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  old 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:

1. We demand that Scatec immediately cease the criminalization of the ten land and environment defenders and provide full reparations for the harm suffered.
2. 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.
3. 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.
4. We express a resounding “no” to the privatization of the energy system, which is being presented as a process of so-called modernization.
5. 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.
6. 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  ransnational Institute (TNI), TerraJusta and the Honduras Solidarity Network (HSN).

Read a summary PDF.

Download a PDF of the full report.