Puerto Rico’s main electricity provider can’t pay $1.13 billion due to creditors between now and July 1 without approval of an unprecedented debt-restructuring agreement reached at the end of December, according to Lisa Donahue, the agency’s chief restructuring officer, Bloomberg News reported today. The obligations are more than twice the amount of cash that the Puerto Rico Electric Power Authority, known as PREPA, has on hand, she said in a written statement to a Congressional committee meeting today on the island’s expensive and outdated electricity system. “PREPA will not be able to make up the difference with revenue from operations during this period,” said Donahue, who is a managing director with restructuring adviser AlixPartners. Donahue is appearing before a U.S. House committee that is examining the electricity system of the commonwealth, whose government defaulted on $37 million of bond payments this month. With about $70 billion of debt, more than any state but California and New York, Puerto Rico Governor Alejandro Garcia Padilla has said the island can’t afford to repay what it owes. Read more.
For more on today’s House Natural Resources Subcommittee on Energy and Mineral Resources’ hearing titled “Exploring Energy Challenges and Opportunities Facing Puerto Rico,” please click here.
Join experts in San Juan to discuss Puerto Rico's economic distress and other important cross-border insolvency topics at ABI's Caribbean Insolvency Symposium, Feb. 4-6, 2016. Click here to register!
For more news and analysis of Puerto Rico's debt crisis, be sure to visit ABI's "Puerto Rico in Distress" webpage.
