Volatile Oil Prices Accelerate Honduras’ Renewable Energy Development

National Economy

The Central American country of the Republic of Honduras is bordered by Guatemala, El Salvador, Nicaragua, Pacific Ocean and the Caribbean Sea. The population of Honduras is approximately 10.33 million people[1].

In 2022, Honduras’ economy was ranked 106th in the world in gross domestic product (GDP)[2]. The country’s economy is dependent on the export[3] of knit t-shirts, coffee, knit sweaters, insulated wire, palm oil, bananas and melons.

Environmental Policies

In April 2016, Honduras signed the Paris Climate Agreement[4], pledging to reduce emissions by 15% by 2030 compared to business-as-usual levels.

Power Generation Capabilities

In 2020, 93.21% of the people in this Central American country had access to electricity[5]. In 2021, the state-owned utility[6], Empresa Nacional de Energía Eléctrica (ENEE) used renewable energy (52.1%), oil (43.4%) and coal (4.5 %) to generate electricity in Honduras. Hydropower, solar, biomass, wind, and geothermal are the types of renewable energy used to generate electricity in Honduras.

Recent renewable energy projects in Honduras include:

  • 300 MW Hydroelectric Renovation Project – State-owned electric utility, ENEE is continuing work on the renovation of the Francisco Morazàin hydroelectric complex which is located approximately 140 miles northwest of the nation’s capital, Tegucigalpa.
  • 112 MW Wind Project – French energy company TotalEnergies is continuing work on the San Marcos Wind Energy project at a site approximately 50 miles southeast of Tegucigalpa.
  • 6 MW Solar Project – In July 2015, Norwegian renewable energy company, Scatec commissioned the Agua Fria Solar project at a site approximately 50 miles south-southwest of Tegucigalpa.
  • 4 MW Solar Project – U.S. solar company, Shoals Technologies is continuing work on the San José solar project a solar at a site approximately 70 miles northeast of Tegucigalpa.
  • 35 MW Geothermal Project – In September 2017, Honduran company Geotérmica Platanares commissioned the Platanares geothermal power at a site approximately 90 miles west-northwest of Tegucigalpa.

Conclusions

Honduras imports all of the nation’s refined petroleum for transportation and power generation. In 2020, Honduras spent[7] U.S. $743 Million for imported refined petroleum.

On 24 February 2022, Russia invaded Ukraine, prompting the European Union, United Kingdom, United States, Canada, Japan, South Korea, Australia, and New Zealand to place economic sanctions on Russian imports and exports. As a result, the crude oil and natural gas prices increased by over 50% from May 2021 to May 2022.

Honduras has significant undeveloped renewable energy resources, including solar, hydropower, geothermal, onshore wind, offshore wind, and biomass. However, the nation’s government has been slow to move from diesel-fueled power plants to low-cost, reliable renewable energy.

The recent rise in the price of fossil fuels (oil, coal, and natural gas) is causing oil importing countries like Honduras to make renewable energy development a priority. Volatile oil prices are now accelerating Honduras’ development of renewable energy.

 

Jack Kerfoot

Website – “Our Energy Conundrum”

www.jack kerfoot.com

 

Jack Kerfoot is a scientist, energy expert, and author of the book FUELING AMERICA, An Insider’s Journey and articles for The Hill, one of the largest independent political news sites in the United States. He has been interviewed on over 100 radio and television stations from New York City to Los Angeles on numerous energy related topics.

 

[1] Republic of  Honduras Population (2023) –  March 10, 2023, www.worldometers.info

[2] Gross Domestic Product By Country 2022 – Worldometer

[3] The Observatory of Economic Complexity (OEC) – Honduras

[4] Carbon Brief “Paris 2015: Tracking Country Climate Pledges”

[5] World Bank, Access To Electricity (% Population) – Honduras

[6] Our World In Data, Honduras: Energy Country Profile by Hanna Ritchie and Max Roser

[7] The Observatory of Economic Complexity (OEC) – Honduras

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