U.S. Virgin Islands Power System on the Precipice

The Curious Circumstances Surrounding GE Unit 27

Recently, a series of power outages struck the islands of St. Thomas and St. John in the U.S. Virgin Islands (USVI). The reasons why were briefly covered by the local media, and focused primarily on the outages themselves. TPA decided to investigate, and the reasons why this most recent outage occurred are deeply troubling. In recent weeks, TPA has sent a letter to Congressional Republicans highlighting the Water and Power Authority (WAPA)’s disrepair and dysfunction despite billions in federal dollars flowing to the public authority. 

Unit 23 Malfunction

On June 24, an outage occurred due to a malfunction of a generator known as Unit 23 at the Randolph Harley Power Plant. Curiously, Unit 23 was a “standby generator,” and intended only to burn diesel fuel. Yet, WAPA substituted Unit 23 into the grid just a day earlier.

Why?

Unit 27 – the “GE” Unit

WAPA had been leasing the regular generator, Unit 27, from GE for $731,000 per month. WAPA reportedly missed significant payments to GE for their use of Unit 27, so GE turned the generator off. That’s right; GE turned Unit 27 off because WAPA was deliberately choosing not to pay its debts. According to WAPA CEO Andy Smith, the Authority owed “GE $5.4 million in past due payments that have not been made for the lease.”

Post-Outage: WAPA Pays GE

After the outage, WAPA moved decisively to buy GE Unit 27 to get the lights back on. GE only agreed to the purchasing deal for Unit 27 if WAPA would “accelerate approval” with the WAPA Board, necessitating the emergency meeting over the weekend to vote on the purchase. Interestingly, according to a WAPA press release, “the full funding for the acquisition is being supported by the Government of the Virgin Islands…”

Gov. Bryan Bails out “Independent” WAPA

Days before the power outage, Governor Bryan on a June 23 livestream dismissed suggestions that as governor he had a say on WAPA, stating, “It’s amazing, I always love when people ask me questions about the semi-autonomous organizations. They are run by boards, not the Governor.”

Despite strong assurances that WAPA is independent – and Governor Bryan has no responsibility over WAPA – Governor Bryan paid GE out of the central government’s coffer to make WAPA’s GE debacle go away.

The curious situation surrounding Unit 23 and the GE generator is a perfect example of WAPA’s current situation: mismanagement; dysfunction; refusing to pay its creditors; and expecting more handouts from Uncle Sam.