Honduras’ “green” energy model is based on dispossession, study warns, as Honduran Congress prepares to privatize the NationalElectrical Energy Company (ENEE)

For immediate release

Tegucigalpa, Honduras — As the National Congress prepares to resume its third and
final debate today on reforms to the General Law for the Electricity Industry, a group
of national and international organizations has released a new report: “The Dark Side
of the Energy Transition: Green Colonialism in Southern Honduras.”

The report—prepared by the Network of Women Human Rights Defense Lawyers
(RADDH), the Southern Social Environmental Movement for Life (MASSVida), the
Institute for Political Studies, the Transnational Institute, TerraJusta, and the Honduras
Solidarity Network — warns that the energy reform revives and deepens the model sold
to the country in 2014: Private energy generation, distribution, and transmission under
the guise of sustainability that leads to environmental, social, and economic
harm to affected communities, ensures exorbitant guarantees to private investors, and
treats access to electricity as a commodity rather than a human right.

The report focuses on the Los Prados solar project in Namasigüe, Choluteca, owned by
Norwegian companies Scatec, Norfund, and KLP Norfund Investments. The contracts
for this project were approved piecemeal to avoid a serious environmental assessment
and with evidence of corruption and irregularities, which have never been properly
investigated. Communities report that this project has led to deforestation,
displacement, loss of productive land and water sources, rising temperatures, and
social conflict in the areas where the solar parks were installed. Furthermore, for more
than eight years, Scatec has pursued criminal charges against 10 human rights and
environment defenders who oppose the Los Prados project due to the harm it has
caused their communities.

Such deleterious, repressive and mafia-style behavior is evident with other solar
energy projects in the south and other forms of renewable electricity generation,
including hydroelectric dams. The experience of the Civic Council of Popular and
Indigenous Organizations of Honduras (COPINH) and the Agua Zarca hydroelectric
project — financed in part by the Dutch development bank FMO with ties to companies
associated with David Castillo, who was convicted of the murder of our colleague Berta
Cáceres — involves similar tactics, mafia-style practices, and impunity.

The Honduran people have already paid a heavy price for this model. Our report
identifies seven transnational firms in the energy sector that have filed international
arbitration claims, known as Investor State Dispute Settlement or ISDS, against
Honduras, seeking hundreds of millions of dollars in compensation. The Norwegian
companies brought claims for $400 million against Honduras at the International
Centre for Settlement of Investment Disputes (ICSID) under the Investment Promotion
and Protection Act passed in 2011. These ISDS suits gave them leverage during the
renegotiation of their contracts. Proof of this is that, once the negotiations concluded,
the companies withdrew their claims. Nonetheless, five claims against the Honduran
people remain pending, totaling more than one billion dollars — an amount greater
than the former administration estimated would be saved from renegotiating solar
energy contracts. The funds that companies are claiming could be better used to
improve the electrical grid and service for the population.

We are deeply concerned about what is taking place and stand in solidarity with recent
protests of campesino and indigenous organizations in response to the current
administration’s prioritization of private-sector interests through the Law to
Strengthen and Protect the Agroindustrial Sector, Energy Projects, Tourism, Livestock,
and Small-Scale Agricultural Producers in Honduras. Along with the possible passage of
energy reforms that will further privatize the ENEE — at great cost to the public purse
and likely worsening electricity service for the people — these laws open the door to
further imposition of projects on community lands and territories, backed by legal
frameworks that punish social protest and resistance.

In conclusion:

We demand that Scatec immediately cease the criminalization of the ten land and
environment defenders and provide full reparations for the harm suffered.

A serious, full and impartial investigation is urgently needed into the environmental,
social, and economic damages, as well as the corruption and links to organized crime
related to the Los Prados project and other renewable energy projects in Honduras.

We call for the repeal of the Law to Strengthen and Protect the Agroindustrial Sector,
Energy Projects, Tourism, Livestock, and Small-Scale Agricultural Producers in
Honduras.

We express a resounding “no” to the privatization of the energy system, which is
being presented as a process of so-called modernization.

We denounce Honduras’s return to the ICSID convention, announced on day one of
the current administration and set to take effect on August 16, 2026. Withdrawing
from ICSID is not sufficient to protect the country against ISDS claims from
transnational corporations. It is a first step, however, toward recovering sovereignty
over needed decisions in the public interest.

There is an urgent need for an energy model and a truly just energy transition under
public and community control, based on energy justice and democracy, that
prioritizes a healthy environment, social equality, the needs of communities, and the
guarantee of collective rights — especially the self-determination of campesino
communities, and Indigenous and Afro-Indigenous Garifuna peoples — ensuring
respect for their decisions at all times.

Throughout the Global South, the climate emergency is being used to justify
transnational investments that repeat colonialist patterns of dispossession. These
investments are protected by legal frameworks that allow corporations to punish
governments that dare to regulate in the public interest, while at the same time using
the state to repress and criminalize peoples and communities in resistance. Like in Los
Prados, and the rest of Honduras, affected communities are resisting interests of local
and mafia-style elites acting in association with foreign investors, defending their
territories, their health, and the environment from extractivism in the form of solar
panels.

Issued on July 21, 2026, in Tegucigalpa, Honduras

Signed by: the Network of Women Human Rights Defense Lawyers (RADDH), the
Southern Social Environmental Movement for Life (MASSVida), the Institute for
Political Studies (IPS) – Global Economy Program, the Transnational Institute (TNI),
TerraJusta and the Honduras Solidarity Network (HSN).

Read a summary PDF.

Download a PDF of the full report.

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Lea este comunicado de prensa en español.