Energy Reform

The STENEE electrical workers' union says the International Monetary Fund's evaluation of Honduras should build on the recent power-sector reform law, which the union argues removed legal barriers to needed institutional investment and allowed ENEE to establish internal oversight and a structured loss-reduction plan.

René Alfaro, a former ENEE administrator, says Honduras's energy reforms have not yet produced tangible results and warns that tying financing to five-year loss-reduction targets lacks technical clarity and could hamper the state power utility's recovery.

An ASJ watchdog report warns that energy losses at Honduras's state power company have risen to 34.4%, a major 1,500-megawatt energy tender already delayed to 2027 risks supply shortages, and the three successor companies can absorb only a fifth of a 143.8-billion-lempira debt.

Honduras's new Energy Justice Law seeks to attract investment and boost competition in the electric sector while freezing ENEE rates for the first six months and opening the way for short- and long-term energy auctions and residential solar projects.

President Nasry Asfura signed the Law of Energy Justice, which restructures the state power utility ENEE by separating generation, transmission, and distribution into three subsidiary companies while maintaining state ownership, aimed at reducing losses and improving electricity service.

Honduras's new Energy Justice Law, approved by Congress in August, has drawn interest from international financial institutions and investors who see it as a signal of transparent investment rules and modernization, with the government estimating the sector needs about $6 billion to upgrade infrastructure and expand coverage.

Congress Energy Commission member Eder Mejía said the government's electric-sector reforms, which would forgive debts for users consuming under 200 kWh monthly, freeze rates for six months, and regularize illegal connections, are expected to be published in the official gazette next week.

ENEE Manager Guillermo Peña Panting said Congress-approved energy reforms are not being modified and outlined a timeline for implementation once published in the official gazette, including meetings with multilateral lenders and planning for resources, staffing, and technical support.

Honduras's planned energy reform faces delays as the government struggles to find resources to cover the cost of freezing electricity rates for six months, raising questions about who will ultimately bear the financial burden.

Honduras's newly approved Energy Justice Law, passed by Congress on August 31 with 78 votes, has not yet been published in the official gazette and cannot take effect until the President signs or vetoes it; business groups say swift implementation is critical to address the country's electricity crisis.

Energy Secretary Eduardo Oviedo said Honduras is drafting terms for a new electricity-generation auction split into two stages—one adding roughly 600 megawatts and a later phase potentially 1,000 megawatts—pending congressional approval of pending energy reforms; the sector will need about $6 billion in investment across generation, transmission, and distribution infrastructure.

Honduras's electricity regulator warns that Congress-approved reforms to the power sector remain unsigned and unpublished, delaying their implementation even as daily blackouts persist due to insufficient generation capacity.

Dozens of Hondurans carrying torches and signs marched peacefully to Casa Presidencial on Friday demanding government action on the country's water shortage and opposing recent energy reforms approved by Congress.

Honduras is separating ENEE's generation, transmission, and distribution into distinct state-owned companies and creating an independent system and market operator, mirroring reforms other Central American nations completed 20–25 years ago.

The U.S. State Department said it welcomes Honduras's passage of the Energy Justice Law, noting that American companies are interested in investing in the country's energy sector to improve reliability and create jobs.

The electrical regulator (CREE) is expected to approve a 17% rate increase on September 30, but a six-month rate freeze and state subsidies enacted by Congress will prevent the increase from reaching residential and vulnerable consumers.

Honduras suffers over 165 hours of blackouts yearly—versus fewer than 9 in El Salvador—costing businesses more than $100 million annually, and analysts warn the new Energy Justice Law's impact depends on institutional capacity to implement it.

Former president Manuel Zelaya criticized Congress's approval of an energy-reform law as a surrender of state control to private corporations, arguing it exemplifies how élites and external political pressure undermine Honduran democracy.

Thomas R. Hardy, operations director of the U.S. Trade and Development Agency, said energy-sector reform and infrastructure projects linking Honduras's Atlantic and Pacific coasts are essential to drawing American investment and strengthening the country's economy.

The electricity regulator warns Honduras risks power rationing next year unless it rapidly adds new generation capacity through competitive bidding, which it says—not tax breaks—will lower energy costs.

The president of Congress announced that lawmakers will resume debate on controversial reforms to Honduras's electricity sector on Tuesday, with party caucuses still negotiating points of disagreement ahead of the planned third and final vote.

The National Congress is poised to vote on an energy-reform bill next week after reaching broad consensus among parties, while preparing to review the 2027 budget with emphasis on food security and drought relief.

Congress President Tomás Zambrano gave the opposition Liberal Party 15 days to present a counter-proposal on energy reforms for state utility ENEE, warning that without agreement the executive could pursue alternative measures including a presidential decree.

Cohep president Anabel Gallardo called on Congress to pass the long-delayed energy law reform, warning that continued inaction weakens ENEE's governance and could deter investment.

Cohep's president warned that technical losses, theft, and illegal power tapping in the national grid represent resources that could be redirected to health, education, and infrastructure, and called for Congress to approve an energy-law overhaul to strengthen state utility Enee.

Honduras's energy reforms remain blocked in Congress due to disagreements between the ruling Libre and opposition Liberal parties, prompting a nationalist deputy to suggest the president may bypass the legislature by using ministerial council decisions.

Honduras ranks third in Central America for residential electricity costs at $0.236 per kilowatt-hour, but economists say the true cost to users and public finances is far higher due to losses at the state utility Enee, debt servicing, and an incomplete energy-sector reform.

The Partido Nacional said it would back the Liberal Party's competing energy-sector bill if it gains legislative consensus, citing insufficient votes for its own proposal and the urgency of approving public contracts to lower electricity costs for consumers.

Cohep, Honduras's main private-sector organization, rejected any involvement in a National Congress member Adolfo Ráquel's electricity-sector reform proposal, saying it has not reviewed or endorsed the initiative and will not be held responsible for its technical, legal, or financial implications.

Congress President Tomás Zambrano announced that lawmakers have reached consensus on electricity-industry reforms and may hold a final vote next Tuesday, citing annual losses exceeding 16 billion lempiras at the state utility and chronic blackouts affecting Honduras more severely than neighboring countries.