The electricity sector in Honduras is characterized by the dominance of a vertically integrated utility (except for about half of the generation capacity); an incomplete attempt in the early 1990s to reform the sector; the increasing share of thermal generation over the past two decades; the poor financial health of the state utility Empresa Nacional de Energía Eléctrica (ENEE); the high technical and commercial losses in transmission and distribution; and the low electric coverage in rural areas.
The key challenges in the sector are:
- how to finance investments in generation and transmission in the absence of either a financially healthy utility or of concessionary funds by external donors for these types of investments;
- how to rebalance tariffs, cut arrears and reduce commercial losses - including electricity theft - without fostering social unrest;
- how to reconcile environmental concerns with the government's objective to build two new large dams and associated hydropower plants; and
- how to improve access in rural areas.
In June 2007, the President of Honduras, Manuel Zelaya, declared an "energy emergency". An Intervention Board (Junta Interventora), headed by the Minister of Defense and the Minister of Finance, was temporarily put in charge of ENEE to address the crisis. The mandate of this Board has recently been extended until October 2008.
Read more about Electricity Sector In Honduras: Access To Electricity, Tariffs, Cost Recovery and Subsidies, Investment and Financing, Summary of Private Participation in The Electricity Sector, External Assistance, Sources
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“Prudence and justice tell me that in electricity and steam there is more love for man than in chastity and abstinence from meat.”
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