long history in working with puerto rico. we have an area office there. we work on projects. we'll continue to be on projects. our jacksonville districts is focused on puerto rico. we are -- you know, our responsibility is to turn the lights on as quickly as possible and other missions aside.

and we're doing that to the best of our ability. >> i appreciate this is complicated as i said. but i'm glad to have this opportunity to figure out what we all can do to do better. because i think about what would happen if we were in minnesota and we were coping with this. mr. sabrino, we know with climate change we're going to be seeing more storms, more frequent storms, more the tense storms and your testimony i think really gets at laying out the problem that all of us have in puerto rico with long-term failure to invest and modernize in the electricity system and also the need for transformation, right, so that it is more sustainable and as you say customer centered in the way we do this. i always think about how we can have more affordable, reliable and clean energy as a solution

to that problem. but could you talk to us a little bit about what you see that the federal policy changes that we should be considering or the things we ought to be considering from this committee's level to help you to achieve that goal. >> the main driver right now in the recovery effort in puerto rico is really the funding. the issue with maintaining the infrastructure for prepa, the truth of the matter is prepa was succumbed to a fiscal crisis. and when you have any public entity that is involved in a fiscal crisis typically what you'll see is that the first budget item that goes down is capital expenditures and maintenance costs. that explains why the san juan plant had rusted infrastructure. why you had transmission lines that hadn't been replaced. the mere effort of re-establishing electricity was

in and of itself an improvement than what we had before. so something we should appreciate and the federal agencies like doe, fema that have been been helping us out on this is ensure that the infrastructure funds that are provided to the island reflect what is the best assessments not only from a conceptual phase up here in washington, but what we know in puerto rico to be best for the island. >> thank you. and do you see -- i just want to ask a quick follow-up question. as we think about the goal of getting more resilience as well as more affordability do we think having more generation takes away from the affordability of this system? >> no, there are inherent difficulties with producing and providing energy and fuel to an island that's part of the reality that puerto rico faces.

what we do need to make sure is while we strive to have cleaner and renewable energy sources we do provide for redundancy in the case there is an event we can -- >> yeah, that's not the conflict. and it strikes me that my colleague senator hirono might well have comments about this given the similar situations hawaii has and the huge emphasis on renewables. madam chair, i realize i'm out of time. and i appreciate we follow-up on the question you raised about who's in charge here and how we make sure the coordination happens so we can be successful. >> thank you, senator. senator gardener. >> thank you, madam chair for your time and testimony. thank you for allowing this hearing to be held today and thank you for the time and

testimony of the witnesses today. in your testimony you described how doe provided both modeling support for the island electric grid and technical assistance. i think you answered yes to the questions where these grid models and the long-term role they can play. but the models you used on microgrid modeling will they be made available to future operators of the grid? >> senator, absolutely. my team is working with mr. higgins' team. we have both people from puerto rico today as well as personnel from my rnd organizations coordinate coordinating with the national labs. >> can they be used with other national models within the continental u.s.? >> absolutely. >> and will there be regulatory

modifications to address the increased use that we can transfer them to the 50 states? >> yes, we're building a bigger and larger sophisticated model in puerto rico that will be both a planning tool and operation tool with the idea that we will be able to transport the lessons learned while we're building that model into the model for north america. >> i think you mentioned the doe is working with southern states energy board to develop a policy and framework that would help provide a regulatory process for structuring and privatization efforts in puerto rico. >> mainly doe's role there was -- the secretary and i met with governor bryant from mississippi who chairs the executive board representing our expertise from doe is on the technical side of the energy systems. we hired the southern states energy board to work with puerto rico and usdi mainly because

usvi and puerto rico are already members of ssbb and they have worked with different municipalities. >> how broad of a definition does that resiliency cover? do you have the ability to not only withstand storms but man made physical and cyber threats as well with this resiliency? >> i think as the grid has developed and much along the lines as assistant secretary walker talked about, we will build into these systems more resistance more resiliency to let's say a cyber attack. as we rebuild and redesign the grid to the newly adopted standards, and with the help of the federal government which we appreciate, we'll be able to bring some of these things so they're resistant to the storms that might come.

>> what authorities do the governor or legislator attain in assigning or approving a management team there? >> i was asked to come to puerto rico with the full knowledge i could replace anybody in management that i felt i should replace. i've received no interference on that. the governor has made clear to me that i am an independent ceo, have the authority to replace management as i see fit. >> so the governor and legislator, what authorities do they retain? >> he sets policies for island, and my job as the head of a major state agency albite an independent board is to carry out the authority of the manager. >> but you've got that authority? >> completely. >> i would like to clarify that walt is the first ceo of prepa that was appointed during a nonpolitically influenced process. he was selected through a

head-hunting mechanism, evaluated through a committee that was compromised of the independent directors of prepa. and he was selected through that governing structure, and that is something we are very proud of, that we have this first nonpolitically appointed ceo for prepa. >> your testimony you expressed frustration with both the governor's office and the fomb contending their impeding in the efforts. can you talk more about those frustrations directly? >> yeah, sure. thank you, senator. i have expressed my frustrations one with the fiscal oversight and management board. what we've seen has been an overreach of the delegative powers of my congress. i will ask congress to really specify to fomb they should operate within trying to harmonize commonwealth law and not against commonwealth law. as we see congress delegated the

fiscal oversight and management board fiscal duties but not policy responsibility within the island. that remains completely within the commonwealth of puerto rico and where the commonwealth delegates for the commission then the commission will carry out its duties. the fiscal problems with the commission is self-sustainable. our funding is -- we have not been able to fully utilize our funding through a hiring of either external counsel or external consultants or hire new personnel because of this law that requires the approval of the office of the governor. and that has taken a long time to acquire. and that has actually impeded the purchase of the commission. >> thanks to all the witnesses. thanks, madam chair. >> thank you, senator gardener.

senator cortez. >> thank you. mr. higgins, let me start with you. during our last hearing on this subject it was made clear to the committee that the stafford act as written requires funds to be used only to restore damaged equipment to its previous state which makes no sense to puerto rico givethen disrepair the electrical system was prior to the hurricane. provision was required allowing funds to replace or restore system tuesday the industry standard without regard to the pre-disaster condition of a facility. it also allowed flexibility to allow components not damaged by the hurricane to be replaced in order to bring a larger system up to industry standards. so my question to you is does this provision go far enough in enabling prepa to build for resiliency and reliability? >> senator, i think that the way it's written in subject of course to funding, it does go far enough.

these are serial activities. you can't redesign and rebuild a system from scratch and completely upgrade it to the new standards. you had to get the power back on first. so that's been the priority. but as i understand the funding, as it's been explained to me, as i read it, provided it is funded, there is enough authorization activity and hopefully funding to rebuild the system so it meet modern standards. >> so mr. walker, let me ask you the same question. do you think we need to take any further action in regards to stafford act in order to achieve power resilience in puerto rico? >> yes, i do. testifying in front of the house i spoke to this a cup of weeks ago and my point was that there's an opportunity for us to allow engineering to be done to modify and make corrections with regard to design, particularly to add the resiliency. and so rather than be held to

what a standard may very well be, there are opportunities, and i think opportunities has presented many of those, where we could have replaced and made decisions early in the restoration process to increase the capabilities for let's say a line. so i could build it with double up buck poles as opposed to what the industry standard might be, it might be a single. so i think the capability to allow those on the ground making decisions with regard to the emergency restoration to incorporate the ability to modify the system and to add capability whether it's through redesign or just stronger equipment even if it exceeds industry capacity or the industry standard. >> and that's true for not just puerto rico but some of the other islands that sustained damage as well. >> that's right. >> thank you. would you be willing to work with my staff as we address these issues? >> yes, ma'am. >> thank you.

mr. higgins, let me go back to a question that came up, and i believe it was the chair who talked about this. and the concern with the corp leaving may 18th, and my understanding with prepa taking over. so you mentioned in your response to the chair that as you take over these logistics that there are going to be challenges to take over the logistics to engage in the continuing recovery. what challenges were you talking about? >> there's a -- senator, thank you for the question. there's a massive amount of material both still coming in, and that needs to be reintegrated into prepa's warehouse system from the army's warehouse system that they very capably developed in order to fight the battle, so to speak. so our people are now in the process of receiving all that material and all the paperwork that goes along with it so that everything is properly accounted

for along with getting all of the material out of the lay down yards and army warehouses, getting out of the warehouses, that's a lot more than the company was doing. we asked for some temporary help. but our people feel they're capable of and i agree with them of managing the ongoing material requirements. that this transition period where we're getting a lot more stuff, a lot more things to do and we have to comply with fema requirements to be sure its reimbursable. >> so who's providing the help for you? >> fema will fund some temporary help for us. i don't know exactly the source, senator. >> would you prefer that the corp extend its mission and stay and continue? >> we've been delighted with the work the corp has done, and at the end of the day it's not really prepa's decision. we're very interested in how the work got done, and the corp engaged contractors to do that

work and they've done a good job. and the corp also took over the logistics operation, which was very helpful. we just want it done. we're not indifferent. we want the job done well. we have more contractors coming to the island to replace the corp's contractors. this is fema's choice. but i think fema is making choice dictated by what their guidelines are as well. >> thank you, madam chair. >> senator lee. >> thank you, madam chair for holding this hearing. thank you all for being here. i'd like to start with mr. alexander. are you concerned with mismanagement within prepa? >> no, sir. i am not. we've been a partner. we've been in collaboration with prepa since day one. we've been working out of their headquarters. i believe it's been a partnership that has led to our ability to get as far as we have. >> are you aware of any ongoing

investigations regarding the missing inventory information for warehouse five located near puerto rico's palo seiko generating station? >> sir, i'm not aware of any. >> can you tell us why the raid of warehouse five was conducted on january 6th? >> i don't know if i would characterize it as a raid. i believe it was just some of our personnel were there and they happened to notice there were some supplies in a warehouse that had not been previously identified when we were working with prepa to inventory the stocks on hand, which would ultimately inform what we needed to procure. >> since that operation whether you call it a raid or otherwise, do you have reason to believe that there are other gaps in prepa's inventory?

>> no. i think an expensive joint inventory was done, and again that's what resulted in the material we procured. about 90 plus percent of the 36 million items we ordered has been delivered. i think the inventory will not only allow prepa to refinish stocks but finish the restoration mission. >> okay. mr. higgins, i'd like to talk to you for a moment. in november before this committee i asked governor -- about some of the serious issues with prepa's management and operation. and so i'd like to follow-up on that by asking you directly. do you think there's mismanagement and corruption within prepa, in puerto rico generally and in particular with prepa? >> i have no idea about puerto

rico, senator. i don't know enough about it yet to know that. i can tell you this. that with respect to prepa, there are always going to be in an organization of 6,000 people, something that's going on that shouldn't be, and we're going to vigorously investigate and go after anything that's not done the right way. similarly i've told all the senior managers that were there when i came it's time for you to decide if you want to be a part of the solution or you don't. and if you don't want to be a part of the solution, tell me now. because if you don't tell me and i have to make a change, it's not going to be nice. so some may make it. some way not. i'm optimistic that some get it, that prepa's going to be different in the future. but i've made quite clear to them, you've got to be different. you've got to be a different kind of leader and run the company differently than it used to be run. >> to the extent you're suggesting that prepa is no more

susceptible to or vulnerable to or the victim of mismanagement and corruption than any other business organization or any other utility company, state-owned or otherwise, i don't think you're suggesting that are you? >> no, sir, i am not. i'm simply saying within a group of 6,000 people there's likely to be somebody that's not doing the job the way they ought to. hopefully it's just not doing the job as opposed to something corrupt. but anything that we find that even suggests corruption will be seriously and thoroughlily investigated and dealt with strongly. >> some of the things that have concerned me involve reports of staffing being hired without experience or expertise hired for the job, widespread theft of power and billing failures,

outdated infrastructure systems that cause an unusually high rate of forced outages, and generation units that are often tech logically outdated are requiring a reliance on very expensive fuel. are you aware of some of those problems and are you taking steps to address them? >> senator, several of the last few you mentioned were covered in my remarks. we do have maintenance issues with our generators. we do have environmental compliance issues with our generators. and if they're not able to be run for environmental reasons, they have to be shutdown. if our generators are not up to snuff maintenance-wise then we do have to run a generator. >> my time has expired. thank you. >> thank you, senator lee. senator huroana. >> thank you, madam chair.

question for mr. alexander. in a may 6th article "the new york times" the commanding general of the u.s. corp of army engineers was quoted as saying that prior to puerto rico to pu corp had never repaired an electrical power grid of this magnitude as part of a disaster response and could not predict the assignment from fema to restore the grid. do you believe that the corp should be tasked with grid repairs in future natural disasters beyond the routine task of bringing in generators? as you said your immediate mission was to turn on the lights. so should the corps be able to do more than just turn on the lights like the situation that happened in puerto rico? >> thank you, senator. you know, the corps is traditionally has just done the temporary emergency power generators. this was a new mission set. we have done some grid work in iraq and afghanistan but

certainly nothing to this extent. it's not a corpe, c-o-r-e, competency of ours. if it is made, then we would have to train our personnel and be resourced adequately to be able to execute that mission. a lot of this was done on the fly, if you will. we were able to get contracts in place quickly under federal acquisitions. >> so you say the mission to expand the corps is not yours. whose decision is it? the congress? >> well, the determination for the grid restoration for the corps to end at midnight may 18th that decision is by fema. we're there under the stafford act authority and under the associated resource. we run out of money on the 18th

and we run out of authority. i will tell you based on a statement made earlier, you know i would be remiss if i didn't say, you know, the thousands of corps engineers employees and military that have deployed to serve the citizens of puerto rico, it's not in our culture to walk away from a mission when it hasn't been fully accomplished. we follow orders -- >> yes, i understand. and i know that fema was on the big island right now. this is not denigrating anything fema is doing, but puerto rico which is very unique island nation just as hawaii is, whether there should be some greater flexibility under the stafford act to allow you to do more and to have more training, and of course depending on resources provided. >> senator, if i may answer this question. i do not believe that the corps should be focused on emergency

restoration for power grids as an expansion of their duties. the corps was a mission assign bide fema because prepa did not call for mutual aid. the standard within the industry is that any utility whether it's an eei or epa, they call for mutual aid and call for resources across the united states and canada to restore events. and so but for that failure to call for mutual aid, that is what resulted in fema mission assignment in the corps to undertake the restoration component. so had the process worked as designed and the reason why the general and i indicated in his article that it was the first time in my nearly 30 years in working in industry it was the first time that -- >> so this is responsibility of prepa to have a call for that mutual aid. and so mr. higgins has somebody

rectified this mission? >> senator, we did eventually call for mutual aid. at the time hurricane maria hit puerto rico, a lot of the utilities and the companies that would be providing mutual aid were essentially busy in florida and texas. before that after irma prepa had hired certain contractors to help in the restoration process. and the mission for the corps as i remember because i was there was assigned because they put in for the governor and asked him to sign it so we could have energy in 40 days. so it's a little more complicated than narrated before. >> i'm not sure that's accurate. >> i was there, sir. >> as was i. >> so obviously there needs to be more coordination because we can expect various weather conditions to be hitting simultaneously in all parts of the country and our territory, so i think this is something that needs to be resolved.

>> just for the record, the request for mutual aid came on october 31st. >> and the hurricane hit when? >> late september. >> september 20th, and the contract is within five days. >> so that sounds like an area for rectification. i'm running out of -- i have run out of time. i'll submit further questions relating to the flexibility we provided under the stafford act. >> thank you, senator harona. and i will share one of the impressions i had when we visited less than a month after the hurricane hit was the difference between the u.s. v j virgin islands and puerto rico. one had teed things up so that mutual aid assistance was going to be there in anticipation of the disaster, and literally on the day after there were crews coming from -- from the

continental united states into usvi to help with just the debris cleanup. but the decision not to act -- not to act for a full month afterwards i think was one of those -- one of those decisions where you look back on and say we could have -- we could have seen aid. we could have seen a different effort in terms of what could have come to puerto rico more readily. a lot of money quarterbacking that goes on. but i do think that very clear example of one place being prepared in anticipation of a disaster and another hoping to get lucky, and they didn't get lucky. senator king. >> thank you, madam chair. first i want to thank you and

senator cantwell for arranging this hearing on this important topic and acknowledging the role that i believe senator nelson played in trying to encourage us to work on and look into this problem. i know that he's earned a great deal of leadership on this issue. i'm a little unclear. we now have 98% restored. does that mean the system is all rebuilt and have we rebuilt the old vulnerable system? mr. alexander? have we gone beyond building a new system? in other words, are we patched up to work for now, or have we precluded the opportunity to build an entirely new and modern system? >> well, sir, our mission wasn't to build a modern resilient system. our mission was to do the interim measures to get power restored. and in that department of energy has been supporting us. i think the longer term

resiliency you mentioned for the department to play a hand in as well as prepa. the notion that our chief of engineers would say puerto rico would have power in 40 days, here assign this, it's the first time i've ever heard this. our chief is very clear on expectations and when power would be established, the different dates, the different percentages. and it was not consistent with what i believe the governor unilaterally declared, which we never agreed was feasible. >> so we've got the system up back and running, and my question is have we gone by the moment when we built a different kind of system? who's in charge? who makes the next decisions about what the system's going to look like? i asked that question the last time and i'm still not sure i know. who will make the decision as, for example, to go to a more distributed system as opposed to

the current base load diesel plant and wire across the aisle? >> senator, regarding how the instructtu structure for generation is conducted in puerto rico, that is policy choice that's handled through the legislative process, through the process at prepa. >> before we get to funding, i want to know who's going to decide do we maintain the current base load long wire system or do woe go to a different kind of system? is that prepa? >> as in any state it is the government through its legislative process in discussions -- >> no, that's not true in my state. the utilities make proposals that the public utilities commission approves them. the legislative doesn't design the grid. >> in puerto rico prepa is subject to certain legislation.

that is why we want to transform prepa so it is completely disconnected from the legislative process and it can look like a utility in the mainland. >> mr. higgins, do you have the authority to start to redesign the system? i've got a very limited amount of time. >> i believe through the h auspices of the integrated planning process and the initiatives that have been undertaken, providing longer term funds and opportunities to make the grid more resilient, we can do exactly what you say. we can figure out a better way to do it. >> what's the price of electricity today? >> around 20 cents a kilowatt hour. >> in my state we're building a 50 megawatt solar project. this is in the state of maine. our costs are well below 20 cents, and it's competitive. i just heard last year we're down to 6 cents a kilowatt for

solar. why isn't this the natural response in puerto rico? why are we doing 2% renewables in a state with one of the great solar resources in the history of the world? >> senator, i believe it's fair to say that's probably where things are going to go, but that has to be taken through a process that everybody buys into, properly funded, a plan made for how we get rid of the old generation, where to locate the solar, how to put individual and distributed solar projects around, how to bring perhaps liquefied natural gas to the island so we can be cleaner. >> and i get back to my original question. who's going to decide what this new grid is going to look like? >> i believe it's going to be my decision subject to the oversight of the prec and through the auspices of the

oversight board. >> and i understand there's discussion of divesting generation from transmission which has happened in lots of places including my state. who will regulate the wires? i understand that will be a publicly owned company. will there be a regulator of had wires and distribution company? >> yes, the energy commission will continue to be the regulator. >> and the wholesale production of energy will be unregulated up to competition? >> no, sir. that would be subject also to regulation a regulation to -- >> i hope we don't lose sight of the big picture that puerto rico could go from a challenged electrical system to a world leader given the natural assets

that the island has and the plunging -- solar prices have plunged 80% since 2010. enormous opportunity. i look forward to working with you to help seize those opportunities. thank you, madam chair. >> thank you, senator king. >> thank you for holding this hearing to reevaluate the progress made and certainly lessons learned in addressing puerto rico's energy needs and others nearly six months following a natural disaster. like others i was troubled to learn that prepa had contracted with an energy company although based in my home state with minimal experience. while i understand the need to move quickly given prepa's and the island's financial state it is equally as important these quick decisions are made with the best interest of rate payers and taxpayers. mr. vega, what kind of oversight

is in place with respect to prepa's finances and the other part of that question. in your view does prepa have sufficient internal controls in contracting expertise? >> so following the contracting issue that you alluded to, senator, the governor instituted a limited receivership over the contractorship in prepa. it's called the ocpc, the office of contract and procurement. and it has effectively conducted its oversight of the procurement process. we have to submit those contracts also to the fiscal over sight board. up to this date they have not denied those contracts to the fiscal plan. those contracts when they are to be reimbursed by fema are also now subject to a pre-audit and that has also been conducted successfully. regarding prepa itself, it is

subject to fiscal oversight by state authorities. and it is subject to the oversight by the fiscal oversight. >> when were those additional controls put in place? >> sorry? >> when were those additional controls put in place? >> i don't remember the exact date but i believe they were in october or november. november, yes. >> and had they been in place before you think it would have prevented this? >> i think what we're learning from what we've seen in the usvi, maybe hawaii and other islands, we would implement best practice like conducting rfps and activating mutual agreements before hurricane season. the usvi is subject to more hurricanes than puerto rico had been historically. we had remaining resource from the mainland. the usvi is much smaller than puerto rico. so bringing resources to the

island was much harder. so we do have to do work on our emergency planning. >> mr. higgins, prepa has had serious problems with debt and mismanagement. given the disaster situations will customers be able to pay for the service? >> senator, i'm not sure i exact ly understand your question. is it about the rates? >> yes. >> we're some distance on the final decision how prepa will be restructured and taken to the bankruptcy judge, if you will, and how all the different contracts and all the different activities of prepa. we now have a certified budget, and that will guide us. and that certified budget will imply some rates that will have to be submitted to mr. roman's organization for approval.

so we're in the process. the goal of many of the activities that are being undertaken inside the entity now are to reduce the cost pressures and reduce the cost so that there's less upward pressure on the rates. so i think the bottom line is with the federal help that we're getting and with cost control measures under way, and with an adequate set of solutions to the many, call it contractual problems we have, the rates are going to end up being fair and acceptable to the customers given that they're already too high. and they will need to come down over time. >> so in your written testimony you mentioned your concerns about prepa having only two months of operating expense in liquidity. how can this be addressed? >> in the short term we need to do a better job which we're trying to do in collecting from our customers in realtime. we're only able to get about 80

perls of t80% of the customers billed new. the substations in many cases, a large portion of them are still out of service. that will help in getting the bills out and the cash flowing in which is now about $50 billion a week. that will help a lot. and the continuing support for bankruptcy court from loans that will come from the commonwealth of puerto rico, actually who we borrow from, will help us to bridge through. we'll be back asking for more if we need it in the next few months of the fiscal year. >> thank you, chairman. >> senator camp. >> thank you, madam chair. i apologize for not being here early. this is an important hearing and certainly appreciate all the witnesses being here and the attention to detail. mr. higgins, it's good to see

you. i know we fought another battle together to make sure the taxpayers got a fair deal after all the market negotiation. i have to say this recent run up in debt securities where the hedge funds are profiting off of this is some of the frustration that at least we were concerned about before. and to me, really it's shameful. we're trying to get something done here at taxpayer expense. but we'll save the -- we'll save this to a different oversight hearing about that operation. but i did want to go to -- i did put out a larger statement that i won't go into now. but mr. walker, i wanted to go back to -- i know some of my colleagues while i was sitting here were asking about the blackout condition. what was the main cause of that? >> based on the information we know and when that happened, working with mr. higgins, the

thing that i think people neglect when looking at it is the system is not in its normal state. there's two transmission lines that goes from the south to the north. one of those lines is out and being worked on, which places the majority of the north-south corridor basically relying on that one line. and the relays are set and designed to operate with the system in basically its normal state. the system is not in its normal state for a variety of different reasons including that transmission line that they're working on. and it's surmised and i think mr. higgins and his team has done more, and i know he's been working with folks from nipa, relay experts to look at it details. but it looks like there's an overtrip mechanism or overtrip of the relays based on the

abnormal state of the grid and if you want to add anymore. >> i think assistant secretary walker's comments, senator, is very appropriate. that the grid is very weak right now because a number of lines are still out. but notably one of the main transport lines to take power from the south to the north. when an incident occurred that caused a protective action to start on an adjacent line, the way the relays were set, which was probably rights for the normal system, caused the entire -- an entire set of lines to trip off. and then you sedly huddenly had mismatch, and an electrical system can't handle a mismatch for long and therefore everything started to trip. that's just the way. it protects the system by

turning things off before they're damaged. >> was there something that was originally fixed or reset? >> no, not to my knowledge. >> so this didn't have anything to do with white fish? >> the issue starts with not enough generation in the north and too much in the south. and then the second thing that when the grid is in a bad condition, which it is right now, until that second line is built then you're vulnerable to almost any kind of incident. and then third we really have to look at, and this is what the department of energy is currently helping us with as with the nipa relay and protection experts, are there better things we can do to operate in these abnormaliti conditions that exist rights now? so we're getting help on all these fronts. >> to the proposal and changes to it, to me it would put -- the

reforms, i don't know that any utility operates this way in the united states. basically considering what naruqe recommends as an energy commission. do you think this will make us less or an effective independent regulator? >> ma'am, that's not an area the corps usually delves into, so i don't have an informed opinion. >> mr. higgins, do you have any comments. >> as a rescipient, i believe that nothing is better for a customer in the long run than a fair, firm, strong, well managed regulatory entity. and nothing is better for a utility. at the end of it day the customers get better rates,

better liability and the utility knows what the rules are and they operate by it. >> well, i guess that's why i would be concerned about having all of the appointees and then by one entity and then being able to ignore it as well-being somewhat concerning. but again that's something that we will have to, you know, keep our eye on and watch carefully for the future. so my colleagues were discussing distributed generation. do you think that we have enough in place now to focus on that given this load issue? >> senator, do you mean enough zriblt zrib distributed generation? >> enough in the framework, which my colleagues were asking. it's a viable question. we have this all the time as it relates to firc and it's

oversight. do you think there's a framework that exists in puerto rico to properly vet and incent distributed generation? >> i think more work will have to be done to make that work well in puerto rico. regulatory work, perhaps legislative work and certainly work within prepa. but we do need zribltdistribute generation, and it will be adopted i believe as a result of integrated resource process. >> will you get back to us on what legislative ideas you think we might need to make that reality? to me this is -- look, i know all of our colleagues -- well, actually i don't know what all our colleagues think. but i hear them and a lot of them, well, this tragedy happened and now we're going to build this most resilient grid. we basically got the grid up and running to best of our ability. now we know that hurricane season is going to hit again. and people are going to come

back to us and say wait i thought we built the most resilient grid. no, we put some money towards that. obviously we know distribution could help in the reliability of this. the clarmhairman and i want to with our own grid. but i think the key thing for us now in puerto rico is to make sure that the regulatory process does allow for some distributed generation that would help us with resiliency. and so if there are barriers to that, i certainly want to know, and i would think some of my colleagues would as well. >> senator, i do not mean to imply any federal actions needed. mr. sabrino talked about several initiatives in puerto rico about policies. and that's the kind of thing that might be needed to really make this work. >> all right, great. thank you, madam chair. >> thank you, senator cantwell. a few more follow-up questions here. mr. walker, in your testimony

you mentioned the report on the energy resilience options and potential solutions for the grid. you said it's nearly complete. when might we see that >> so the final draft was done on the 30th. it's going through final edits and we'll be presenting the report at the next meeting of the undersecretaries from all the responding agencies. which i believe is next wednesday and at that point we'll be distributing, that report. >> we'll look forward to that. you also mentioned the talking about microgrids. the national labs work through the microgrid design tool. and you indicated in your testimony here this morning that there were, you had identified some key locations. can you share with us what ear looking at?

and probably as important as where they are, is whether or not these microgrids have the support of the local folks there to use the land, and basically are signed on to the fact of having this opportunity, as opposed to obtaining power from central generation. the focus on microgrids is diverse. our initial work on the microgrids was with pridco, the puerto rican industrial development corporation, which owns 200 industrial pieces of property throughout the island. we were working with them to help facilitate providing better power quality for a number of the industrial customers. particularly those that were out of power to insure that the economic vitality of the island remained intact while we were going through the emergency

restoration component. in addition to that work being done we're working with pripa to identify the last mile isolated communities where we can do that and also with fema and the core, for those locations where we had placed generation for critical infrastructure and continue to have generation, those critical infrastructure locations. the idea being that by providing those -- microgrid capabilities there, the next time an event like murn maria, which is inevitable, is presented to us, there will be some level of normalcy that can be established. to help facilitate the health and safety of those on the island while we work to go through a restoration effort again. >> so in that vein there's been a lot of discussion about the smaller islands off of puerto

rico, vieques and culebra, you look at these and say these would be perfect opportunities for microgrid projects. maybe mr. higgins can jump in here. >> i can answer the question. so vieques and culebra are designed to be a microgrid. there's two undersea cables that presently feed vieques there was an rfp that went out for localized generation, deals generation that's presently there with work being done to develop the best microgrid strategy for vieques and culebra going forward. >> we don't have that strategy identified. whether it's wind, solar -- >> there's an rfp. i'm not sure if it's gone out or

going out with regard to seeking the best information from providers for those strategies. we will be, the doe will be working with prepa to evaluate the rfps, once they're coming in, we'll utilize the expertise within our national labs on microgrids. >> let me ask you for an update on restoring power to some of them more remote and more mountainous areas when, when several of us on the committee went to puerto rico and in october, we went out to barranquites. pretty isolated in the sense of where it was. and i'll tell you, you, you are left with impressions of conversations that you have with people at certain places and a conversation that we had with a young woman who was five months

pregnant, who was looking across this cut through the earth this ravine, that separated us, the road was taken out, but she was separated from the home that she had just bought. and had not been able to move in into, because of the damage that was done not to her home, but in order to access her home. and i was thinking about her just a few days ago. and the fact that okay, she's had that baby now, hopefully all is well there. but i have wondered whether she was ever able to get back to her house and whether her home has been restored to power. so can you tell me how things are looking there in those central mountain areas? and kind of what the plan is?

>> thank you for the question. you've identified the hardest part of this restoration and we're down to where we're getting less than or sometimes only one-tenth of a percent additional customers restored on any given day. that's not very many. there were days before when we would get a half percent or even 1%. i use that as an example because we still have about 1500 people out in the field working every single day to restore these distribution customers, that's in addition to the 300 or 400 working on the transmission lines which you can't put as many people on there are many situations like the one you describe. there's to question that that is going on. many of our employees don't have power because they live in similar places. so in addition to continuing to work down the lines and that's exactly what the crews do, we

also have an initiative to try to identify the ones that are really too hard to get to in any reasonable amount of time. for any reason and sometimes quite literally you're crossing a canyon, kind of like you describe or going through almost a jung until almost rainforest trying to refinish a line or put back up a line that is 1,000 feet long and down. we're making progress. not nearly as fast as our customers would like. not nearly as fast as we would like. but we're doing about as good as you can do in these very narrow, very tight areas where you almost can't even drive two trucks past each other. so we're continuing with you know, a lot of people working on it. i think we try very hard to you know, get there as fast as we can, it will never be satisfactory to the person whose power has been out for seven or seven and a half months. there's nothing we can do to make that better except continue to work really hard to try to do

it. >> can you tell me whether even in these area where is they have been without that power for now, seven months, the schools have been taken care of? they've got generators. so kids are, kids are in their schools, aren't they? >> please give me that assurance. >> yes, ma'am. school started and the schedule changed, a lot of work was done by upr, to make sure they don't lose that semester, but kids are back at school. kind of jumping around here. mr. sabrino, you, you have talked about the, the sale of, of the assets from preppa. but given the age, the condition of many of the electric power

plants, who's going to buy them? who do we anticipate is going to look at this and say, okay, here's a deal. >> that's a great question. what we're going to conduct is a market sounding process. what we see as a lot of the preppa generation fleet, part of their value is location, part of their value is operating them as new generation assets are constructed. we're open to have an outright sale and having intermediary agreements included also in this transformation process. >> so if i'm, if i'm somebody who is looking at this as an opportunity, again, having seen some of it i think in senator cassidy mentioned the condition of some of what we had seen, it was not exactly enticing. understand that there is an opportunity because of the

location, but is this something that decisions on this would, would be delayed as potential purchasers look to see what really is going to be stood up. there's so much that is, is at play right now. you've got, you've got fema and the corps who have been in place for these eight months now. you've got a transition, you've just got, you've got so much that is moving around. and a great deal of uncertainty, we're talking mr. higgins, you mentioned that part of your responsibility here is to, to make sure that you've got a grid that is, is resilient here. you're preparing for the next hurricane season.

assistant secretary walker has said that we're not in quote a normal state and that's why we saw this most recent blackout. so we're not in a normal state yet. hurricane season is as you said, a month away. the corps is leaving, you've got a transition that's going on that mr. higgins has said, you know, it may be i think you said uncomfortable or a little painful in the process. i have a hard time believing that anyone is going to view this as a real opportunity. to come in and purchase these assets. >> the process to, to concession or sell off an asset. what we're working on right now is getting legislative authority in puerto rico, through our legislature so that we can commence market sounding

interface with possible investors. what is clear is that whatever happens, there is going to continue being a transmission distribution service in puerto rico. the way that we have found in the past that services like those are depoliticized, managed adequately is if we contract a private operator or provide some sort of long-term concession. we're trying to avoid ways of falling into traps of the past and having a stronger customer-centric system. there are a lot of challenges, senator, we are not shying away from them. we have asked for help when we need that help and we invite that help to continue coming to the island. but it is part of our, the reality on islands in the caribbean, you have to juggle governing, you have to juggle what mr. higgins has to do in prepa, what jose has to do in the energy commission and what mr. massa has to do in the private sector. we have to continue our operations, but also face a

possible atmospheric events in the future. that's what we're working on to make sure that what happened before never happens again. >> i would also -- i think it's important, your comment about trying to depoliticize to the extent possible. i think we recognize you've got some pretty difficult history with the politization of, of your pair grid. and i think that has been a real drag on your ability to move beyond it and the genesis for many of the root here, many of the questions that have been presented. i'll ask you, mr. massa, to jump in here, but as far as the coordination, the working together that you've just referenced, how well are the governor, the board and preppa coordinating with each other on

the structure and on the operation? is one thing to sit here in front of a committee and share a table but do you believe that all of the necessary entities that must be coordinating to allow for better energy future for puerto rico? do you believe that that's happening? >> i'll ask each of you and also from the private sector side as well. >> should i start? >> go ahead. >> part of the, what we did when we, two months after the hurricane, to try to coordinate the recovery effort. we were following best practices in louisiana, in new york and new jersey, trying to centralize the coordination effort. the communication with fema. with u.s. army corps of engineers and other federal

stakeholders has been improving substantially. i think the command group. we ask discuss maybe differences of what happened in the past. but the truth is that federal officials and puerto rican officials have been walking on the ground, working together for months now and they've done great work. with the oversight board and preppa, preppa management. runs the day-to-day operation, we have to conduct fiscal and budgetary planning with the oversight board. and from the regulatory point of view, we have been working hard on improving relationships with the regulator to make sure that they are involved in the process. there was confusion, of what are the authorities between promesa, between the energy regulator and preppa itself. some of those issues have been litigated and resolved. we'll be working together to figure them out. that working together is

happening day to day and it is going to lead to more successful, a stronger and better puerto rico in the future. >> mr. higgins. >> my job is not to figure out what the policy should be, but to implement it and when the legislature and the governor, working with the oversight decide that the right future for puerto rico's electric utility is to go a certain way, my job is to get it as ready as possible to execute that plan. >> do you feel you have the clear direction now? >> yes, i don't have the exact direction, but i have a good general direction at this point and that's what's being debated in the legislature. >> and from the private side, what's the observation there? >> 1,500,000 meters is a huge market. the importance of the value is not the equipment for preppa, it's the market, a huge market.

we are having an energy, an international energy event in san juan. with dozens of companies interested in competing for this market. so there is going to be many competitors and there's going to be a huge appetite to be part of this. our energy committee is offered itself to provide a report from the politicice and the local commission in order to keep you informed. we will present every two weeks a report of how puerto rico is progressing. in this crisis. in terms of the relationship between the government and the agencies, then no pain, no gain, right? so i believe they're going through some difficulty. but as mr. sholino mentioned, they will be fine and things are

going well, so i hope that the conclusion will be a great for all of us in puerto rico. >> thank you very much. i'm actually encouraged with what i'm hearing today at the hearing. there's still work to be done. to delineate responsibilities, between all the different agencies. there are many agencies that have either an interaction between the decision making and there's overlap between them as well. we have issued i included that as part of the attachment to my testimony. protocols we established so we could work with the fiscal oversight and management board. so we can merge our responsibilities, so we don't step on each other's jurisdictions. and we have started conversations with mr. sobrino and the government. there is the policy starts,

starts within the government. starts within the governor and the late commonwealth legislature. delegates to different entities on the energy policies. the implementation of the policies. the responsibility that they are implemented relies on the energy commission and preppa to carry out those policies or whatever future transformation takes place. but i'm encouraged with what i'm hearing. i hope that the conversations keep happening that we're able to delineate we are all supposed to operate. for the benefit of the people of puerto rico. >> i had one more question and this was prompted from your comments mr. higgins, about this, rus national standard. that you mentioned for construction going forward. >> is that so is that standard what is being utilized now as we

are arthing under these new provisions within the stafford act that we just authorized recently? or how does, how does this rus national standard fit in? >> senator, what we did in restoring the system, so that people had power, was to put it back the way it was. which was designed to a lot of standards that had evolved over many years. but they were standards, but they were not standards generally adopted throughout the united states. but they were professionally competent standards, what we've now said based on part of the findings of difficulties encountered during the aftermath of hurricane maria, in having material issues, different voltages, issues with linemen who came from the other states to know exactly what they were

encountering, we have said we're now going to reconstruct the system and all new construction would be to this new national standard. which exists already. a national standard new to us called the rural utility standard. and that will identify all the things and practices that need to be met as we reconstruct things in the system. not simply put the power pack on, but as we rebuild the system to be more resilient, to be more able to with stand -- >> i understand all that. but what you've just said is we're rebuilding twice, we rebuild the first time to get things up and running and now we're going to improve the system. it was my hope that with changes to the stafford act that we would do it once. now i understand logistically, that the immediate need after an emergency is to get power back

to the people. so i guess i'm to ask you, mr. walker, with this in place going forward, with these rus standards. does this meet what you thought we needed to do with addressing the stafford act limitations. >> the stafford -- no, sir, the components of the stafford act get into being able to redesign in very short time and make those decisions to install. i, having spoken with mr. higgins about the rus standards over the last several weeks, you know, this is, an establishment of a standard that will be incorporated for new projects as they go forward. the resiliency that needs to be built into the system comes from a number of different things. standards are one component on a

going forward basis. but the design and how components are integrated, where the generation is, what type of construction is used on certain poles that are going to be subjected to certain type of winds during a hurricane? the ability for the system to disconnect itself and reaggregate itself through things like closers, things like that are not components by the rus standards. the rus standards will simply define things like standard pole sides and certain transform erz. one of the things that we straggled with when we were going through the emergency restoration component was the distearty of different types of votages and how they didn't respond up to how would it be on the mainland, when those crews

moved from the mainland to puerto rico or usvi. they can bring their own stock with them and replace it. in this instance, they could not because of the voltage standards in puerto rico. those are the things that when you look at brazil and see it on a more wholistics basis, there's a lot of prone opponents that go into it. design capabilities. utilities have a standard utilized by their company. this would be in step with moving towards resiliency. it's a wig island. 3500 square miles and there's lots of infrastructure. so it will take a period of time to transition through all of those components. but there are and we're working very closely with preppa. there are opportunities. resiliency and design and microgrids and out illization of different technologies to expand

the capability of the system. >> the materials we have sitting in the warehouses, whether they're in the core or whether they're going to be transferring over to you. do we, do these materials meet what you will need to match up with these national standards. >> as we change voltages and do other things over time we'll have to get new equipment to replace that. the things that have been brought back in are adequate to allow us to operate until we make changes in the future. if a voltage is set at a certain level for a structure, you can't use just any other piece of equipment. you must use one that is adequate for that voltage. many of the things we'll have to do in the future will require

different equipment to be involved. i will endorse what mr. walker said. resilience is not just about design, but design philosophy. operating philosophy. many things have to be down. that work is really just starting. >> the stuff that you're going to have receiving is material that you'll be able to use. >> we'll be able to use it it will take years and years for the system to be completely rebuilt. >> got it. i always hate it when i am asked the question, give yourself a grade on your performance. always much easier to be the teacher and give you the grade. this is national teacher week. so -- i'm going to ask you each to give yourself a grade. >> on how you feel the the rebuild, the response, seven months after, with regards to the disaster in puerto rico.

i'm going to make it easier on you and suggest that it not be a letter grade. but let's go back to elementary school. when where you're given an o for outstanding, an s for satisfactory or an n for needs improvement. or an incomplete, that's always a good one. mr. walker? we're going to start with you. >> o-plus, senator. >> mr. alexander? >> incomplete, our goal was always 100%. >> mr. sabrina? >> there's been a lot of tests, i think we've aced a couple. we've passed others, and then there's need for improvement. in some of those as well. there's partly -- at the end of the day. the overall test of rebuilding the island is still incomplete. but it is a process and there are a lot of tests.

>> good, mr. higgins? >> you didn't say work in progress was another choice, did you? >> needs improvement. incomplete. >> i think preppa's response has gotten better and better as time has gone on. i'm fairly new, so i can't take credit for any of that. for myself i'm at the needs improvement stage because we still have a lot to do. i think preppa has learned a great deal about itself and what its responsibilities are. i would say overall especially fairly early. needs improvement. beginning to get almost a satisfactory. but it won't be satisfactory until every customer is back in service. >> mr. morales. >> needs improvement. definitely needs improvement. i feel we have wasted two years. the commission was created in 2014. we did a lot. to get preppa up to, to a much better standard. to what it is.

definitely the hurricanes have affected the performance of preppa. we were in the process of establishing performance metrics for preppa before the hurricane. hit the island. now here, kpi is being thrown around, which i'm happy to see. but i feel we have wasted too much time. still are incomplete. and there still needs a lot of improvement. >> mr. massias. >> before maria, a very poor job in having a good electrical grid. yes, indeed, mr. roamen is right. the commissions contribute heavily in terms of standards in preppa. after maria, there's a lot of improvement to be done, in order

to complete this job. thank you. >> thank you all. i think, i think i would agree with what many of you have said that this is still a work in progress. i think for the people on the ground. it's clearly a work in progress and, and we worry that the progress has not been, has not been fast enough and it's unnerving i think to think that we've got the hurricane season that will once again be upon us and there is a vulnerability to the people in puerto rico, in, in the area. but today's hearing, our focus today is on puerto rico and how we're doing in our response. and i appreciate the fact that

we all recognize that we have, we have more to do in our various capacities. and appreciate the work that has gone into the response. it has been very complicated. it was extraordinarily devastating to be hit by two hurricanes and to be laid flat in many areas by the winds that came through. fortunately we don't see the level of devastation in these very populated areas too often. getting the level of coordination that needed to come together in response was an imperative and mr. walker, i think having been on the ground as you all were, were working, with not only a great number of agencies, but a great number of volunteers that really did try

to gear up, team up as quickly as possible, to provide for that response and that relief it is recognized that it was a considerable challenge. and you are doing so in an area where you had a system that was troubled to begin with. and so a whole host of issues that had just led to us having this second hearing now. within a six-month period following the disaster. know that we will continue as a committee to be vigilant in following this to insure that the resources that are necessary, that the coordination, that is required will continue. i do hope that we don't take the eye off of the ball until this is done. my fear has always, is always

after every disaster, that the news is there for a cycle. the relief efforts are there for a limited period of time and then we move off to the next disaster. to the next issue. and the people though remain, remain vulnerable feel forgotten. we're not going to forget the people of puerto rico. we're going to stay on this. and we need your leadership to do just that. so thank you for the time that you've given. i know that other colleagues will be submitting additional questions for the record. so hopefully you can be responsive to us as we continue to help in this, in this important area so thanks for what you do. and with that, we stand adjourned, thank you for your time today. >> thank you.