Bonds of Puerto Rico’s struggling power utility rallied to the highest in more than year as the agency and its creditors hammer out proposals to repair its finances, Bloomberg News reported today. Some debt of the junk-rated authority, called PREPA, gained after creditors last week submitted a $2 billion plan that would help diversify fuel sources to stabilize energy costs. PREPA expects to release its own proposal in the next two months, said Lisa Donahue, the agency’s chief restructuring officer. PREPA, banks, investors and insurance companies are negotiating contracts to extend loans and give the agency time to create a turnaround plan. Those agreements end April 15. The utility faces a $415.6 million principal and interest payment to bondholders July 1, according to New York-based NewOak Capital LLC. PREPA has $236.4 million in reserve, according to a filing by its bond trustee on the Electronic Municipal Market Access website.
