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The bulldozer that accidentally triggered an island-wide blackout in Puerto Rico last week was operated by D. Grimm Inc., a company that reports up to the Oklahoma-based firm Mammoth Energy Services. The same subcontractor was blamed for another blackout two weeks ago that affected 870,000 homes. Attempting to repair a downed wire on Wednesday, a bulldozer got too close to a live, high-voltage line, triggering a chain reaction that left most of the island’s 3.4 million residents without power. D. Grimm is a subcontractor hired by Cobra Acquisitions LLC, itself a subsidiary of Mammoth. First signed in October, Cobra’s contract is reminiscent of the one negotiated between the Puerto Rico Electric Power Authority, or PREPA, and novice Montana-based firm Whitefish Energy Holdings LLC, a $300 million agreement that generated international controversy. The utility’s contract with Cobra - a recently formed amalgamation of a handful of small mainland utility services companies - was less outrageous on its face than the Whitefish deal, and faced less scrutiny. Unlike the Whitefish contract, it was arrived at with the blessing of the Federal Emergency Management Agency, which Mammoth claims was in the negotiating room “every step of the way” and will ultimately reimburse PREPA for payments it makes to Cobra. Over the last several months, Cobra’s initial 90-day, $200 million contract ballooned to $445 million in late January and more than doubled again to $945 million about a month later, reportedly allowing it to source construction materials itself, rather than work through third-party contractors. While such generous contracts are an obvious boon for companies like Cobra, Freddyson Martínez, vice president of UTIER, the PREPA utility workers union, doesn’t see them as one for island residents. Wednesday’s blackout took place in the context of a concerted push from both the Puerto Rican government and the Washington-appointed Financial Oversight Management Board, or FOMB, to privatize PREPA, bringing its transmission and distribution capacity under private management and selling pieces of its generation capacity off to different bidders. With these contracts and more federal funding potentially up for grabs via privatization, Martínez predicted “there will be more Whitefishes and more Cobras - more animals of those species - lurking around trying to bite again.” |
