Mr. Ron Turner
La Esperanza, a run-of-the-river hydroelectric project located in the waters of Intibucá River, was established in 2001 to reduce energy shortages in Honduras. Honduras has long faced shortages of energy capacity; most vividly in 1994 when energy was rationed out leading to ?brownouts? of up to 12 hours a day. As a result of this emergency, the Energy Law was passed in 1994 allowing the participation of the private sector in energy generation. Ron Turner, the General Manager of La Esperanza, seized the opportunity to provide renewable energy by using an existing hydroelectric structure. Currently, La Esperanza sells 13.5 megawatts of energy to the utility and displaces approximately 35,000 tons of greenhouse gases annually. Additionally, Mr. Turner has committed to develop forestry and land protection programs around the river basin, clean the garbage from the lake area and generate local direct and indirect jobs. Further, La Esperanza electrifies the local village.More recently, La Esperanza has funded a tree planting program in the surrounding community. Last year, Mr. Turner and local community members planted over 30,000 trees that were donated by La Esperanza. With the help of E+Co, La Esperanza will begin selling their carbon offsets from this program in 2007.
La Esperanza sells hydropower to the national utility in Honduras. In 2003, La Esperanza rehabilitated an abandoned 500 kilowatts hydro facility; during 2004 they expanded the project to 1.5 megawatts, adding Phase 1B, a 1 megawatt plant. In August, 2006, Phase II began operations adding 12 megawatts for a total 13.5 megawatts of capacity.La Esperanza is innovative in its use of private sector entrepreneurship to provide clean energy in developing countries. La Esperanza is not a government created program, nor is it a short term project. It is a medium sized enterprise that through strong management and a sound business plan is providing clean energy to hundreds of people in a sustainable manner.
La Esperanza is a viable and replicable enterprise that creates significant social and environmental benefits through the provision of sustainable energy. By providing hydropower to the utility, La Esperanza displaces over 35,000 tons of greenhouse gas emissions annually. Yet, La Esperanza does more than provide sustainable energy to the utility, it also voluntarily participates in a reforestation and carbon offset program. Last year, for example, La Esperanza donated 30,000 trees, which were then planted by community members in and around the village. Soon, La Esperanza will begin selling their carbon credits through E+Co?s Erase Your Footprint Program.La Esperanza also has a high replication and growth potential, and Mr. Turner plans to develop other small and mid-sized power generation facilities in Central America. For example, negotiations are currently underway to develop Agua Blanca, a new hydroelectric project located down stream from La Esperanza.La Esperanza would benefit greatly from the Clean Energy Award. More importantly, however, I believe that the sustainable energy movement will greatly benefit from learning about the efforts of La Esperanza. It is valuable project that if properly publicized, may encourage similar schemes throughout the developing world.
To begin operations, La Esperanza obtained a twenty-five year land concession from the municipality who owns the project site. E+Co then loaned La Esperanza US$250,000, which was necessary to leverage third party investments from financial institutions. Subsequently, La Esperanza secured loans from several sources including, a BCIE loan for US$6 million and a BGA loan for US$2.8 million.Mr. Turner, through a carefully constructed business plan, has successfully leveraged significant amounts of third party investments. Many potential sustainable energy enterprises have difficulty in raising enough start up capital to launch their clean energy ideas. La Esperanza, demonstrates that the partnership between non-profit organizations, such as E+Co, financial institutions, such as BCIE and an entrepreneur, such as Mr. Turner, can create a sustainable solution to clean energy provision.
Qualitatively, La Esperanza supplies a higher quality of life to its surrounding community. The hydroelectric facility supplies energy to La Esperanza, Honduras, the second poorest district in the country. Ron Turner also organizes community development programs, such as the reforestation project. Finally, La Esperanza is the largest employer in the community.Quantitatively, La Esperanza offsets over 35,000 tons of greenhouse gases each year by providing hydro-generated energy to the national utility of Honduras. Hydro power is replacing kerosene, candles and firewood. The business employes 148 people, many of whom are women. 622 households are supplied with clean energy. In 2007, La Esperanza plans to plant 60,000 new trees.
La Esperanza has served as a showcase for renewable energy projects on all fronts:Environmentally speaking, the project has an important impact on the offset of CO2 on a highly thermal plant concentrated country. Its reforestation programs and basin management deliver further environmental impacts to the community.In the social area, the project currently provides almost 150 jobs, which helps develop the small communities in which the project lies. Financially the project is a success, delivering a well balanced construction cost integrating social and environmental compliances. Generation has been accordingly to forecasts made prior to Phase I construction, facilitating the repayment of all obligations even when construction of Phase II is taking place and might be capital intensive. As for E+Co, financing of this project has delivered several triple bottom line impacts, and is expected to deliver furthermore upon Phase II being operational during 2006.
The entrepreneur holds a little more than $2 million in La Esperanza Hydroelectric Facility. E+Co's initial investment of $250,000 was able to leverage an additional $8.8 million of investment from third parties.Clean energy enterprises are able to provide alternatives to fossil fuel usage in developing countries in a sustainable way. These enterprises, however, require start up capital in order to leverage third party investments and begin operations.