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Honduras Electric Power
Honduran electrification is low and uneven relative to
other
countries in Latin America. The World Bank estimates that
only
about 36 percent of the Honduran population had access to
electricity (20 percent of the rural population) in 1987.
The
country's total capacity in 1992 was 575 megawatts (MW),
with 2,000
megawatt-hours produced. A mammoth hydroelectric plant,
the 292-MW
project at El Cajón, began producing electricity in 1985
to help
address the country's energy needs. The plant, however,
soon became
heavily indebted because of the government's electricity
pricing
policies (not charging public-sector institutions, for
example) and
because of the appointment of political cronies as top
management
officials. El Cajón also developed costly structural
problems
requiring extensive maintenance and repairs. Officials
estimated
that the government's decision to provide free service to
publicsector institutions contributed to a 23 percent increase
in publicsector consumption in 1990. Experts estimated that
additional
electrical generation capacity would likely be needed to
keep pace
with demand. The Honduran Congress assumed authority for
setting
electric prices beginning in 1986 but then became
reluctant to
increase rates. Under pressure from the World Bank, it did
agree to
a 60 percent increase in 1990, with additional increases
in 1991.
To offset these increased rates for residential users, the
National
Congress initiated a system of direct subsidies that ran
through
1992.
Data as of December 1993
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