Honduras' long-awaited 1500 MW tender is beginning to move forward. If Congress approves the National Electric Energy Company's (ENEE) electricity reform in early July as stipulated, the country will begin this year to draft and publish the bidding documents so that developers can prepare their offers and a potential contract award could take place in 2027, explained Héctor Corrales , commissioner of the Electric Energy Regulatory Commission (CREE).
"The idea is that it will be awarded in 2027. Once the law is passed, work will begin on the terms of reference and bases so that they can be launched this year, allowing bidders to prepare and any doubts to be clarified, in order to reach the award," Corrales stated in a dialogue with Energía Estratégica .
The definition brings certainty to a market that remained expectant after the postponement of the call, a decision that aroused concern in the sector about the possibility of prolonging dependence on emergency purchases and further delaying the incorporation of new generation capacity, in a context where Honduras lost ground to other Central American markets, such as Guatemala with the PEG-5, which advanced with new renewable projects.
The upcoming call for bids will also feature significant changes in its design. One of these will be the abandonment of the Build, Operate and Transfer (BOT) scheme promoted during the previous administration and a return to the traditional Power Purchase Agreement ( PPA ) model.
The final structure is still under review. According to reports, the government is working on defining contract durations, the allocation of space for different technologies within the call for proposals, and delivery deadlines.
"From a regulatory point of view, we are also analyzing the role and specific space that renewables and batteries would have," he added.
Regarding the contracting mechanism, Corrales clarifies that the bidding processes will continue to be public and international . What is changing is the contractual structure, as he believes the BOT model ultimately discouraged market participation.
In that regard, he argued that "the previous government's approach of conducting a seven-year BOT-type tender was a flawed scheme that discouraged participation in the process ."
The reform seeks to create conditions to recover investment
The bidding timeline is directly linked to the approval of the electricity reform, an initiative that proposes to restructure the sector's institutions to reduce political influence on the operation of the system and strengthen investor confidence.
Among the main changes are the creation of an independent operator , the reorganization of ENEE through subsidiaries under a commercial regime, greater autonomy for CREE , the opening of private investment in transmission and the incorporation of qualified consumers.
For Corrales, these changes are the foundation for attracting capital back to the country.
"As a whole, it is an absolutely necessary institutional reform to give confidence to investors," he said.
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Regarding the regulator, he explained that the project recovers some of the guarantees it lost with the modifications introduced during the previous government.
He explained that the selection of commissioners will once again be based on merit-based criteria and outside the political calendar . Furthermore, legal protections for officials would be reinstated, and the restriction preventing the CREE from financially sanctioning ENEE itself would be eliminated .
However, Corrales warned that institutional reform alone will not solve the state-owned company's financial problems .
The commissioner argued that the real challenge lies in reducing operating losses and rebuilding the distributor's ability to pay, whose debt continues to grow and is hindering new investments.
"You have to build investor confidence in payment by having a secure payment mechanism, or a guarantee instrument, so that invoices are never more than 45 days late," he said.
He also warned that, as long as this problem persists, suppliers will continue to add surcharges to cover financial risk , increasing the final price of energy.
In addition to the new generation capacity, the reform opens the door to private investment in transmission, a segment where Honduras has accumulated a significant lag and which will be key to supporting the growth of the system.
Corrales anticipated that there will also be opportunities for that segment.
"They should look at Honduras as an investment destination also for transmission tenders, which will come to recover all the backlog that the system has," he stated.
The official warned that not approving the reform would mean maintaining a model that he considers unsustainable from a financial and institutional point of view.
"The status quo survives, in which ENEE only continues to contribute to the growth of debt and the unsustainability of its operations," he noted.
Finally, he left a message for those considering investing in the country once the new framework comes into effect: "Wait until this new legal framework is approved, review it, talk to the institutions, and realize that it is there to serve the subscriber and the investor."