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Project proposes developing four highways through PPPs

By on March 2, 2017

SAN JUAN – As part of the China Puerto Rico Investment Forum, Public-Private Partnership Administration (PPPA) Chairman Omar Marrero presented Wednesday a variety of options to reach agreements between the government and the private sector to attract the highest number of Chinese investors to the Caribbean.

After offering details about the island’s reduced investment in infrastructure due to its fiscal crisis, Marrero highlighted the steps Gov. Ricardo Rosselló‘s administration has taken to boost the private sector, such as an accelerated process to establish public-private partnerships (PPPs) in transportation, electricity, aqueducts, among others (Act 1-2017).

 

Omar Marrero, chairman of the Public-Private Partnership Association. (Juan J. Rodríguez/CB)

Omar Marrero, chairman of the Public-Private Partnership Administration. (Juan J. Rodríguez/CB)

On transportation, the official emphasized the opportunity to develop PPPs with highway constructions, such as the one with PR-22. The proposal is for investors to consider building a similar project for PR-52, PR-30, PR-18 and PR-26.

This would not only reduce heavy traffic, but the investor, who would put the cash to develop infrastructure, would receive part of the government’s collections from toll fees. This measure has “a broad precedent in the market,” assured Marrero.

Likewise, investors could opt for a PPP with the PR-22 extension from Hatillo to Aguadilla, a project that will be available once the design evaluation and environmental analysis are completed.

Another opportunity to create PPPs lies in the development, operation, and management of seaports and regional airports. Marrero said that in the past few years there has been an increase in passengers who visit the island, both by air and sea, which is why these projects are at the “evaluation stage.”

In the energy sector, the official noted the possibility to develop a natural gas project at the Palo Seco and San Juan centrals. This would consist in building three to four combined-cycle plants, removing units 1 and 2 in Palo Seco and 2 and 8 in San Juan, and building a natural gas storage facility. Although the project “is consistent with the Energy Commission’s recommendations,” it is also “under evaluation.”

The PPPA director assured they could also develop natural gas plants in the Costa Sur and Aguirre offshore gasports.

As for renewable energy, the projects should produce 600 megawatts with PPPs similar to already existing wind turbine projects or solar panel farms.

See also: First China-Puerto Rico Forum Kicks Off

Before his presentation, Marrero told Caribbean Business that there could be PPPs to “reduce the Puerto Rico Aqueduct & Sewer Authority’s operational losses by integrating technology, or delegating several functions to the private sector,” such as billing and readings. Regarding infrastructure, he said there could be talks to improve the Valenciano dam.

The PPPA stressed that March 31 is the limit date for agencies to identify other areas to develop these types of agreements, which will be announced in the P3 Summit, on April 6 and 7.

 

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