Schedule B

Legacy Charge

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Schedule B Page 1 of 7
Term Description1

Legacy Charge The “Legacy Charge” shall consist, collectively, of all applicable 

Flat Fees and Volumetric Charges set at the levels for each customer 

class set forth in the Annex 1 attached hereto, subject to the 

Amendment Test and the modification provision set forth in the 

Plan, to be included in customer rates pursuant to the Plan and 

Confirmation Order.

Implementation of the Legacy Charge is in discussion with LUMA 

Energy2 as servicer, and is subject to amendment as the Oversight 

Board works with government and LUMA Energy on 

implementation issues.

Legacy Charge’s

Purpose

The Legacy Charge is collected to ensure sufficient cash flow 

required for PREPA’s debt service on the New Bonds issued under 

the Plan.

Applicability The Legacy Charge will be assessed on all of PREPA’s customers, 

except where the Plan specifically exempts some or all of the Flat

Fee or Volumetric Charge. The Legacy Charge will apply to 

existing and future classes of PREPA customers in use by PREPA 

and/or LUMA Energy, on behalf of PREPA, as modified subject to 

the Amendment Test set forth in the Plan. Annex 1 reflects certain

categories of PREPA’s customer base that will establish how each 

PREPA customer is charged the Legacy Charge, subject to the 

Amendment Test set forth in the Plan. 

Names and descriptions of certain existing rate classes established 

by PREPA, some of which may be referred to in Annex 1, are 

attached hereto as Annex 2. For the avoidance of doubt, any rate 

class that is subsequently created, any existing rate class currently 

having no customers but subsequently having customers, or any rate 

class otherwise not explicitly referenced in Annex 1 or Annex 2, 

will be subject to the Legacy Charge and will be classified in 

accordance with the Amendment Test and modification provision in 

the Plan.

Term The Legacy Charge will become effective on the Effective Date of 

the PREPA Plan and shall remain in place until its termination on 

the later of (i) the maturity of the CVI and (ii) the full payment of 

the Series B Bonds. 

 1 All Capitalized terms not set forth herein shall have the meaning ascribed to such term in the Plan to which this 

Schedule B is attached.

2 As used herein, “LUMA Energy” shall refer, collectively, to LUMA Energy, LLC and LUMA Energy ServCo, 

LLC, which were formed by the consortium of ARCO Ltd. (succeeded by its affiliate, Canadian Utilities Limited), 

Quanta Services, Inc. and Innovative Emergency Management, Inc.

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Flat Fee PREPA will charge a flat fee (the “Flat Fee”), incremental to any 

existing PREPA rates and fees, in the amount set forth for the 

applicable customer class on Annex 1, to each customer account 

each month unless the customer qualifies for an exemption from the 

Flat Fee. The amount paid for the Flat Fee is assessed on a U.S. 

dollar basis, and is not linked to a customer’s power consumption, 

but rather is assessed for each non-exempt customer being 

connected to the PREPA electricity grid. 

Volumetric Charge PREPA will charge a monthly fee (the “Volumetric Charge”), 

incremental to any existing PREPA rates and fees, in the amount set 

forth for the applicable customer class on Annex 1, based on each 

customer’s monthly consumption of electricity. Subject to the 

Amendment Test and modification provision set forth in the Plan, 

the Volumetric Charge will be assessed on a cents per-kilowatt hour 

basis for electricity supplied by PREPA during each billing cycle as 

follows:

• For each kWh (or fraction thereof) consumed, as measured 

by a meter read, during a given calendar month, up to and 

including the Volumetric Charge Threshold, in an amount 

equal to the applicable rate set forth in Annex 1 hereto.

• For each kWh (or fraction thereof) consumed during a given 

calendar month, as measured by a meter read, that exceeds

the Volumetric Charge Threshold, in an amount equal to the 

applicable rate set forth in Annex 1 hereto.

Volumetric Charge 

Threshold

Approximately 500 kWh (the “Volumetric Charge Threshold”). 

Exemption For a given billing cycle, PREPA will provide for an exemption 

from the Flat Fee and the Volumetric Charge corresponding to the 

monthly consumption at or below the Volumetric Charge Threshold, 

each as set forth in Annex 1, for residential customers who, during 

such billing cycle, are classified as LRS, RH3, or RFR (each, as 

defined in Annex 2). 

Solely for purposes of assessing the Legacy Charge, the following 

customers will also be exempt from the Flat Fee and Volumetric 

Charge corresponding to the monthly consumption at or below the 

Volumetric Charge Threshold, each as set forth in Annex 1:

• Residential customers of PREPA whose Modified Adjusted 

Gross Income (MAGI) is below a certain threshold similar to 

the MAGI eligibility levels needed to qualify for Medicaid 

healthcare benefits in Puerto Rico.

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The criteria for any exemptions are subject to the Amendment Test 

and modification provision set forth in the Plan.

Billing The Legacy Charge will be collected as part of the PREPA bill by 

PREPA’s operator and servicer in the same manner the bills are 

currently collected.

Application of Legacy 

Charge Revenues

The increase in Net Revenues generated from inclusion of the 

Legacy Charge will, until full payment of the principal of the New 

Bonds, fund debt service on the New Bonds after payment of 

PREPA’s Operating Expenses, as specified in the Plan. If 

repayment in full of the principal of the New Bonds occurs prior to 

maturity of the CVI, revenues from the Legacy Charge thereafter 

will fund distributions to holders of CVI until maturity of the CVI.

Modification Modification of the Legacy Charge will be done if and only if the 

Amendment Test is complied with.

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Schedule B Page 4 of 7
Annex 1

(to Schedule B)

[To be determined]

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Annex 2

(to Schedule B)

PREPA Customer Segmentation1

PREPA maintains a differentiated rate structure for its customers depending on their customer 

class. The descriptions below, in conjunction with any other categorization of customers 

currently utilized by PREPA, identify categories of PREPA’s customer base that may be utilized

in establishing how each PREPA customer is charged the Legacy Charge.

Residential Classes

1. GENERAL RESIDENTIAL SERVICE (GRS) - This rate shall apply to residential 

customers for domestic uses for a residence or apartment unless they fit into one of the 

other classes below. This rate may also apply to houses, apartments, and other structures 

which are primarily intended for residential purposes, where no more than two rooms in 

which the total connected load does not exceed 500 watts are used by tenant for business 

or professional purposes.

2. LIFELINE RESIDENTIAL SERVICE (LRS) - This rate shall apply to residential 

customers, who fulfill the Nutritional Assistance Program criteria, for all domestic uses 

for a residence or apartment.

3. RESIDENTIAL SERVICE FOR PUBLIC HOUSING PROJECTS (RH3) - This rate shall 

apply to residential customers of Public Housing Projects supported or subsidized in 

whole or in part by loans, grants, contributions or appropriations of the federal, state, or 

municipal governments. 

4. RESIDENTIAL FIXED RATE FOR PUBLIC HOUSING UNDER OWNERSHIP OF 

THE PUBLIC HOUSING ADMINISTRATION (RFR) - The RFR Rate is established by 

according to the dispositions of Act 22-2016 and is granted to customers residing in a 

housing unit physically located within a public housing project owned by the Public 

Housing Administration for all domestic uses.

Commercial and Industrial Classes

1. GENERAL SERVICE AT SECONDARY DISTRIBUTION VOLTAGE (GSS) - This 

rate shall apply to any non-residential service with a load lower than 50 kVA. Also, it 

shall apply to temporary electric power service for limited use in streets, carnivals and 

others.

2. GENERAL SERVICE AT PRIMARY DISTRIBUTION VOLTAGE (GSP) - This rate 

shall apply to industrial customers and commercial customers. Service shall be rendered 

through a single point of connection and a single meter. 

 1 PREPA rate book, as of May 2019. Accessible at: https://lumapr.com/wp-content/uploads/2021/07/Tariff-BookElectric-Service-Rates-and-Riders-Revised-by-Order-05172019-Approved-by-Order-05282019.pdf.

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3. GENERAL SERVICE AT TRANSMISSION VOLTAGE (GST) - This rate shall apply 

to commercial and industrial customers, connected to the transmission system, that have a 

demand of 250 kVA or greater, for general uses including motive power, heating, 

refrigeration, and incidental lighting of industries, hotels, and any other establishment. 

4. TIME OF USE AT PRIMARY DISTRIBUTION VOLTAGE (TOU-P) - This rate shall 

apply to commercial and industrial customers with a demand of 1,000 kVA or greater, 

that: 1. Transfer load from the on-peak period to the off-peak period 2. Add load during 

the off-peak period 3. Remove load from the on-peak period 

5. TIME OF USE AT TRANSMISSION VOLTAGE (TOU-T) - This rate shall apply to 

commercial and industrial customers with a demand of 1,000 kVA or greater, that: 1. 

Transfer load from the on-peak period to the off-peak period 2. Add load during the offpeak period 3. Remove load from the on-peak period

6. LARGE INDUSTRIAL SERVICE -115 kV (LIS) - This rate is exclusively for industries 

with a demand equal to 12,000 kW or higher, with a load factor equal to 80% or higher, 

and a monthly average power factor equal to 95% or higher. 

7. GENERAL AGRICULTURAL SERVICE AND AQUEDUCT PUMPS OPERATED BY 

RURAL COMMUNITIES (GAS) - This rate applies to farmers and customers dedicated 

to raising animals. The service shall be provided for motive power, lighting, irrigation 

pumps, refrigeration and heating. Also, this rate applies to customers that operate pumps 

to supply aqueduct service exclusively in rural communities; incidental lighting related to 

this operation is permitted.

8. OUTDOOR SPORTS FIELD LIGHTING FOR PARKS WHERE ADMISSION 

RIGHTS ARE COLLECTED (LP-13) - This rate shall apply to sports fields where 

admission rights are collected having a connected load for outdoor illumination of 500 

kilowatts or greater

9. CABLE TV POWER SUPPLIES (CATV) - This rate applies to all cable TV power 

supplies.

10. UNMETERED SERVICE FOR SMALL LOADS (USSL) - This rate shall apply to the 

services of the electric equipment installed on PREPA’s pole or structures that operate 24 

hours a day, except for that equipment for which PREPA has another rate available (for 

example: Cable TV). 

11. POWER PRODUCERS CONNECTED AT PREPA BUS BAR - This rate shall apply to 

large power producers connected to the 230 kV bus bar that require PREPA’s electric 

power service during startup, programmed maintenance, and outages of its generating 

equipment.

12. PUBLIC LIGHTING GENERAL (PLG) - This rate shall apply to the lighting of streets, 

ball parks and other parks of free admission, plazas, telephone booths, bus shelters, and 

traffic and police strobe lights.

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