ST. CROIX — The Virgin Islands Water and Power Authority pushed back against criticism from At-Large Senator Angel Bolques Jr. over its recent liquefied petroleum gas procurement process and pending contract with Empire Gas Company, defending both the transparency of the bid process and the financial merits of the deal.
Karl Knight, WAPA CEO and executive director, responded to issues raised in a recent letter from Bolques that questioned the fairness of the request for proposals process and warned of potential risks tied to the new fuel supplier.
Knight defended the RFP process, citing broad advertising through multiple channels and direct outreach to 16 energy companies.
With no bidder selected, WAPA terminated the process due to unfavorable results and entered direct negotiations with Empire Gas, a family-owned propane company founded in 1967 in Puerto Rico. Knight emphasized Empire’s long history, logistical capabilities, and financial benefits over the current supplier — Vitol, whose contract expires at the end of the month.
“I appreciate the senator’s interests and doing his due diligence to make sure we’re making the right decision, but I assure the general public and our customers that we have been thorough in our investigation of who best can supply and meet the needs of the Water and Power Authority as it relates to LPG, and we’ve made a selection that ultimately is in everyone’s best interest,” Knight said.
Bolques, in a letter dated July 30 to Knight and Maurice Muia, WAPA board chair, raised concerns he noted were expressed to him through numerous phone calls. He pointed out that the RFP was not broadly distributed, and that WAPA entered direct negotiations with Empire Gas after the solicitation failed to identify a suitable bidder instead of reissuing the RFP. The senator also warned that the agreement with Empire Gas could expose the Virgin Islands to fuel supply disruptions, inflated costs, and even blackouts, citing concerns over the company’s maritime and emergency response capabilities.
“To protect the territory’s energy security and public interest, I strongly urge the board to consider suspending consideration of the proposed contract temporarily, reissue the LPG supply RFP with broad public notice to attract a wider pool of qualified suppliers, and ensure a transparent, documented evaluation process based on clearly defined criteria tied to experience, technical capacity, and financial reliability,” Bolques wrote.
Knight responded in a letter dated Aug. 4, assuring the senator that the fuel procurement process has been handled with extreme diligence, as fuel purchases account for more than 40% of WAPA’s operating expenses.
“Based on the complete evaluation of all supplier proposals, pricing structures, delivery capabilities, and infrastructure readiness, VIWAPA has deemed it prudent to enter an agreement with Empire Gas as the new LPG supplier to the Virgin Islands,” Knight wrote. “Empire Gas has demonstrated superior readiness, robust regional infrastructure, competitive pricing, and a deep understanding of utility-scale fuel delivery logistics.”
Responding to Bolques’ claim that the RFP for LPG suppliers was not widely circulated, Knight disagreed.
“Not only did we go through the usual routes of advertising on our website, advertising in the local periodical, we also advertise with the American Public Power Association, which is the largest association of electric utilities in the country,” he told WTJX. “They also have several associate members that support electric utilities, and so we advertise there. And we did the same with the CARILEC [Caribbean Electric Utility Services Corporation], which is the largest regional organization of electric utilities in the Caribbean.”
Bolques also criticized WAPA’s decision to halt the RFP process and instead enter direct negotiations with Empire Gas. Knight acknowledged that the formal bid process ended but said it was for practical and financial reasons.
“The conclusion of the RFP process did not yield us results that ultimately would have moved the needle in any considerable fashion from a cost perspective,” he said, adding that the results did not serve the best interests of WAPA’s customers, so the process was terminated.
With WAPA’s existing arrangement with Vitol set to expire at the end of the month, Knight said there was not enough time to reissue the RFP, give new vendors a chance to tour WAPA facilities, and evaluate new proposals. Since companies had already submitted proposals, he said it was unlikely any new suppliers would enter the process.
Instead, Knight said WAPA received board authorization to negotiate directly with providers, citing “public exigency.”
Empire Gas was one of several firms approached, including past bidders and others previously invited to participate, Knight said. He said Empire emerged as a strong candidate due to its regional presence and delivery capabilities.
“I think that we actually have a partner that understands our challenges, understands our needs for emergency supplies, can deliver fuel to us with very short notice,” he said.
In his letter, Bolques warned that the agreement with Empire Gas could expose the Virgin Islands to fuel supply disruptions, inflated costs, and even blackouts, citing concerns over the company’s maritime and emergency response capabilities. Knight rejected those claims.
“At the end of the day, their facilities are a six- to 10-hour sail from Puerto Rico to St. Thomas to St. Croix, depending on the size of the load that they’re carrying,” Knight said. “And I think it’s a great relationship for us to foster. They have four different terminals that they store fuel and ship from.”
As WAPA prepares to end its long-standing relationship with Vitol, Knight said WAPA is grateful for the infrastructure that Vitol put in place.
“The acquisition of those terminals last year by the Water and Power Authority, through the assistance of the government of Virgin Islands, has put us in a position to explore the competitive market, and we have made a decision to move beyond the decade or longer relationship that we’ve had with Vitol,” he said.
Knight said WAPA had hoped to sign the contract with Empire Gas last week, but the signing is now expected to happen sometime this week.
