Why it Matters

Millions in federal aid sit largely unspent as Puerto Rico residents face continued blackouts according to a Government Accountability Office (GAO) report, publicly released July 2, 2026. The island's electricity grid remains unstable nearly a decade after a string of natural disasters. The report points to bureaucratic delays, poor coordination between agencies, and shifting priorities as key reasons that repairs have stalled. Around $14 billion has been made available for grid recovery and modernization through three federal agencies. Despite that funding, GAO found only limited progress toward stabilizing the power grid, raising concerns about the broader economic toll on the U.S. territory's roughly 3.2 million residents.

The Big Picture

Puerto Rico's grid crisis began with Hurricane Maria in 2017, which triggered an 11-month blackout (the longest in U.S. history). Reconstruction efforts were then repeatedly set back: earthquakes in 2019 and 2020, Hurricane Fiona in 2022, and a nearly two-day, territory-wide blackout in April 2025. Yet according to the GAO, these disasters only partly explain why progress has been so slow.

The Federal Emergency Management Agency (FEMA) has obligated $11.1 billion for the effort since 2017, yet just $2.7 billion has been spent. The Department of Housing and Urban Development (HUD) and the Department of Energy (DOE) have committed $2.3 billion and $937 million, respectively, most of which remains undisbursed.

Only nine large FEMA projects have been completed for the territory's grid rebuild. Vegetation clearing was cited by stakeholders as an urgent priority, but as of February 2026, only around 400 miles of vegetation had been cleared using federal funds out of a planned 16,000 miles. Cumbersome environmental and historic preservation reviews, along with recent staff turnover across federal organizations, have further slowed recovery.

What's Next

The GAO issued five recommendations overall, three for FEMA and two for the DOE. Despite both departments agreeing to all of them, every recommendation remains listed as "open," meaning none have yet been fully implemented.

FEMA's first task is to update its guidance so it reflects flexibilities, like categorical exclusions, that could speed up environmental and historic preservation reviews. Second, FEMA is directed to ensure it has steady, sufficient staffing to conduct those reviews in the first place. Third, the GAO wants FEMA to identify and communicate ways to streamline its Puerto Rico funding programs, including any trade-offs or statutory changes that would require congressional action.

For DOE, the asks are more structural. One recommendation calls for clarifying objectives and roles among federal and Puerto Rico entities, potentially through an updated or new memorandum of understanding. The other pushes DOE to help establish a formal mechanism for coordinating that work across agencies.

The Bottom Line

Despite $14 billion being made available, the GAO report suggests money was never the main obstacle: process, staffing, and coordination were. Whether their five recommendations close that gap will depend on how effectively they are implemented, and whether future disasters allow them the runway to do it.

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