PREPA authorizes 100 MW battery storage contract in Yabucoa, but the deal now heads to the Fiscal Oversight Board

The Puerto Rico Electric Power Authority's (PREPA) Board of Governors authorized on Friday, September 25, an additional 100-megawatt (MW) battery storage contract with Yabucoa Energy LLC, as part of the accelerated procurement process that launched in September 2025 to select renewable energy and storage projects ¹. The deal is not final yet: because of its size and PREPA's fiscal oversight rules, it now moves to the Fiscal Oversight Board (FOMB) for review before it can be formally executed ¹.

The project is not new to those tracking Puerto Rico's energy transformation closely. Puerto Rico's Energy Bureau (NEPR) had already approved it with conditions on July 27, 2026, following months of review: a battery energy storage system (BESS) with 100 MW of power and 400 megawatt-hours (MWh) of capacity, running a four-hour discharge duration ²³. The installation will sit on land from the former Shell refinery in Yabucoa, in the southeast of the island, a roughly 50-cuerda site the government has sought to repurpose for energy infrastructure ².

Key numbers

The energy storage services agreement between Yabucoa Energy and PREPA runs for 20 years ². Grid interconnection costs are capped at $20 million: if the final cost is lower, contract payments to the company are reduced proportionally, and if it's higher, the developer can terminate the contract without additional penalty ². The exact contract price is confidential, but NEPR has confirmed it falls within the range of other approved storage projects in Puerto Rico, and below most of them ².

Before giving its approval in July, the Energy Bureau demanded several corrections: clarifying the "Site" definition in the contract, which contained an incorrect location reference, and removing clauses that allowed the battery's energy capacity to shrink progressively due to degradation ²³. The regulatory order requires Yabucoa Energy to maintain the full 400 MWh capacity for the entire 20-year term through component replacement or expansion, with any corrective costs borne by the developer, not ratepayers ². PREPA was also warned of possible fines under Article 6.36 of Act 57-2014 if it failed to complete the corrections on time ³.

This contract adds to a larger package: in May 2026 PREPA's Board had already approved around 22 contracts that would add more than 1,000 MW of additional renewable generation and storage to the system ⁴, part of the island's goal of installing 3,750 MW of solar power and 1,500 MW of four-hour batteries by 2035, on the path toward the law requiring 100% clean energy by 2050.

What this means for you

If you live near Yabucoa or in the southwest, this project doesn't change your bill or service reliability immediately: the Fiscal Oversight Board still has to complete its review, and the final contract has to be signed before construction can start ¹. But in the medium term, more batteries connected to the grid mean solar power generated during the day can be stored and used in the evening, when demand rises and blackouts have historically been more common. For the average customer, the takeaway is that fixing frequent outages doesn't hinge on one project, but on dozens of contracts like this one that move, one at a time, through a slow regulatory and fiscal process.

How to track it / Checklist

1. To check the status of this and other generation contracts, visit energia.pr.gov and search the NEPR Orders section for the Yabucoa Energy docket.
2. Follow joint press announcements from PREPA and LUMA on their press pages (aee.pr.gov, lumapr.com) for the date the Fiscal Oversight Board finishes its review.
3. If you live in the Yabucoa, Maunabo, or Patillas area, watch for possible construction job postings once a groundbreaking date is confirmed.
4. Don't change or cancel your rooftop solar or home battery plans while waiting on this project: it's a utility-scale system, not a residential subsidy program.
5. For immediate outage issues, keep using LUMA's existing channels (lumapr.com/outages) while this new storage capacity comes online, a process that takes months after the contract is finalized.

What's next

The next step is review by the Fiscal Oversight Board, which can take weeks or months and has final say over contracts of this size under PREPA's fiscal plan ¹. If the FOMB approves the deal, Yabucoa Energy would still need to complete the final interconnection studies NEPR required before construction begins ². This contract joins other battery and solar projects already at various stages of development in the south and southeast of the island, at a time when the Energy Bureau is separately weighing a 6.07-cent-per-kilowatt-hour bill increase, for which it summoned LUMA and Genera to a technical hearing on September 28. Both processes — new generation and rate increases — are moving forward in parallel, but through separate regulatory tracks.

Sources

1. El Nuevo Dia — A manos de la Junta de Supervision Fiscal contrato de 100 megavatios en baterias de almacenamiento
2. pv magazine Latinoamerica — Puerto Rico aprueba con condiciones un BESS de 100 MW / 400 MWh en Yabucoa
3. San Juan Daily Star — Energy Bureau clears Yabucoa battery storage contract
4. Metro Puerto Rico — AEE da paso a contratos para anadir mas de 1,100 MW de energia renovable y almacenamiento