Honduran NGO proposes sweeping electricity sector reform

The Association for a More Just Society (ASJ) in Honduras has put forward a sweeping reform proposal for the nation's electricity sector, aiming to transform it from a financial drain into a catalyst for development. The organization highlights the deepening crisis within the National Electric Energy Company (ENEE), which reportedly incurs annual deficits of nearly L15.7 billion and an accumulated debt of approximately L146 billion. This debt is equivalent to a quarter of Honduras's total public debt, funds that ASJ argues could be better allocated to critical areas such as health, education, and security.

This reform initiative is built upon over a decade of ASJ's research, including investigations into irregularities in solar energy contracts, analyses of the contract with Empresa Energía Honduras (EEH) for its alleged lack of competition and weak penalties, and evaluations of the National Loss Reduction Program (PNRP) which pointed to political interference. ASJ asserts that these issues demonstrate the electricity system has been managed with political rather than technical criteria, benefiting a select few.

The proposed reform centers on six key pillars: restructuring ENEE and the market, consistently reducing technical and non-technical losses, implementing competitive public tenders for energy purchases, reorganizing ENEE's debt, electrifying underserved communities, and establishing transparent, targeted subsidies. ASJ advocates for a functional ENEE with separated generation, transmission, and distribution units, governed by international standards, and supports open competition and private investment in clean energy. Conversely, it opposes non-transparent contract negotiations and the capture of institutions by private interests that shift costs to consumers without fair processes.