[CERTIFIED TRANSLATION]

Puerto Rico Electric Power Authority

REGULATION GOVERNING THE GENERAL TERMS AND CONDITIONS
FOR SUPPLYING ELECTRIC POWER

SECTION I: INTRODUCTION
Article A: Legal Basis
The Puerto Rico Electric Power Authority enacts the Regulation Governing the Terms
and Conditions for Supplying Electric Power in accordance with the powers granted it
under Public Law No. 83 of May 2, 1941, as amended, the Puerto Rico Electric Power
Authority Act, and as provided in Public Law No. 170 of August 12, 1988, as amended,
the Uniform Administrative Procedure Act of the Commonwealth of Puerto Rico.
Article B: Purpose
The purpose of enacting this Regulation is to establish the terms and conditions under
which the Authority supplies the electric power service, the requirements that those
interested in obtaining and using same must meet; and the rights and obligations of both
the Authority and its customers. Its purpose also to establish and make provisions for
the penalties for customers who fail to comply with the terms and conditions established
herein, pursuant to the provisions of Public Law No. 170 of August 12, 1988, as
amended.
Article C: Provisions from Other Laws
The provisions of this Regulation are supplementary to those of any other regulations,
norms, manuals, codes, standards, technical correspondence, public policies, or
applicable laws in effect. A list of the current regulations of the Authority can be obtained
on their web page or at the Department of Corporate Studies and Procedures. The
Regulation Governing Rates for Electricity Service prevails over this Regulation.
SECTION II: DEFINITIONS
A. Feeder
The primary power supply circuit or primary distribution line. This is generally
comprised of a trunk emanating from the distribution substation, the branches
deriving from the trunk, and of their sub-branches.
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B. Puerto Rico Electric Power Authority (Authority)

Government organization created for the provision of electric power service
under Public Law No. 83 of May 2, 1941, as amended, the Puerto Rico Electric
Power Authority Act. The purpose of this public corporation is to provide the
people of Puerto Rico with efficient, reliable electric power service at the lowest
cost possible that contributes to their quality of life and that encourages
environmentally friendly socio-economic development.
C Horse Power
Unit of measurement to measure an engine’s output. One horsepower (HP)
equals 0.746 kilowatts (kW)
D. Available Capacity
When electrical installations are suitable for serving the load to be connected
without overloading he Authority’s electric system
E. Substation Capacity
Total maximum load value in kilovolt-amperes (kVA) that can be supplied by the
substation’s transformers without damaging or affecting their isolation.
Manufacturers of this equipment must list on the nameplate the maximum load
value in kilovolt-amperes (kVA) that each transformer can supply at nominal
voltage and frequency.
F. Connected Load
Total nominal capacity in horsepower (HP), kilowatts (kW) and kilovolt-amperes
(kVA) of all electrical equipment, apparati, devices and any other electricity
consuming appliances connected to the customer’s electric power system and
that use the electric power system provided by the Authority.
G. Contracted Load
The kilovolt-amperes (kVA) the Authority has available for a customer, as agreed
upon and specified in the electric power supply contracts for wholesale rate
customers. This load can never exceed the substation’s capacity.
H. Electrical Installation Certificate
Document provided by the Colegio de Peritos Eléctricistas (Electrical Trade
Association) or the Puerto Rico Electric Power Authority, in which the licensed
and board-certified engineer or licensed and board-certified electrical engineer
certifies, without a doubt, though his/her signature, that the electric facilities were
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done by him or under his/her supervision, in accordance with the norms,

manuals, standards, codes, technical correspondences, public policies, and
applicable laws in effect.
I. Customer
Any natural persons or legal entities that request, contract, and obtain electric
power service that continues to be supplied unless they submits a request to
cease service and provides access for said service to be disconnected.
J. Cogeneration
Producing electricity and useful forms of energy, such as heat or steam, used for
industrial, commercial, heating, and refrigeration purposes through the sequential
use of energy.
K. Lessor
A natural person or legal entity that leases one or several establishments to a
customer, at the Authority’s wholesale rate, for services that supplement or are
related to the main activity of an establishment that obtains its electric power
service through the main meter installed by the Authority under the
circumstances and conditions specifically established in this Regulation
regarding leased facilities.
L. Meter
Device or instrument used to measure and record the consumption of electric
power in kilowatt-hour (kWh). For wholesale rate customers, it also measures
and records electric power demand in kilowatts (kW) or kilovolt-amperes (kVA).
M. Inaccessible or Closed-off Meter
Any meter located inside or outside a structure without access to read it, check
whether it is working, connect it, or disconnect it because free access to the area
where it is located is restricted or impeded by bars, fences, or any other type of
impediment or obstruction.
N. Current
The flow of electric charge per unit of time through a conductor, measured in
amperes (A).
O. Demand
Average value of electric power measured in fifteen-minute intervals
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P. Maximum Demand
Highest demand measured in kilovolt-amperes (kVA) recorded by the meter in
fifteen-minute intervals during a billing period.
Q. Primary Distribution
The Authority’s system of lines that distribute power at voltages higher than 600
volts and lower than 38,000 volts.
R. Emergency
A condition or situation that results in or may result in interrupted service for a
significant number of customers and users in which there is a risk of damage
being caused to lives or property or anything else that, in the Authority’s
judgment, requires action being taken immediately.
S. Energy
The full integration of real power during a given period of time, measured in
kilowatt-hours (kWh).
T. Metering Equipment
Set of components and devices used to quantify the energy, power, and demand
in a circuit. This mainly consists of a meter and its base, current transformers
(CT) and voltage transformers (PT or VT), cables, fuses, and terminals for
interconnecting them correspondingly.
U. Power Factor
The ratio of real power to apparent power (kW/kVA). Mathematically speaking, it
is the cosine of the angle between the voltage and current in a circuit.
V. Force Majeure
Events totally beyond the control of the Authority or acts of nature, such as
storms, electric storms, earthquakes, tornadoes, floods, etc. It also includes, but
is not limited to, hazardous situations, fires, explosions, service interruptions due
to the acts or omissions of any other public authority or natural person or legal
entity, including sabotage and strikes.
W. Distributed Generation
Electric generators or inverters, protection, safety, interconnection equipment,
and related equipment needed to produce energy at a customer’s installation and
capable of operating parallel to the Authority’s distribution system.
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X. Electrical Installation
Set of electrical material, equipment, or items located at a particular site with the
purpose of utilizing electric power.
Y. Net Metering
Process for measuring and crediting the energy exported to the Authority’s
electric system by a customer generating energy using sources of renewable
energy, including, but not limited to, solar, wind, hydraulic, and biomass energy.
Z. Danger
Imminent risk that any harm to life or property may occur.
AA. Regular Billing Period
Period established by the Authority for reading and billing the service, which may
be on a monthly or bi-monthly basis. The Authority reserves the right to change
the number of days within these periods, or to establish new periods based on
reading and billing needs.
BB. Real Power
Real component of electric or apparent power measured in kilowatts (kW). One
kilowatt equals 1,000 watts (W).
CC. Electric or Apparent Power
The product of the voltage and total current flowing in a circuit as a result of the
voltage applied. It is simply referred to as “power” and it is measured in kilovolt-
amperes (kVA). One kilovolt-ampere equals 1,000 volt-amperes.
DD. Electricity Producer
And installation used to produce electricity that uses systems of cogeneration,
renewable energy sources, biofuels, or fossil fuels with advanced technologies
that meet or exceed the standards of environmental efficiency for emissions,
noise or discharges. These facilities have a capacity greater than the maximum
allowed under the Regulations Governing the Interconnection of Generators with
the Electric Distribution System. It includes the interconnection equipment at the
point of delivery for transmission to the Authority’s electric system.
EE. Point of Delivery
The point where the Authority supplies customers with the electric power they are
going to use. It is the place where the customer’s private system is connected to
the Authority’s system. The Authority determines the location of the point of
delivery, which depends of the type of service and customer.
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FF. Metering Point

The point where the metering equipment is installed to record the electric energy
and demand, as applicable.
GG. Resale
To sell, use, or supply to a third party, through payment, all or part of the energy
agreed upon when service with the Authority was contracted. The consumption
of electricity included in a lease agreement for use other than that contracted with
the Authority constitutes energy resale.
HH. Temporary Service
Electric power service that is provided for a definite time or while a condition for
connecting the service is being put into place. Service for a construction
project’s provisional facilities, equipment testing, or temporary use.
II. Electric System of the Authority
A set of elements adequately arranged and organized that are used and
necessary for producing, transmitting, and distributing electric power.
JJ. Substation
A set of electric equipment needed for the conversion or transformation of
electric energy from one voltage level to another and to serve as the link between
two or more circuits in an electric system. This set of equipment is concentrated
in or confined to a given area and can be installed in open air structures or inside
buildings. Substation equipment mainly includes the end of transmission or
distribution lines, circuit breakers, automatic breakers, bus bars, and
transformers. A substation also usually includes control and protection devices.
KK. Shared Substation
A private substation that serves more than one customer, which may include the
substation owner. These customers could be billed at different rates. The owner
is always responsible for the maintenance, repair, and replacement of all
substation components, including the safety of the facilities (padlocks, signage,
clearance, etc.).
LL. Private Substation
Any substation not belonging to the Authority, which can be single-phase or
three-phase at distribution, sub-transmission, or transmission voltage levels.
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MM. Submeter or Secondary Meter

An instrument or device that is installed by the Authority after the main meter, in
order to measure a lessee’s consumption of electric energy.
NN. Rates
Price structure for the electric power service adopted by the Authority and
approved by the Governing Board in accordance with the powers granted them
and pursuant to Public Law No. 83 of May 2, 1941, as amended, the Puerto Rico
Electric Power Authority Act, and Public Law No. 21 of May 31, 1985, as
amended, known as the Uniform Rate Revision and Modification Act, or any
other legal provision that may apply. The rates for the electric power service are
enacted as a regulation and they establish the prices under which the service will
be billed, depending on the type of client, the magnitude of the connected load,
and the voltage level at the point of delivery of the energy, in addition to the
requirements for applicability.
OO. Wholesale Rates
Rates applicable to non-residential customers with a connected load of 50 kVA or
more and whose voltage at the point of delivery is a primary distribution,
subtransmission, or transmission voltage.
PP. Pulse Card (KYZ)
Device that helps detect the meter pulses corresponding to demand and energy
readings.
QQ. Service Drop
The conductors, material, and equipment installed to connect the customer’s
electric system to the Authority’s system. It can be either overhead (external) or
underground (below the ground, in tubes). The service drop belongs to the
customer and extends from the Authority’s point of delivery to the building,
structure, or project that will be supplied with the electric power, except for
overhead secondary distribution services, which belong to the Authority and
extend from the post to the point of delivery on the first support secured to a
structure or concrete column.
RR. Transformer
Equipment used to decrease or increase voltage in order to distribute electric
power
SS. Current Transformer (CT)
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A metering transformer whose primary winding is connected in series to an

energy source (core) and induces the current that is to be measured or controlled
in its secondary winding. Its primary terminals are connected in series to the
electric line to measure a sample of a reduced current that is proportional to the
primary current. Under normal operating conditions, the CT measures between
zero and five amps. It transforms currents that are higher than the capacity into
current that is useable by the meter.
TT. Metering Transformer
A transformer that induces a voltage or a current in its secondary circuit in exact
and known proportion to its primary circuit, to be used with metering and control
equipment and protection devices.
UU. Voltage Transformer or VT, Potential Transformer or PT
The metering transformer whose primary winding is connected in parallel to an
energy source and induces a voltage in its secondary winding, which will be
measured or controlled. It transforms energy from a high voltage into the meter’s
voltage. Its primary terminals are connected in parallel to the electric lines, and
at the secondary terminals, a sample of reduced voltage proportional to the
primary voltage is measured. Under normal operating conditions, the PT or VT
measures from zero to 120 volts.
VV. Wheeling
The transfer of power produced by an electric company for distribution to a third
party using the Authority’s lines.
WW. Improper Use
An action, derivation, installation, connection, intervention, interference with, or
manipulation, etc., of the meters, installations, or service drops with the intent
and effect of preventing consumption from being measured or of reducing the
true measurement of electric power consumption. Improper use is also defined
as the unauthorized reconnection of an inactive meter to obtain service without
having requested it previously and without it being recorded. Theft of copper
from of any equipment, lines, etc., is deemed as improper use of electric power.
Additionally, invading easements designated for power lines on the property
where the customer, user, or unauthorized user uses the electric power supply is
deemed as improper use of electric power.
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XX. User
Person using the electric power service and whose consumption is recorded and
billed in the name of another person.
YY. Unauthorized User
Person who used the electric power service whose consumption goes
unrecorded.
ZZ. Voltage
The potential difference between any two points of the electric system, measured
in volts (V) or kilo-volts (kV). This potential difference can be measured between
two lines or conductors, or between one line and a ground. One kilovolt is equal
to 1,000 volts.
1. Secondary Distribution Voltage – Voltage of 600 volts or less
2. Primary Distribution Voltage – Voltage higher than 600 and less than
38,000 volts
3. Subtransmission Voltage – Voltage of 38,000 volts
4. Transmission Voltage – Voltage of 15,000 volts or more
SECTION III: GENERAL PROVISIONS
Article A: Rate Structure
The electric power system in the Commonwealth of Puerto Rico is an integrated one;
therefore, the rate structure is uniform in both urban and rural zones.
Article B: Applicable Rates
The electric power service is provided and billed under the applicable rate established by
the Authority and depends on the type of client, the magnitude of the connected load,
and the voltage level at the point of delivery of the power. Whenever the conditions of
the service varies and the Authority determines that the rate under which it is being billed
is no longer applicable, the Authority notifies the customer of its determination in writing
and the service shall start being billed under the new applicable rate thirty (30) days after
the notification, unless the customer submits a request to be dropped from the service
and provides access to have the service disconnected prior to that date.
Article C: Purchasing Electric Power
The purchase of electric power and the corresponding related services for all rates and
contracts is established in accordance with the provisions of this Regulation and any
other disposition or regulation adopted by the Authority for this type of service, the
current regulations on planning and zoning, and applicable laws.
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Article D: Wheeling System

Participants in the wheeling system are governed by the terms and conditions
established in their respective contracts, the applicable laws and regulations, and the
provisions set forth in this Regulation.
Article E: Request for Service
Any natural person or legal entity can request, through any means authorized by the
Authority, any of the services it provides. The customer is responsible for ensuring that
the Authority received the request, and the date of said request is deemed the date of
receipt.
Article F: Notification of Defects
Customers are responsible for notifying the Authority as soon as they notice any defect
or irregularities affecting their billing or service.
Article G: Employee Restrictions
No Authority employee is authorized to ask the public for or accept any type of
compensation for their personal benefit for any services rendered.
Article H: Authority Regions and Districts
To provide its services, the Authority administratively divides the island into regions and
districts and determines their geographical area and their jurisdiction.
Article I: Personal Property
For the purposes of this Regulation and applicable laws, electric power is considered
personal property. The improper use of electric power, in any of its forms, constitutes
misappropriation, of such personal property and a violation of the provisions herein.
Therefore, any natural person or legal entity that uses electric power improperly commits
the crime of misappropriation, which is punishable as a misdemeanor, as established in
Article 192 of the Puerto Rico Penal Code.
Article J: Fines
Public Law No. 83 of May 2, 1941, known as the Puerto Rico Electric Power Authority
Act, as amended by Public Law No. 162 of December 7, 2009, establishes that any
natural person or legal entity that violates or induces the violation of any provision of a
regulation enacted by the Authority and/or alters the electric system in such a way that
true consumption cannot be measured runs the risk of receiving an administrative fine
issued by the Authority for no less than ten thousand dollars ($10,000).
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SECTION IV: SERVICE REQUEST

Article A: Processing the Request
Electric power service can be requested by calling the Customer Service Center
(residential accounts only), in writing, or in person at the commercial or local offices. In
the case of primary accounts (wholesale), service must be requested in person at the
Wholesale Sales Department in San Juan or in the commercial offices of the authorized
regions. Services for government, primary or secondary accounts must be requested in
writing (by mail or fax) with the Collections Unit – Government Accounts of the Collection
Center. The person making the request must meet all the requirements established by
law, regulations, codes, manuals, norms, standards, technical correspondence, public
policies, and rates that apply to the type of service requested.
Once the service requested is connected, the electric power supply contract is
formalized. Whenever it so determines, the Authority can grant a maximum of ten (10)
consecutive days following the request date to submit the required documents or
guaranties. In such cases, the person making the request will provide the information
needed to show evidence that the required permits or documents exist. The Authority
can bill the amount required as a deposit to guarantee payment of the service in the first
bill that is processed and send it to the customer. The customer has until the due date
indicated on the bill to make the required payment. Failure to pay the deposit or to
submit the required documents or guaranties within the stipulated term is sufficient
cause for the suspension of the service, at the Authority’s discretion. When customers
call the Customer Service Center for any service-related matter, they are notified that
their call may be recorded or monitored by a supervisor for quality control purposes.
Article B: Connected or Contracted Load and Voltage
The Authority accepts secondary distribution voltage requests when the connected load
is less than 50 kVA. When the connected or contracted load is 50 kVA or higher,
customers must select a wholesale rate and receive service for primary distribution,
subtransmission, or transmission voltage levels, except in the case of residential service.
As long as the connected or contracted load is 50 kVA or higher, customers must
provide the installations needed to receive the service and comply with all the applicable
norms and regulations.
Article C: Changing a Wholesale Rate to a Secondary Distribution Rate
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Customers paying a wholesale rate can request that it be changed to a secondary

distribution voltage rate as long as their metered kVA demand is less than 50 kVA for six
months prior to the request. Customers must also meet the following requirements:
1. Request the change in writing.
2. Provide the necessary installations and equipment required by the Authority to
supply and limit the secondary distribution voltage service. In such cases, the
Authority allows the existing substation to be used to provide service at
secondary distribution voltage.
Article D: Cost of Providing Service
The service is supplied at the point of delivery voltage whenever there are installations
and available capacity in the Authority’s system. The customers making the request are
responsible for paying for the costs of extending the electric lines, making any
improvement, installation, or carrying out any other work needed to provide the service
requested that has not been included in the applicable rate. In all cases, the
construction of new infrastructure must comply with the applicable laws, regulations,
codes, manuals, norms, standards, technical correspondence, and public policies of the
Authority in order to connect to the electric power system. The Authority or the
corresponding governmental entity determines the load based on the impact of the load
capacity of a project connected to the electric power system.
Article E: Minimum Billing
If the rate at which the service is supplied establishes a minimum contract time period or
a minimum period of advanced notice for termination thereof, and the customers
terminate the contract before said time or if the Authority must terminate it due to
customer breach of obligations, customers must pay the minimum billing charge
provided for under the rate up to the date the established minimum period was
terminated.
Article F: Customer Information
Upon initiating a service contract, the Authority will provide customers with written
information regarding the rate and the terms and conditions applicable to the service
requested, along with an explanation of how to read the meter.
Article G: General Requirements for Service to be Provided
Upon requesting service for any structure or premises that have not received service
previously, customers must submit the Use Permit issued by the Regulations and
Permits Administration (ARPE, Spanish acronym), the Permit Management Office
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(OGPe, Spanish acronym), or the autonomous municipality, as applicable, unless these

agencies exempt the person making the request from this requirement and the Authority
receives evidence thereto. Evidence of the Use Permit is also required whenever the
use of the structure or premises changes; whenever it has been vacated, or whenever
the service has been disconnected for over one (1) year, except in the case of
residential services (new housing units). Whenever the structure or premises is modified
for segregation purposes or to add business establishments, or under any other
circumstance in which it is provided as such in the applicable planning and zoning
regulations, evidence of the Use Permit is also required.
An Electrical Installation Certificate is required for any new service whenever the service
has been disconnected for over one (1) year or when the previously certified electrical
installation has been modified. In addition to these documents, the person making the
request must submit any other document required to give evidence of his or her
authorization to occupy the structure (Examples: Public Housing Projects and Housing
Co-ops) or to give evidence of his or her legal personality or capacity and authorization
to enter into contracts. Furthermore, the person making the request must pay or submit
the required guaranty, as provided in Section V of this Regulation.
Article H: Temporary Service
When temporary service is requested, the person making the request is responsible for
installing and dismantling the equipment and connections required for providing said
service. To receive this type of service, the person making the request must submit all
documents beforehand authorizing the installation, such as the Temporary Use Permit or
the Construction Permit or the No Objection Letter issued by ARPE, OGPe, or the
autonomous municipality, as applicable; the Electrical Installation Certificate; and any
other document required for the type of service requested. The No Objection Letter
issued by ARPE expires when the time period established is not used or when it is not
used within a one-year term, whichever is shorter. Also, it is the responsibility of the
person making the request to ensure that the structure or property is free of electrical
risks and is in compliance with the laws, regulations, codes, manuals, norms, standards,
technical correspondence, and public policies in effect. These services are billed under
the corresponding rate, according to the type of service.
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SECTION V: GUARANTIES FOR PAYMENT OF SERVICE

Article A: Guaranties
The Authority reserves the right to require of customers any guaranties it deems
necessary to secure the obligation of paying for electric power consumption. These
guaranties include a deposit, a bond from an insurance company certified by the Office
of the Commissioner of Insurance, or any other form authorized by law and accepted by
the Authority. Insurance companies that issue bonds to guarantee electric power supply
services must meet the conditions established by the Authority for such purposes. The
insurance companies must be certified by the Office of the Commissioner of Insurance
of Puerto Rico and accepted by the Authority. The forms or information regarding the
bond requirement can be obtained at any commercial or local office of the Authority.
Article B: Calculating the Deposit, Bond, or Guaranty
1. Residential Service:
The deposit or bond fee for a residential service is determined based on the rate
that applies to the service, as set forth by the Puerto Rico Electric Power
Authority.
2. Commercial Service:
The amount of the deposit or bond for a commercial service without any
consumption history is $90 per kVA, according to the load indicated on the
Electrical Installation Certificate multiplied by three. The minimum amount to
charge is $300. If the service is for the common areas of condominiums,
hallways, security cameras, staircases, or similar areas, and the load does not
exceed 3 kVA, the amount of the deposit or bond is $150. For existing business
that are transferred into the name of another customer without a change in the
use, the deposit or bond required is the sum of the last three bills. If the use
changed or modifications were made to the electrical installation, the amount is
the sum of the last three bills in the account history, or $90 per kVA, based on
the load indicated on the Electrical Installation Certificate, multiplied by three (3),
whichever is greater. When commercial service is requested for equipment
installed on poles or structures belonging to the Authority and that operate 24
hours a day (security cameras, communication equipment, etc.), the deposit fee
is $150. When commercial service requested is a temporary service (patron
saint festivals, circuses, amusement park rides, stages for shows, etc.) the
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amount of the deposit or bond to charge is $90 per kVA, based on the load
indicated on the Electrical Installation Certificate, multiplied by three, and the
minimum amount is $300.
3. Wholesale service:
If the service is new, the amount of the deposit or bond will be $90 per kVA,
based on the load indicated on the Electrical Installation Certificate, multiplied by
three. When service is requested for a business or industry with no prior
consumption history, the amount of the deposit or bond is the sum of the three
highest bills in the account history.
Article C: Guaranty Increase
1. The Authority reserves the right to increase the amount required as a guaranty,
or to require a guaranty if there is none, from all customers whose history in the
past twelve (12) months reflects one of the following conditions: two (2) or more
bills in arrears, one (1) or more checks that have been returned for insufficient
funds; a bank account that is closed or in a similar status; it has been determined
that there was improper use of electric power; or the service was suspended for
lack of payment. In these cases the required guaranty cannot exceed the
average monthly amount on the bills of the past twelve (12) months of service,
multiplied by three (3).
2. The Authority may also require a guaranty from customers who do not have it, or
increase the existing guaranty when its amount, as determined by the Authority,
is not enough to properly secure payment of the service. In these cases, the
amount required as a guaranty cannot exceed the average monthly amount of
the bills in the past twelve (12) months of service, multiplied by three (3).
3. When the Authority requires a payment guaranty from customers without one or
whose guaranty has been increased, pursuant to the criteria established in the
Article Three, it grants the customers affected by this determination a period of
twenty (20) consecutive days to present the new required guaranty. Failure to
meet this requirement is sufficient cause for the denial or suspension of electric
power service, whichever the case may be, as provided in Section XIV of this
Regulation. If appropriate, the Authority can also charge the required amount as
a service payment guarantee deposit on the next bill that is processed, and send
it to the customer. The customer has until the due date indicated on the bill to
make the corresponding payment.
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SECTION VI: DELIVERY AND METERING OF POWER

Article A: Point of Delivery
1. Electric power for customers with primary distribution, subtransmission, or
transmission voltage is delivered to a point pre-determined by the Authority along
the primary, subtransmission, or transmission distribution line, as the case may
be.
a. Customers construct the substation that connects to the Authority’s
feeders or lines at their own cost.
b. Customers who connect to a voltage of 38 kV or greater must provide the
means of communication, as required by the Authority, which must be
adjacent to the metering box where the meter will be installed with the
purpose of being able to read it remotely.
2. The point of delivery for electricity producers is determined by the Authority.
Customers are responsible for installing the equipment and lines to be connected
to the point of delivery. The terms and conditions for electricity producers are
governed by their respective contracts.
3. The point of delivery for distributed generation systems is determined by
Authority. Customers are responsible for installing the equipment and lines to be
connected to said point. The terms and conditions for distributed generation
customers are governed by the provisions established in the Regulation
Governing the Interconnection of Generators with the Electric Distribution System
and the Regulation for Establishing the Net Metering Program, as applicable, in
addition to their respective agreements with the Authority and this Regulation.
4. The point of delivery for customers with high energy consumption industrial
service is 115 kV or another voltage determined by the Authority. Customers are
responsible for providing all lines and terminal equipment to be connected at that
voltage at the Authority’s facilities.
5. The point of delivery for secondary distribution voltage is where the Authority’s
line is connected to the customer’s electric facilities.
6. The service drop belongs to the customer and goes from the Authority’s point of
delivery to the building, structure, or project to receive electric power, with the
exception of overhead secondary distribution services. These belonging to the
Authority and they go from the pole to the point of delivery on the first support
secured to a concrete structure or column.
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Article B: Metering Demand, Energy, and Power Factor

1. In its construction standards, the Authority establishes the placement of metering
instruments and equipment, based on the particular conditions for providing the
service requested.
2. The Authority provides and maintains, when established in the rate, the metering
equipment needed to measure demand and energy. The installation of this
equipment is the responsibility of the owner, customer, person requesting the
service, owners’ council, or condominium association.
3. It is provided that if the metering equipment fails or is defective, both the power
delivered and the maximum demand will be estimated by the Authority based on
the information obtained from the investigation. In such case, the estimates are
made for the period from the date on which it is determined that the equipment
failed to the date the situation is corrected. Customers must notify the Authority
as soon as they suspect a metering failure.
4. Customers must authorize the use of their establishments, lands, or facilities for
placement of the Authority’s metering equipment, as determined by the Authority.
5. The maximum demand for the primary, subtransmission, and transmission
distribution voltage is measured in kilo-volt amperes (kVA) or kilowatts (kW) for
billing purposes. Whenever demand cannot be measured in kilo-volt amperes
(kVA), it is measured in kilowatts (kW), and these are then converted into kilo-volt
amperes (kVA) for billing purposes by applying a power factor (PF) of 85%. At
the Authority’s discretion or at the request of the customer, the Authority can
install the equipment and conduct the necessary tests for measuring and
determining the real power factor, and this is used to convert kilowatts (kW) to
kilo-volt amperes (kVA). Whenever the test is requested by customers, they will
pay for the related expenses.
6. Transformation Losses – When a customer’s service is at a wholesale rate and
the metering equipment is located on the secondary side of the transformer, a
correction factor is applied to energy and demand consumption for billing
purposes to compensate for the transformation losses.
7. Shared Metering Information – Customers using wholesale rates can request the
installation of an electronic meter with the capacity to store metering-related
information and information from the pulse card in its memory, allowing them to
detect the demand and energy pulses generated by the meter. Customers
[CERTIFIED TRANSLATION] 18

always assume the cost of the card, as well as its installation, removal, or
replacement, and they are also responsible for acquiring and installing all
equipment and internal programming needed to process and interpret the card’s
pulses.
The card or the external equipment installed by customers to process or interpret
its pulses cannot interfere with the meter’s functioning. If the meter is damaged
due to the installation or use of the card or of the external equipment related to its
use, customers are responsible for the cost of replacing it. Information obtained
by customers is for their exclusive use and not for billing purposes. To request
consumption information through the pulse card, customers must have their
account up to date and sign an addendum to the main power supply contract.
Primary, subtransmission, and transmission distribution voltage customers must
provide, from amongst the options approved by the Authority, the means of
communication for the meter to be read remotely.
8. The metering of electric power used by customers participating in the Net
Metering Program is done pursuant to the Regulation for Establishing the Net
Metering Program in effect.
Article C: Meter Tests
The Authority reserves the right and may, at its discretion, inspect or test at any time,
any meter or equipment it deems need to be checked or tested. When customers
indicate that their meter is not functioning correctly and requests that it be checked, their
request is processed as a billing objection and investigation request as provided under
Section XIII of this Regulation. If the investigation shows that the meter does function
properly and the customers insist on having its mechanism tested, the customers pay for
the expenses incurred by the Authority to conduct such test when the results prove that
the meter is functioning correctly with the limits established in the American National
Standard Code for Electricity Metering, or applicable regulations.
Article D: Additional Supply Lines
When customers with primary, subtransmission, or transmission voltage wish to obtain
the greater safety and reliability provided by a single supply line through a single point of
delivery, they can request an additional line. The Authority evaluates the request and, if
it determines that it is feasible and that it does not affect their future plans, it can
authorize an additional supply line, provided the customer pays for all costs needed to
construct and connect the line. The additional constructed line and the original line are
[CERTIFIED TRANSLATION] 19

taken up to the established point of delivery or metering so that a single meter records
all the power inputs available to the customer. In cases of emergency, as determined by
the Authority, and in coordination with the customer, the Authority can supply the service
at a voltage other than that at the point of delivery, provided it has the available capacity
and only while the emergency lasts.
Article E: Meter Reading
The Authority reads the meters on a monthly and bi-monthly basis. The readings are
taken using any method adopted by the Authority that allows energy and demand used
by customers, as applicable, to be determined. The Authority has information explaining
how to read meters available to its customers and guides them on the methods it uses to
take readings. The bill sent to the customer must contain at the least information about
the reading at the start and end of the billing period, the dates and the days making up
the billing period, the meter constant, and the date of the next reading. The Authority
reserves the right to amend the bill format as it deems fit and to provide more
information to customers.
Article F: Consumption Estimates
When the Authority is unable to read the meter on the scheduled date for circumstances
beyond its control, including, but not limited to, inaccessibility to the meter or force
majeure, consumption is estimated. Consumption is also estimated when the
information about the meter reading cannot be used for billing as a result of problems
related to data transmission or communication systems and when it is proven that the
meter is defective.
SECTION VII: LINES, SUBSTATIONS AND ELECTRIC EQUIPMENT
Article A: Customer or Owner Responsibility for Property in terms of Lines,
Substations, and other Installed Electric Equipment
1. Customers supply, install, maintain, and replace all lines, substations, and
electric equipment installed from the Authority’s point of delivery to their
structure, space, establishment, or property. They are responsible for all
damages these facilities cause due to lack of maintenance, upkeep, proper
protection, or due to any other reason attributed by the Authority. For secondary
distribution voltage services in which customers do not want another customer to
be given service from the same transformer, customers must construct their own
substation. Customers are responsible for the costs related to acquiring,
installing, maintaining, and replacing the private substation.
[CERTIFIED TRANSLATION] 20

2. All lines, substations, equipment, and other facilities belonging to the customers
must meet the requirements established by the Authority in applicable laws,
regulations, codes, manuals, norms, standards, technical correspondence and
public policies. Customers, property owners, or their representatives are
responsible for maintaining the property to keep them in optimal conditions. If
after an inspection the Authority determines that there is a risky condition, the
provisions of Section XIV, Article D, of this Regulation shall apply.
3. When customers request or authorize the Authority to do work or to provide
service at times that are not business days and hours, the Authority must pay for
all the costs involved, except when the work is for reasons attributable to the
customers.
4. When customers choose for, or when it is required under the Regulation that the
service drop be underground, it becomes the customer’s private property and
they are responsible for its upkeep and replacement. The design and
construction of the service drop must comply with all applicable regulations,
norms, codes, manuals, standards, and technical correspondence in effect.
If there is a breakdown of a residential underground drop with grounded cables
and it needs to be replaced, the Authority evaluates the condition and the cost of
replacing it, so that the new drop complies with current construction standards. In
these cases exclusively, the Authority provides the electric material for the
construction of the service drop, such as cables and pipes, along with the work
related to disconnecting and connecting the drop to the electric power system.
The value of the Authority’s contribution shall not exceed fifty percent (50%) of
the total cost of replacing the service drop. When, in addition to the above, the
service drop runs along the property or land belonging to third parties, the
Authority carries out the drop replacement work and the customer is responsible
for fifty percent of the total replacement cost.
5. Customers, property owners or their representatives are responsible for the
protection and safety at private substations, and they hold the Authority harmless
of any accident or damage that people or property may suffer due to lack of
upkeep, protection, or safety there. These persons must install safety
mechanisms needed to prevent access by unauthorized persons. The Authority
will install safety devices in the cubicle where the metering equipment and the
main safety switch are located, when applicable. The customers or the owners
[CERTIFIED TRANSLATION] 21

are responsible for the damages to the metering equipment supplied by the
Authority due to lack of proper protection. The owner or the customer is
responsible for providing access to Authority employees at all times, for any
service-related process.
6. At the request of owners of existing private substations, the Authority may lease
distribution transformers to them, if they are available in its inventory, whenever
they need to be replaced due to damage and the owner is not able to acquire
one from a private supplier right away. The Authority establishes a monthly
rental fee for each transformer based on its capacity in kilo-volt amperes (kVA).
The lease agreement between the owner of the substation and the Authority is
valid for one year. At the end of this period, if the customer has not replaced the
transformer, the Authority shall charge for the entire cost of same. The Authority
reserves the right to renew the above-mentioned agreement.
7. At a shared substation, the owner or the Owners’ Council or the Condominium
Association and the customers who use said substation hold the Authority totally
harmless of any damage to people or property as a result of the lack of upkeep
or protection thereof.
8. At a condominium or a residential, commercial, or mixed multi-story building, the
primary service drop, substations, equipment, and other electric facilities are the
property of the Owners’ Council, Condominium Association, or the owner of the
building. They are responsible for maintaining the system that connects to the
Authority’s point of delivery and for completing any necessary repairs. Service
interruption resulting from failing to repair these facilities does not constitute a
breach by the Authority of its service contract with the affected customers, nor is
it responsible for the damages these customers may suffer due to lack of service.
9. In buildings that install and use generators as an independent source of electric
power reserve to supply their establishments or apartments, the owners, their
representatives, the Owners’ Council, or Condominium Association is
responsible for the operation and maintenance of the generator and for the
quality of the service provided by the generator. Customers must enter into a
contract with the Authority to establish the special applicable conditions for using
such generator, provided it meets the requirements established by the Authority.
Owners or lessees of establishments or apartments hold the Authority completely
harmless of any damage they may suffer as a result of the operation of the
[CERTIFIED TRANSLATION] 22

generator, and they relinquish any claim against the Authority that may arise from
its use.
10. Customers, property owners, or their representatives are responsible for
submitting a Electrical Installation Certificate to the Authority for the re-inspection
of any private substation and its accessories every three (3) years for substations
connected to a voltage of 38 kV or higher; every five (5) years for substations
connected to primary distribution voltage, or as recommended by the
manufacturer, whichever is less. The first certificate will be submitted three (3)
years, five (5) years, or as applicable, after service was connected, or, if the
service was previously connected, one (1) year following the effective date of this
Regulation. If this requirement is not met, the Authority can file a complaint
against the person who is liable and impose administrative fines, suspend
service in keeping with the procedure provided in Section XIV of this Regulation,
or both, at its discretion.
Article B: Responsibility of the Authority for Lines, Substations, and Electrical
Equipment
1. The Authority is responsible for supplying, installing, maintaining, and replacing
the lines, substations, and electric equipment installed up to the point of delivery
of the electric power for the customer. The Authority supplies, installs, and
replaces the electrical installations in its system in accordance with its capital
improvements program. When the person making the request must extend lines
or install electrical equipment in order to connect with the electric system, the
Authority is responsible for keeping up, maintaining, and replacing these lines
and equipment if they are transferred to the Authority.
2. In secondary distribution services, the Authority is responsible for providing,
installing, keeping up, and replacing the transformers and their accessories,
except when these are installed for the exclusive service of a single customer. In
such cases, the customer is who asks the Authority to receive exclusive service
from a transformer. For exclusive service, customers are responsible for the cost
of installing transformers and their accessories, in addition to paying a monthly
fee established by the Authority for renting these transformers to maintain their
exclusive use. In this case, the Authority is responsible for maintaining and
replacing the transformers. If the customer pays for the cost of the transformers,
[CERTIFIED TRANSLATION] 23

the above monthly fee does not apply, but the customer is responsible for
conserving and replacing them.
Article C: Right of Access
1. Customers are responsible for ensuring that the meter’s base is properly
identified and located in a spot that is accessible to Authority employees for any
service related purpose.
2. When the Authority determines that a meter has been locked away or is
inaccessible, it will request, in writing, that the customer relocate the meter’s
base or mounting to an accessible area, preferably on the front wall of the
structure.
3. The Authority will grant the customer a period of sixty (60) consecutive days to
carry out said work whenever the meter’s base or mounting needs to be
relocated. If the term granted expires without the customer having relocated the
base or mounting as required, the Authority can suspend the electric power
service pursuant to the provisions of Section XIV of this Regulation.
4. The Authority is not responsible for the damages caused to customers while they
are without service. Should customers fail to comply with the aforementioned
paragraphs, they will be charged all expenses incurred by the Authority to gain
access to the meter.
SECTION VIII: CONNECTED LOAD
Article A: Load Capacity
The demand cannot exceed the capacity of the meter’s base, transformer, or substation
through which customers receive service. Customers cannot make changes to the
installation or to the number of equipment connected which can lead to excess demand.
To make any change, customers must request and obtain prior written authorization
from the Authority and a revision of the Wholesale Electric Power Supply Contract, as
applicable. Customers are responsible for the damages caused by increasing the
connected load without prior authorization from the Authority.
Article B: Load Balance in Three-phase Services
Customers use electric power at all times; therefore, the load is balanced based on ten
percent (10%) between phases. In the case of unbalanced loads, the Authority reserves
the right to request that the customer make the necessary changes to correct the
situation. If the customer does not comply with the requirement, the Authority can
suspend the electric power service as provided under Section XIV of this Regulation.
[CERTIFIED TRANSLATION] 24

SECTION IX: CUSTOMER USE OF ELECTRICITY

Article A: Interfering with Metering Equipment
1. Meters and any other equipment or material supplied or installed by the Authority
are its property and it has the right to dismount, disconnect, inspect, repair, or
substitute such equipment and material whenever it deems necessary.
Customers and any other person not employed by the Authority are prohibited
from taking action, manipulating, or tampering with the metering equipment,
conductors, transformers, meter seals and rings, or any other item that forms part
of the installation by the Authority. When the Authority takes action with the
equipment at the request and in the sole interest of the customer, the customer
pays for the related costs.
2. For structures, establishments, or land belonging to or under the control of
customers, customers must make sure the Authority’s meters are not tampered
with, interfered with, or manipulated, and that no bypasses are installed at
service drops before the meters are installed. Customers are also responsible
for exercising due care, looking out for, and taking the necessary precautions to
protect and prevent undue damages to and tampering of the Authority’s property
installed in the structures, establishments, or land belonging to customers or
under their control.
3. Tampering with meters without prior authorization from the Authority constitutes a
crime of misappropriation under Article 192 of the Puerto Rico Penal Code.
Tampering with the meter also constitutes a misdemeanor as established in
Article 196 of the Puerto Rico Penal code, and a violation of the provisions of this
Regulation.
Article B: Responsibility for the Use of Electric Power
Customers are responsible for the use of the electric power from the point of delivery
onwards and the power cannot be used for any other purpose or place not specified in
the contract or in their service order, Use or Construction Permit, at the applicable rate
or this Regulation.
Article C: Accidents
In cases of accidents or problems in the equipment or material installed by the Authority
to provide the service, customers must notify the Authority immediately. Should any
losses or damages occur to the Authority’s property due to the lack of care or
[CERTIFIED TRANSLATION] 25

monitoring, or negligence by customers, they will pay all the costs for repairing or
replacing the damaged property.
Article D: Voltage Fluctuations Caused by Customers
The customer’s electric equipment is used in a way so as to not cause voltage
fluctuations or disturbances or other parameters of the electric signal of the Authority’s
system. The Authority can request customers to install the appropriate and necessary
equipment for maintaining the voltage fluctuations or disturbances within the fluctuation
limits of plus or minus five percent (5%) of the systems nominal voltage. If the customer
does not do as required, the Authority can suspend the electric power service pursuant
to the provisions in Section XIV of this Regulation.
Article E: Authorization to Make Changes to Electrical Installations
Customers must notify and obtain prior written authorization from the Authority for any
change to the electrical installations that may affect the quality of service the Authority
provides to the customer or to other customers receiving services from the same
facilities.
Article F: Prohibition of Electric Power Resale
1. Resale of the electric power agreed upon or contracted with the Authority by one
customer to another customer or to another person is prohibited.
2. The sale and charge of the electric power supplied by the Authority to customers
connected to its electric power system can only be done by the Authority.
Therefore, the Authority installs appropriate metering instruments at a single
point on the electric power service line.
3. If the Authority detects that there has been a resale of electric power, the
customer is responsible for correcting the condition within thirty (30) days from
the notification thereof.
4. If the matter is not corrected within the established timeframe, the Authority can
suspend the customer’s electricity service
5. The matter of resale can be corrected through the installation of a separate
metering system and the third party can contract service with the Authority at the
applicable rate and comply with the requirements established for the requested
service to be provided.
6. The Authority will make an adjustment to the customer’s bill to account for the
time the resale took place at the applicable commercial rate.
[CERTIFIED TRANSLATION] 26

SECTION X: SINGLE-METER SERVICES

Article A: General Provisions
Except as provided in the Electricity Service Rates Regulation and in Article B of this
Section, the Authority requires all natural persons or legal entities, their family members,
and commercial or industrial entities, or electric power users to contract same on an
individual basis and to install a meter for each service that measures and registers the
consumption of electric power and maximum demand, as applicable, for each billing
period.
Article B: Service through a Single Meter at a Single Wholesale Rate
1. At marinas, in office buildings or establishments for lease, and at hospitals and
hotels where one or several establishments are leased to lessees for services
that are supplementary or related to the principal activity, service can be provided
to the entire structure through a single meter (master metering) at a single
wholesale rate. At the request of the customer or developer or planner, the
Authority will approve this system when it determines that master metering
outweighs the benefits of individual metering, or that individual metering is not
practical. The customer is responsible for paying the Authority for the entire bill
submitted. The customer can recoup the fees using a method agreed upon in
writing with the lessee that is based on, but does not exceed, the per kilowatt-
hour (kWh) that results from dividing the sum of the invoice by the total kilowatt-
hours (kWh) used.
2. Customers are responsible for installing auxiliary meters or submeters to
measure the consumption corresponding to each lessee, subject to the terms
and conditions provided further on in paragraph 3 of this Section. Customers are
responsible for paying the entire bill sent by the Authority, regardless of whether
they recoup the sums corresponding to the cost of the service used by the
lessees. Failure to pay all or part of the bill submitted to customers by the
Authority is sufficient cause for the Authority to suspend electric power service as
provided under Section XIV of this Regulation, and in such case the Authority is
not responsible for the damages customers or their lessees may suffer as a
result of said suspension.
3. The use of secondary meters or submeters for recouping the cost of the electric
power supply service is subject to the following terms and conditions:
[CERTIFIED TRANSLATION] 27

a. Customers are responsible for requesting and obtaining authorization

from the Authority prior to the installation of secondary meters or
submeters.
b. All installations constructed to distribute the electric power registered by
the principal meter are the property and responsibility of customers, and
therefore they are also responsible for the maintenance thereof.
Customers must file an Electrical Installation Certificate issued by a
licensed, board-certified electrical engineer or licensed, board-certified
electrician with the Authority prior to the installation of the submeters.
They must also notify the Authority and file a new Electrical Installation
Certificate each time they add, alter, or modify said installations. The
Authority is not responsible for the losses or damages that may occur due
to defects in the electrical installations.
c. Secondary meters or submeters installed must comply with the standards
of ANSI C12 (American National Standard Code for Electricity Metering).
Customers must label these secondary meters or submeters with any
non-removable label or fixture that differentiates it from those belonging to
the Authority and place them in a spot that is accessible to the lessees,
and to Authority employees for reading and verification.
d. The Authority reserves the right to inspect the electrical installations or
equipment used by customers for their internal distribution system and
metering at any time. Within fifteen (15) days, customers must correct
any deficiencies or irregularities indicated by the Authority. Should
customers fail to comply with the Authority’s request, the Authority can
suspend the service following the procedure provided for under Section
XIV of this Regulation.
SECTION XI: IMPROPER USE OF ELECTRIC POWER
Article A: Investigating Improper Use
When a situation of improper use is detected, the Authority may report it to the pertinent
authorities. Customers or any natural persons or legal entities that have used
unmetered or unbilled electric power must pay for the cost of the investigation, of
eliminating the detected condition, as well as any fine that is imposed. Customers or
any users or unauthorized users who have improperly used the service are responsible
[CERTIFIED TRANSLATION] 28

for paying the Authority the amount estimated by the Authority of the unmetered or
unbilled electric power.
Article B: Notification of Charges
Whenever improper use is detected, the employees who detect it will gather the
evidence and correct or eliminate the detected condition. This information is notified to
the commercial office. The manager of the commercial office may file a complaint
against the customer, user or unauthorized user under the provisions of Public Law No.
170 of August 12, 1988, as amended, the Uniform Administrative Procedure Act. In said
complaint, the Authority can request that the customer, user, or unauthorized user be
ordered to pay the sum that is determined was consumed and not recorded by the
metering equipment. The administrative judge may also order the suspension of the
electric power supply if the customer fails to make the ordered payment. Customers,
users, or unauthorized users must pay for the administrative expenses as well as any
administrative fine that is imposed as a result of said process.
Article C: Improper Use that Jeopardizes the Safety of Lives or Property
If the improper use detected is one that jeopardizes the safety of lives or property and it
cannot be corrected or eliminated without service being suspended, or if the service has
been connected without there being a contract or prior request and it has not been billed,
the Authority will suspend service immediately. In such cases, if there is a contract to
provide service, the Authority will notify the customer right away of the detected situation
and the action taken. Customers may request a review of the Authority’s decision in
accordance with the procedure established in Section XVII of this Regulation. If the
customer corrects the situation to the Authority’s satisfaction, service will be restored
while a decision regarding the review is being made. The Authority will take legal action
against any person who does not have a contract with the Authority.
SECTION XII: PAYMENT FOR SERVICE
Article A: Customer Responsibility for Service in their Name
Each customer is responsible for the corresponding payment of all services provided in
his or her name. The responsibility remains in effect even when customers have stopped
using the contracted service or have vacated, sold, assigned, or transferred the property
to which the service in their name is supplied without having made a request for
termination of service and such service is used by another person with or without their
consent or knowledge. Customers must request the termination of the electric power
supply contract at least five (5) business days prior to the desired date, unless the
[CERTIFIED TRANSLATION] 29

contract stipulates for a longer term, in which case, the term provided therein applies.
Customers are responsible for providing access for service to be disconnected. The
request can be made in person at any commercial or local office, by phone through the
Customer Service Center switchboard, by certified mail, return receipt requested, or
through any other means accepted by the Authority. When the request is made in
person or by phone, customers must ask for a request number or a receipt and keep it
as evidence. The electric power supply contract remains in effect if the Authority cannot
disconnect the service on the desired date due to lack of access or because the
minimum effective term has not expired. When the electric power supply contract
ceases, any unpaid balance can be transferred to any other account that is billed in the
name of the same customer or that he or she uses in another person’s name. If there is
no objection pursuant to Section XIII of this Regulation, or if the payment has not been
made before the due date indicated on the bill with charge, the Authority may suspend
service, in accordance with Section XIV of this Regulation. The Authority can inform any
credit bureau of, or refer to a collection agency, any outstanding balance found on the
account when the electric power supply contract is terminated and the payment of the
final bill has not been received by the due date. Before referring the balance, the
Authority will verify that this balance was not objected to in a timely manner as
established in the procedure in Section XIII, or if it was done, that its correction was
accepted and upheld during the process. The Authority may also deny customers new
service, unless objection to the balance was made pursuant to the procedure
established in Section XIII of this Regulation, and even if a decision regarding such
objection has not been rendered, or if the decision was favorable to the customer. An
interest of eight percent (8%) per annum will be charged to any final outstanding balance
up to the date it is transferred to an active account, in which case the charges
established herein for active accounts will apply thereafter or until it is paid in full.
Article B: Responsibility for the Use of Non-Contracted Service
For anybody using electric power service that has not been contracted or that is being
billed in someone else’s name, the Authority must request that they enter into a service
contract in their name and that they meet all the requirements to do so. When the
service is billed in the name of one person and it is used by another, each party agrees
to make the full payment for the service entailed and for all obligations derived from the
service. When the person in whose name the service is billed is not the person paying
for said service, and the user does comply with the Authority’s requirement of
[CERTIFIED TRANSLATION] 30

establishing service in his or her name and does not meet the requirements to do so, the
Authority can suspend the service as provided under Section XIV of this Regulation.
Article C: Bills
1. At its discretion, the Authority performs the reading, billing and charging of
electric power consumption on a monthly or bi-monthly basis, or for reasonable
time periods it deems will provide better, more efficient service to the public. All
electric power bills or bills for any other service related to and authorized by this
Regulation or other Authority regulations must advise customers that they have a
certain term to pay for or object to any charge not previously billed and to request
an investigation. This term can never be less than twenty (20) days and the bill
must indicate the date said term expires and advise customers of the procedure
available for channeling any objection and obtaining more information on same.
Bills may be paid over the Internet, by phone through the Customer Service
Center switchboard, by mail, banks or authorized payment stations, automatic
direct debit, in the Authority’s commercial or local offices, or by any other means
approved by the Authority for such purpose. When there are overdue payments
on the bill, the payment must be received or reflected in the Authority’s billing
system no later than the due date on the bill. If the payment is made through a
bank account and it is not processed due to insufficient funds, uncollected funds,
closed account, stop payment, unauthorized signature, or any other similar
reason, customers must pay the amount owed, plus a twenty-five ($25) fee for
administrative expenses. This fee is also charged when customers pay by credit
card and then ask the card issuing bank not to process the payment, or in the
case of fraud. In such cases, customers lose the privilege of paying by credit
card. The return of a payment for any of the reasons listed above affects the
customer’s payment history and it is cause for suspension or revocation of the
privilege of paying by check or credit card and suspension of service for non-
payment. Not receiving the bill does not exempt customers from their obligation
to pay same. If they do not pay or follow the procedure for objecting to charges
established in Section XIII of this Regulation, the Authority can suspend service
in accordance with the provisions of Section XIV of this Regulation.
2. The Authority credits or debits the customer’s account for any amount collected
in excess or not collected for any reason, including but not limited to, defects,
irregularities, improper use, or errors, whether it be in the customer’s electric
[CERTIFIED TRANSLATION] 31

system, in the equipment related to the service or the installation thereof, in the
readings or the meter constant, in the applicable rate, or in the Authority’s billing
processes. The power to return or recover funds established herein is limited by
applicable legal provisions.
Article D: Calculation of Charge for Demand and of the Fixed Monthly Fee during
Irregular Billing Periods
When the billing period is irregular, the monthly charge for demand is adjusted on
wholesale accounts, if applicable. The fixed monthly fee per customer is also adjusted
in a way that neither the Authority nor the customer is adversely affected. To do so, a
base period of thirty (30) days is used for monthly billing and sixty (60) days for bi-
monthly billing, and the bill is prorated for the number of days of consumption.
Article E: Rate Changes
The Authority has the power under the law to establish new rates and make changes in
the existing rates for the purchase of electric power. When the new rates are set
following the procedure established by law, they apply to all active services and
customers agree to pay for the service at the new prices and to comply with the
conditions for them to apply beginning on the date the new rates go into effect, as
determined by the Authority’s Governing Board.
Article F: Late Fees
When overdue payments on the bill of any customer, with the exception of public
corporations and government agencies, exceed $1,000 or the sum of the last two bills,
whichever is less, an additional charge calculated at two thirds of a percent ( 2/3%)
monthly of the overdue amount is added on to the amount overdue at the time of billing.
To calculate this late fee, the Authority does not take into account current charges or
previously billed charges that are not overdue or that are under objection pursuant to the
procedure established in Section XIII of this Regulation and awaiting a decision
regarding said objection. This charge does not exempt customers from their obligation to
pay bills on time or limit the power of the Authority to suspend service for non-payment
pursuant to the procedure established in Section XIV of this Regulation. Late fees are
considered part of the bill, and should they not be paid prior to the due date, they are
added to any other overdue payments reflected on the account for the purpose of
calculating this fee on future bills. If partial payment is received, it is first applied to
unpaid late fees.
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SECTION XIII: PROCEDURE FOR OBJECTING BILLS, ADOPTED PURSANT TO

PUBLIC LAW NO. 33 OF JUNE 27, 1985, AS AMENDED
Article A: Request for Investigation or Objection of Bill
Customers can object and request an investigation of any charge reflected for the first
time on their bill no later than the due date indicated on said bill, which must be at least
twenty (20) days after the date the bill was sent. The objection or request for
investigation can be filed at any commercial or local office of the Authority, by phone at
the Customer Service Center, or by mail, fax, or Internet to the address or telephone
numbers provided by the Authority for this purpose. When the request is made in
person or over the phone, customers must ask for the claim number as evidence. If the
investigation of a charge is requested in time, the service cannot be suspended due to
non-payment while the following administrative process for an objection is in progress.
The objected amount is not deemed to be a debt until a final decision has been made
pursuant to the provisions established in this section.
1. The commercial office conducts the investigation and notifies the customer of the
outcome in writing no later than sixty (60) days following the filing of the request
or objection. If the office needs additional time to conclude the investigation, it will
notify the customer in writing within the sixty (60) day term, stating the reason for
the extension and the additional time it deems it will take to conclude the
process. The time period allowed up to the outcome of the investigation is
notified cannot exceed six (6) months following the date the original request or
objection is made, save in exceptional cases.
2. The customer has ten (10) days after the notification of the outcome of the
investigation to pay or to object to the decision made by the commercial office
official before the designated regional representative. Said official has twenty
(20) after the objection is filed with him or her to issue a decision and to issue
written notification of the decision to the customer.
3. The customer has ten (10) days after the decision by the regional representative
designated official of the region has been notified to pay or request a review of
the decision and an administrative hearing with the executive director. The
executive director, or the official designated by him or her, reviews the decision
of the designated official of the region within twenty (20) days. If the customer is
not satisfied with the outcome of said review, the Authority designates a licensed
attorney who is not an Authority employee to act as the examining officer of an
[CERTIFIED TRANSLATION] 33

administrative hearing and to render a judgment on the customer’s allegations.

The examining officer’s resolution will become the final decision by the public
corporation.
Article B: Administrative Hearing
1. The Authority may request that the customer pay a sum equal to the average
monthly or bi-monthly bill, whichever the case may be, prior to the hearing. This
amount is determined by using the customer’s consumption history over the
previous twelve (12) months. If the customer has objected to more than one bill,
he or she pays the average determined for each bill objected.
2. The designated examining officer renders judgment on the customer’s argument
within ninety (90) days after the case has been submitted. During the
administrative hearing, the customer may be represented by an attorney and he
or she has the opportunity to present oral and written evidence, as well as to
examine the evidence and cross-examine the witnesses presented by the
Authority in support of their administrative decision.
3. If the examining officer issues a resolution that is adverse to the customer and
upholds the payment of all or part of the objected charge, the customer must pay
the balance owed within thirty (30) days from the notification of the resolution.
The customer may also request a reconsideration or judicial review of the
resolution, pursuant to the provisions for reconsideration and judicial review in
Public Law No. 170 of August 12, 1988, as amended. If the outcome of the
hearing or judicial review is favorable to the customer, the Authority returns to, or
credits the account for, the sum paid in excess, if any, plus interest at ten percent
(10%) per annum.
4. The Authority can request reconsideration and turn to the court for a review of
the final resolution issued by the examining officer within the same time periods
established in paragraph 3 above.
5. If the customer follows with the procedure established for objecting to billed
charges, the Authority will not suspend the electric power service for non-
payment of any charge being objected. Charges that have not been objected to
in accordance with the established procedure must be paid in full no later than
the due date indicated on the bill, or the service can be suspended as set forth in
Section XIV of this Regulation.
[CERTIFIED TRANSLATION] 34

SECTION XIV - SUSPENSION OF SERVICE

Article A: Grounds for Suspension and Notification
If customers do not pay their bill and do not follow the procedure for objecting to the
charges within the term established in Section XIII of this Regulation, the Authority may
suspend their service for non-payment. It may also suspend their service for any
violation of the provisions established by the laws, regulations, norms, manuals, codes,
standards, or technical correspondence in effect. In the latter case, the Authority notifies
the customers of the details of the violation and if it requires action by the customers to
eliminate or correct an existing situation and grants them a term of at least twenty (20)
days to eliminate or correct the situation, except when there is a risk of imminent
damage to life or property, in which case the provisions of Article D of this section apply,
or when there is improper use, in which case the provisions of Section XI of this
Regulation apply. Once the violation has been determined or the term granted has
passed without the customer having corrected or eliminated same, whichever is
applicable, the Authority notifies the customer in writing of its decision to suspend the
service. When the suspension is a result of failure to pay the unobjected overdue
charges, the notification of suspension is sent once the term granted to pay or to object
and request an investigation of any charge billed has passed. This notification can be
included in the bill where said charges are reflected. Suspension of the service is done
subsequent to the twenty (20) day term following the notification of suspension, and it
will never take place on Fridays, Saturdays, Sundays, or holidays, or the business day
prior to the holiday, save as provided in Article D of this Section, Article C of Section XI,
and in Article D of this Regulation.
Article B: Reconnection Charges
The reconnection charge is ten dollars ($10) for customers with a subsidized residential
rate, twenty-five dollars ($25) for residential customers, fifty dollars ($50) for commercial
customers without metering equipment, and one hundred ($100) for commercial or
industrial customers with metering equipment. In the case of suspension of service for
non-payment, if the customer does not have a deposit or bond guaranteeing its
payment, or if the customer’s guaranty is not enough, the Authority will proceed as
established in Section V, Article B, paragraphs 1 and 3 of this Regulation.
Article C: Essential Service for the Elderly and Disabled
When the electric power service is essential for the elderly and the disabled, fees are
collected through the adoption of a flexible bill payment plan. The following is taken into
[CERTIFIED TRANSLATION] 35

consideration: the amount owed, the customer’s payment capacity, payment history,
periods in arrears, and other pertinent details. In the cases of disabled persons who use
special equipment, such as respiratory equipment, dialysis units, etc. that need
electricity to function and are indispensable for their survival, customers must report it to
the Authority via a medical certificate to such effect. The Authority sends an investigator
to the customer’s home to verify the information it received and it takes the necessary
measures to prevent suspension of the service. In none of these cases does a flexible
collection procedure apply to the debt for consumption exceeding what is determined to
be reasonable, based on the customer’s particular needs.
Article D: Suspension due to a Situation or Condition at the Customer’s Electrical
Installation
When the Authority detects a situation or condition at the customer’s electrical
installation that requires that the customer to repair it promptly for continuity of service,
notification is given to the customer by any means, whether by telephone, in person, or
in writing. If circumstances so permit, the Authority grants the customer a term of no
more than twenty (20) days to perform the necessary repairs. If after said term the
repairs required to eliminate the risk condition have not been carried out, the electric
power service is suspended immediately. When the risk of causing damage to lives or
property is imminent, the service is suspended as soon as the condition or situation is
detected; but in such case, the notification explaining the reasons for such suspension is
done immediately thereafter. Customers can object to the determination of danger
made by the Authority following the procedure established in Section XVII of this
Regulation.
SECTION XV: SERVICE INTERRUPTIONS
The Authority’s objective is to provide efficient, reliable service to the people of Puerto
Rico. However, the Authority may be forced to interrupt electric power supply without
prior notice due to force majeure. It may also be obliged to suspend service for repairs
or maintenance work, in which case affected customers are notified beforehand. Such
interruptions do not constitute a breach by the Authority of the Electric Power Supply
Contract, and therefore neither the Authority nor any of its employees, officials, or
directors is responsible for any resulting damages, losses, or causes of action.
SECTION XVI: OTHER PROVISIONS
Article A: Powers of the Governing Board
[CERTIFIED TRANSLATION] 36

None of the provisions contained in this Regulation shall be construed as a limitation of

the power of the Authority’s Governing Board to establish any other condition that does
not violate the law or to amend these terms and conditions should they deem it
necessary to protect the interests of the Authority and of the People of Puerto Rico.
Amendments to this Regulation are enacted as provided under Public Law No. 170 of
August 12, 1988, as amended, and once in effect, they apply to all customers using the
electric power service provided by the Authority.
Article B: Discrepancies
In case of a discrepancy or contradiction between any special contractual provision and
any other provision regarding rates or in these General Terms and Conditions, the
provision that shall prevail will be determined based on the following criteria:
1. For a discrepancy or contradiction between the Regulation Governing Electricity
Service Rates and the Regulation Governing the General Terms and Conditions
for Supplying Electric Power, the Regulation Governing Electricity Service Rates
prevails.
2. For a discrepancy or contradiction between the Regulation Governing the
General Terms and Conditions for Supplying Electric Power and the Electric
Power Supply Contract, the Regulation prevails.
Article C: Official Text
The Authority declares that, for all legal purposes, the official original text of this
Regulation is the Spanish language version.
SECTION XVII: ADMINISTRATIVE PROCEDURE
Article A: Request for Reconsideration
The party adversely affected by a determination by the Authority based on the provisions
of this Regulation, except those related to the objection of billed charges, which are
governed by Section XIII of this Regulation, can request a reconsideration within ten (10)
days after being notified of same. Said request must be submitted in writing before the
official who issued the determination for which reconsideration is requested, stating the
grounds on which the request is based.
Article B: Formal Adjudication
The official before whom the request is submitted considers it and notifies the customer
of his or her final determination in writing within twenty (20) days after it is submitted. If
the customer is not satisfied with the final determination, he or she has ten (10) days
after the date of the notification to file a request or petition with the Office of the
 [CERTIFIED TRANSLATION] 37

Secretary of Adjudicative Procedures of the Puerto Rico Electric Power Authority for the
controversy to be decided on pursuant to the formal adjudication procedure established
in the Regulations Governing the Adjudication Procedure for Complaints of the Puerto
Rico Electric Power Authority, adopted by virtue of Public Law No. 170 of August 12,
1988, as amended, the Uniform Administrative Procedure Act of the Commonwealth of
Puerto Rico.
SECTION XVIII: SEVERALBILITY
The declaration of any part of this Regulation as being unconstitutional by a competent
court does not affect the validity of the remaining other provisions.
SECTION XIX: REPEAL
This Regulation substitutes and nullifies the Regulation Governing the General Terms
and Conditions for Supplying Electric Power filed at the Department of State on February
11, 2008, under No. 7464.
SECTION XX: EFFECTIVE DATE
This Regulation enters into effect thirty (30) days after it is filed at the Puerto Rico
Department of State pursuant to the provisions of Public Law No. 170 of August 12,
1988, as amended, the Uniform Administrative Procedure Act of the Commonwealth of
Puerto Rico.
SECTION XXI: APPROVAL
The Governing Board of the Puerto Rico Electric Power Authority approved this
Regulation through Resolution No. 3756 of August 24, 2010.

Miguel A. Cordero López

Executive Director
Puerto Rico Electric Power Authority

Date
11/16/10

CERTIFICATE OF TRANSLATION INTO ENGLISH

I, Roslyn C. Famous, a professional translator with an M.A. in Translation, hereby certify that, to the best of my knowledge and
abilities, the foregoing is a true and faithful rendering into English of the Spanish text, made at the request of the interested party.

In San Juan, Puerto Rico, today, December 21, 2010.

Roslyn C. Famous
165 Avenida Hostos, #338A
San Juan, PR 00918
[CERTIFIED TRANSLATION] 38