Puerto Rico Electric Power Authority

Puerto Rico Gov. Jenniffer González Colón filed suit to end the island's contract with LUMA Energy for electrical transmission and distribution.

92% of the holders or insurers of Puerto Rico Electric Power Authority bonds reportedly now oppose the Oversight Board's proposed restructuring deal.

The three Puerto Rico Oversight Board members can resume their positions immidiately, District Court Judge Maria Antongiorgi-Jordan ruled.

"A lawsuit like this is probably critical for any future settlements or agreements, because it will (maybe) determine up front if the incoming [board] members, and thus whatever agreements they sign, are valid or not," said Matt Fabian, a partner at Municipal Market Analytics.

The Puerto Rico Energy Bureau has about 150 days to set new rates for consumers.

PREPA bondholders who back the Oversight Board's proposed deal say it will lose their support if not confirmed by Oct. 1.

U.S. District Judge Laura Taylor Swain gave no indication at the hearing as to how she was leaning and said some issues might not be able to be resolved as a matter of law.

Two New York members of Congress called them "vulture funds" trying to get "blood out of a turnip" at the expense of Puerto Rico electricity customers.

Puerto Rico's disputes with New Fortress Energy, the parent of the island's power plant operator, Genera PR, could spread to PREPA.

As long as the Oversight Board offers virtually nothing to many PREPA bondholders, the bankruptcy is likely to be tied up for years in litigation.

Whether PREPA can pay the administrative expense claim doesn't affect its validity, the bond parties said.

Observers say a bankruptcy by Genera PR could complicate the PREPA bankruptcy.

The Puerto Rico Oversight Board asked Judge Laura Taylor Swain to rule now and move quickly to disclosure and confirmation hearings.

The department shifted funds that would have been invested in solar power to improve the island's electrical system.

The bondholders and board faced off over the creditors' belief they they are due the administrative expense claim.

Rep. Scott Fitzgerald said PROMESA indicated PREPA needed to regain access to capital markets and suggested a deal with bondholders would aid this.

The Oversight Board will continue to "prepare for a more dire outcome but continue to hope for the best," said Chairman Arthur Gonzalez.

The bondholders say the failure to pay them net revenues since the 2017 bankruptcy start gives rise to their administrative expense claim.

Bond parties say the board's failure to settle the PREPA bankruptcy has contributed to the system's unreliability.

At issue is whether PREPA bondholders may get a portion of the roughly $575 million available for unsecured claims against Puerto Rico's government