A small company in Whitefish has won a major contract to restore power to Puerto Rico following widespread outages from Hurricane Maria. Nicky Ouellet reports there’s some confusion over why the Montana company was chosen.
Whitefish Energy Holdings is relatively new to the Flathead Valley. The company was established in 2015. It doesn’t have an office and only lists two employees. Yet it won a bid with the Puerto Rico Power Electric Authority, or PREPA, to rebuild more than 100 miles of downed transmission lines following a near system failure after two hurricanes hit the island in September. The contract is garnering national attention. The Weather Channel had a story this week:
"Something fishy is going on in Puerto Rico, and it’s not just the name of the company involved. Whitefish Energy Holdings was awarded a contract to restore power to the island by the local power authority, but no one can figure out why," says the Weather Channel story.
I tried getting in touch with Whitefish Energy for a week. They referred to me to their public relations firm, but no one would give me an interview. So I called Ricardo Ramos, PREPA's chief executive officer. He spoke on the phone from San Juan.
"We knew there was going to be a direct hit, so we wanted as much resources as possible. Their name popped up on several fronts," Ramos says.
Ramos says PREPA received bids from a few companies in the lull after Hurricane Irma hit the island, but before Hurricane Maria made landfall. PREPA, which filed for bankruptcy in July, shortlisted to two, including Whitefish Energy.
"Just before hurricane Maria came, one of those two requested a payment guarantee that we thought was a bit onerous, so we decided to mobilize Whitefish [Energy]," Ramos says.
Whitefish did not ask for a payment guarantee. It signed a contract for an undisclosed amount to rebuild three to four transmission lines — or more than 100 miles of PREPA’s total 2,500 miles of lines. PREPA is open to expanding the contract in the future.
This is just one aspect of power restoration on Puerto Rico, the U.S. Army Corps of Engineers is overseeing other parts of the effort and recently awarded a $240 million contract to a Texas-based corporation for power restoration.
Usually after a catastrophic power outage, utility companies call a trade organization to initiate mutual aid. The American Public Power Association organizes a network of state and regional public power utilities to restore electricity quickly.
But PREPA never made that call. Ramos says that’s because his utility lost communication within and outside the island following Hurricane Maria’s landfall.
"Just a matter of the timing. Hurricane came, all communications went down, our servers were down," says Ramos.
By the time communications came back online, President Donald Trump had declared a major disaster on the island, and FEMA, the Federal Emergency Management Agency, stepped in. FEMA charged the U.S. Army Corps of Engineers to oversee power restoration work, which will be paid for using federal funds for the first 180 days.
It’s unclear why PREPA didn’t call for mutual aid when it contracted Whitefish Energy. Ramos says PREPA has paid Whitefish Energy about $2 million for its mobilization and work through October 11.
It’s now been a month since Maria hit. PREPA reports that it’s running at 19 percent of its power generation capabilities.
"Everything is working OK according to our expectations," Ramos says.
Whitefish Energy made a splash in the Flathead Valley last December, when CEO Andy Techmanski announced to news outlets he planned to build a transformer manufacturing plant at the former Columbia Falls Aluminum Company site. CFAC is currently a federally managed Superfund Site.
Techmanski told reporters he’d need the two local utilities to purchase about $20 million in pre-ordered transformers. Neither utility chose to do so.
Wendy Ostrom-Price is the public relations officer for Flathead Electric Co-op, one of the utilities Techmanski approached. She says Flathead Electric did contract Whitefish Energy to replace a transformer in the Libby area.
"We are scheduled to have that transformer delivered sometime before the end of the year."
Ostrom-Price declined to specify the dollar amount of that contract.
Contracting Whitefish Energy was a question mark at first, because the company is 51 percent owned by a Brazilian corporation, called COMTRAFO. Flathead Electric follows federal Buy American Act standards, meaning that at least half of the components in the equipment they use need to be built in the USA.
Ostom-Price says Flathead Electric did its homework.
"We know that over 50 percent of components used in this transformer and construction thereof is done in U.S."
Meanwhile in Puerto Rico, Whitefish Energy has been posting daily updates to social media. This one features CEO Andy Techmanski.
Whitefish Energy says it has 240 workers on the ground. A portion of those workers are subcontracted from Jacksonville Electric Authority in Florida. A spokesperson says Jacksonville Electric is committed to up to 90 days of work with Whitefish Energy.
Officials estimate repairs will last about six months.