The Puerto Rico Court of Appeals recently ruled in a significant case involving LUMA Energy, LLC and the Municipio de Camuy. The court's decision, issued on August 5, 2026, addresses a dispute over the billing practices of LUMA Energy regarding municipal properties. This ruling is important as it impacts how municipalities are charged for electric services and could influence future interactions between energy providers and local governments.

The case, docket number TA2026RA00364, began when the Municipio de Camuy objected to a bill issued by LUMA Energy for over $521,000. The municipality argued that several of its properties were incorrectly excluded from a tax exemption program known as the Contribución en Lugar de Impuestos (CELI). The court's decision to reverse a previous ruling means that LUMA Energy must now address these billing issues in a manner consistent with the court's opinion.

Background

The parties involved in this case are LUMA Energy, LLC, and LUMA Energy ServCo, LLC, which provide electric services in Puerto Rico, and the Municipio de Camuy, a local government entity. The dispute arose after LUMA Energy issued a bill on October 31, 2023, totaling $521,395.44 for electricity consumed by municipal properties. The Municipio de Camuy objected to this bill, claiming that it included charges for properties that should have been exempt under the CELI program.

The CELI program allows municipalities to receive tax exemptions for properties used for public and community services. The Municipio de Camuy argued that the properties in question were utilized for such purposes and should therefore be included in the CELI calculations. After filing a complaint with the Puerto Rico Energy Bureau, the Municipio sought to cancel the accumulated debt and cease billing for the disputed properties.

The Ruling

The Court of Appeals ruled in favor of the Municipio de Camuy, reversing the Energy Bureau's previous decision that had favored LUMA Energy. The court found that the Energy Bureau had made errors in its handling of the case, particularly regarding the summary judgment that had been issued without allowing LUMA the opportunity to present evidence or contest the claims made by the Municipio.

The court stated, "The Negociado committed an error by resolving the controversy summarily and motu proprio without giving LUMA the opportunity to exercise its right to respond to the complaint and present evidence."

Furthermore, the court emphasized that there were material facts in dispute that warranted further examination. The judges involved in this ruling included Judge Aldebol Mora, who authored the opinion, along with Judge Brignoni Mártir and Judge Salgado Schwarz.

Impact

This ruling has significant implications for the relationship between energy providers and municipalities in Puerto Rico. It reinforces the importance of due process in administrative proceedings, ensuring that parties have the opportunity to present their cases fully. The decision may also influence how other municipalities approach their billing disputes with LUMA Energy and similar entities in the future.

Moreover, the ruling sets a precedent regarding the handling of tax exemption claims under the CELI program, potentially leading to more rigorous scrutiny of billing practices by energy companies. Municipalities may feel empowered to challenge erroneous billing more aggressively, knowing that the courts will uphold their rights to due process.

What's Next

The case has been sent back to the Energy Bureau for further proceedings, allowing LUMA Energy the opportunity to respond to the Municipio's claims and present evidence. It remains to be seen how LUMA will adjust its billing practices in light of this ruling and whether there will be further appeals in this matter.