"It's All Gone To Hell": Puerto Rico's Power Authority Just Lost Two CEOs In One Week

"It's All Gone To Hell": Puerto Rico's Power Authority Just Lost Two CEOs In One Week

Puerto Rico's electric power authority is effectively without a leader after the second CEO in less than a week resigned Thursday morning along with most of the board members.

Staff at the Puerto Rico Electric Power Authority (PREPA) have been left without a clear idea of who will be in charge or how to move forward with hurricane recuperation efforts and preparations for the current hurricane season, an employee who asked not to be named out of fear of retaliation told BuzzFeed News.

"In the last 48 hours, it's all gone to hell because nobody knows anything, period. Not even the [higher-up] directors of the company know," he said. "Nobody knows what's going on. Everybody here in the company found out through the press."

PREPA did not immediately respond to questions asking if day-to-day operations on power lines are continuing uninterrupted, and how plans to rebuild and strengthen the electric grid will be affected.

Rafael Diaz-Granados, who was appointed CEO on Wednesday by the PREPA board, resigned Thursday morning after public outcry about his $750,000 salary led Gov. Ricardo Rosselló to ask the board to reduce his pay. Diaz-Granados, who has been a board member since last year, was due to take up his post on Sunday.

Four of the other six PREPA board members resigned with him, writing in a letter to the governor that they saw Rosselló's actions as interfering with efforts to depoliticize the agency after years of nepotism, especially as its operations come under scrutiny from Congress in the wake of the controversial Whitefish Energy contract.

"The political forces in Puerto Rico have provided a definitive statement that they want to continue to control PREPA," the letter said. "When the petty political interests of politicians are put ahead of the needs of the people, the process of transforming the Puerto Rican electricity sector is put at risk."

The board members who resigned were appointed independently through a headhunting firm, leaving just the two members appointed directly by Rosselló.

"When [Diaz-Granados'] salary went public everybody went nuts over here saying, 'How can it be you have a company that is bankrupt, cutting salaries of employees … you are taking away incentives and fringe benefits and yet you find the money to hire someone for three-quarters of a million dollars?'" said the PREPA employee.

But, he added, there is also a sense inside the company that qualified candidates who would do the job for less money are too politically connected to the government.

"The thing is those qualified people who could do the work for less money have some sort of personal ties to the government. That’s the problem right now," he said.

As the agency's internal turmoil continues, the power grid remains vulnerable — public officials say that even a storm much milder than Hurricane Maria could knock out the power grid again.

Up to 5,499 people on the island are still living without electricity after losing it during the hurricanes last September. Rosselló has acknowledged that as the island braces for another hurricane season, the grid is in worse shape than it was before Hurricane Maria.

And the upheaval at PREPA comes in the context of Rosselló's decision earlier this year to privatize the public utility, with the agency around $9 billion in debt. Rosselló's office did not immediately respond to requests for comment.

Walter Higgins, who was appointed PREPA CEO in March, resigned earlier this week for personal reasons. During his tenure, the agency had developed a plan to complete grid repairs, according to the PREPA employee who spoke to BuzzFeed News.

"There’s no clear direction of which way we’re going," he said. "We sort of had a plan with Mr. Higgins, we sort of had something laid out for us but right now we don't know what's coming, we don't know what the plan is, we don't know jack."

At a congressional hearing in May, then-CEO Higgins was asked about the agency's internal workings and whether he thought there was a corruption problem among its higher ranks.

"I don’t know enough about it yet to know that," he said, adding, "I can tell you this much with respect to PREPA. There are always going to be in an organization of 6,000 people something going on that shouldn’t be, and we are going to vigorously go after and investigate anything that’s not done the right way."