Honduras Bets On Ethanol

Betting on ethanol in Honduras.

News Americas, TEGUCIGALPA, Honduras, Weds. July 16, 2014: With Honduras in the spotlight and some 40 of its nationals who tried to enter the United States illegally returned to its soil Monday, the country yesterday seemed to be betting its economy’s future on ethanol.

President of Honduras, Juan Orlando Hernández, inaugurated the first ethanol plant in Catacamas, the largest municipality in the Olancho Department in the east of the Central American country.

The initiative located at the headquarters of the National Agricultural University was supported by the Governments of the United States and Brazil and built  with the technical support of  the Organization of American States (OAS). It seeks to broaden the cooperation on biofuels in the Hemisphere.

A recently passed amendment to the country’s Biofuels Law defines as a priority the use and import of raw materials for the production of biofuels and provides a new price for electricity generated from forest biomass.

The Central American Free Trade Agreement (CAFTA) bill signed into law by President George W. Bush in 2005, carved out country-specific shares of CBI ethanol for Honduras, the Dominican Republic, Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua in the hopes of stimulating economic development in these countries.

The new Honduras ethanol plant.

The plant will utilize raw materials from the sugarcane produced by small farmers in the area, contributing to the thecnical development of this rural area of Honduras. The ethanol pilot plant is a major step towards the development of a sustainable bioethanol industry.

Secretary General of the OAS, José Miguel Insulza, was yesterday, July 15th, on hand for the inauguration and highlighted the importance for sustainable development and the energy independence of Honduras.

“Today we are witnessing something more than the inauguration of a plant, we are witnessing the commitment of a country – and the National Agricultural University – to develop the bases of the design of politics and sustainable regulatory frameworks for the use of biofuels,” he said.

He said the plant is a concrete action by Honduras toward development, to contribute to the diversification of its energy matrix and to create a series of alliances to promote clean energy and reduce the emission of carbon gas.

The main source of energy in Honduras as in most  Caribbean and Central American nations is petroleum (53%) followed by combustible renewable and waste (44%), and coal (3%).

The residential energy consumption is around 47% of the national consumption, of which 86% are provided by biomass, primarily firewood.

Electricity in Honduras is currently sold at an average price of 103 US$/MWh or 10.34 cents per KWh. The total cost including generation, transmission and distribution is calculated to be 127 US $/MWh or 12.75 cent per KWh. Due to the application of cross subsidies, specially applied to the residential sector, end users pay approximately 100 US $/MWh or 10 cents per KWh.

Sugar cane will provide the source for the fuel.

Still most of the electricity is concentrated in the western part of Honduras. The country has one of the lowest rural electrification rates in Latin America after Nicaragua.

About 54 percent of the rural population still lacks access to electricity. In absolute terms, it is estimated that more than 386,000 households or more than 1.93 Million people in rural areas remain without access to electricity.

ENEE (Empresa Nacional de Energia Electrica) owns 4 thermal power plants with a total capacity of 28.9 GWh. Additionally, 7 hydropower plants with a total capacity of 2,539.6 GWh are owned and operated by ENEE]. The private sector has a total capacity of 3,992.4 GWh (14 thermal power plants with 3,578.8 GWh, 13 private hydropower plants with 257 GWh and 8 biomass cogeneration plants with 156,2 GWh.