Electricity sector in Honduras
| Electricity coverage (2006) | 69% (total), 94% (urban), 45% (rural); (LAC total average in 2005: 92%) |
|---|---|
| Installed capacity (2006) | 1.54 GW |
| Share of fossil energy | 62% |
| Share of renewable energy | 38% (including hydro) |
| GHG emissions from electricity generation (2003) | 1.51 MtCO2 |
| Average electricity use (2005) | 4376 kWh per connection |
| Distribution losses (2006) | 21%; (LAC average in 2005: 13.6%) |
| Residential consumption (% of total) |
42.5% |
| Industrial consumption (% of total) |
53.3% (inc. commercial) |
| Average residential tariff (US$/kW·h, 2006) |
00.058; (LAC average in 2005: 0.115) |
| Average industrial tariff (US$/kW·h, 2006) |
0.1053(medium voltage), 0.0934 (high voltage); (LAC average in 2005: 0.107) |
| Average commercial tariff (US$/kW·h, 2006) |
0.133 |
| Annual investment in electricity | 4.01 US$ per capita |
| Share of private sector in generation | 62% |
| Share of private sector in distribution | 0% |
| Competitive supply to large users | No |
| Competitive supply to residential users | No |
| Responsibility for transmission | Integrated utility (Empresa Nacional de Energía Eléctrica) |
| Responsibility for regulation | National, single-sector regulator |
| Responsibility for policy-setting | Energy Cabinet |
| Responsibility for the environment | Ministry of Environment (SERNA) |
| Electricity sector law | Yes (1994) |
| Renewable energy law | Yes (2007) |
| CDM transactions related to the electricity sector | 19 registered CDM projects; 221,730 t CO2e annual emissions reductions |
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:
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.
With an installed generation capacity of 1,568 MW (2007), Honduras relies on a thermo-based power system (accounting for nearly two-thirds of its total installed capacity), which is very vulnerable to high and volatile international oil prices. The generation mix is as follows:
Source: ENEE
Firm electricity generation capacity is substantially lower than installed capacity due to seasonality (i.e. the natural uncertainty affecting hydroelectric generation), the old age of some of the plants, and mothballing of thermal capacity.
Expansion plans include the net addition of 1,479 MW of generation capacity in the period 2007-2015. The projected expansion by source is as follows:
Total gross addition: 2,021 MW
Net addition: 1,479 MW
Not all of these expansion projects may be feasible. In particular, two large hydropower projects on the Patuca and Cangrejal Rivers are controversial due to their environmental impact.
Total electricity sold in 2007 was 4,932 GW·h. In 2005, electricity sold by connection was 4,376 kWh, which was much higher than in the neighboring countries Guatemala (2,337 kWh per connection), Nicaragua (2,931 kWh per connection) and El Salvador (3,109 kWh per connection). It is, however, much lower than in the more developed Central American countries, such as Costa Rica (7,969 kWh) and Panama (7,574 kWh).
In 2007, percentages of electricity sold by consumer type were:
Peak demand has grown over 7 percent annually in recent years, reaching 1,088 MW in 2006. For the period 2006-2010, the expected annual rate of growth of energy demand is expected to be around 6% percent, while peak demand could increase at around 7%. The actual growth rate will depend on whether electricity tariffs would be increased, the success of a current program to decrease electricity theft and on whether technical distribution losses can be reduced.
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