V. PUBLIC UTILITIES
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Energy
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1. As of October 1999 (one year after Hurricane Mitch), the National Electric Energy Company (ENEE) had invested Lps. 67.7 million (USD 4.7 million) in reconstruction and rehabilitation works. Many of these repair works were executed on a provisional basis in order to reestablish the electrical power service to all customers. To date, reconstruction related works executed by ENEE are as follows:
-- Generation: ENEE has conducted repair and protection works to damaged access roads, channels and side slopes. In addition, massive amounts of dirt and debris were also removed from around the Francisco Morazan (El Cajon), Canaveral and Nispero hydroelectric plants;
-- Transmission: By the end of 1998, ENEE had conducted provisional repair works to 36 kilometers of transmission towers (15 transmission lines in operation). To date, permanent repair works are still pending for three transmission lines due to the need for specialized manufacturing of spare parts;
-- High Voltage Substations: All five damaged substations have been repaired completely and permanently;
-- Distribution Lines: All 256 kilometers of damaged primary and secondary power lines, as well as 628 electric distribution transformers, have been repaired;
-- Electrification of Shelters: ENEE has contributed to the electrification of refugee shelters in San Pedro Sula, Tocoa and Francisco Morazan; financing for social electrification projects has been obtained from ENEE, the Central American Bank for Economic Integration (CABEI) and the governments of Norway, Japan and Korea.
TELECOMMUNICATIONS
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2. By January 1999, the state-owned telephone company, Hondutel, had restored almost 30,000 downed telephone lines, and rehabilitation for the remaining four percent of damaged lines is still pending. The remaining downed lines are in remote and depopulated areas where buildings had not yet been repaired, such as the community of Morolica, Choluteca, which was completely destroyed.
3. In 1999, the GOH requested international donations for three reconstruction projects:
-- Relocation of Tegucigalpa's La Vega Telephone Central, located in the heavily damaged Colonia San Jose de la Vega in Comayaguela (estimated project cost USD 4.1 million). (Note: Telmex, which was the sole company to bid during the failed attempt to privatize Hondutel in October 2000, eventually donated a telephone central switching station to replace the destroyed La Vega station. End note.);
-- Reconstruction of access roads, especially those leading to microwave repeating stations (estimated cost USD 900,000); and,
-- Repair of transmission, commutation, energy and external plant equipment and systems, including the acquisition of spare part units and modules, replacement of electronic cards, reconstruction of underground channeling, and building repair works (estimated cost USD 3.9 million).
4. Since the international community declined to fund these specific project initiatives, Hondutel proceeded to reconsider the execution of projects through internal financing and through the company's insurance coverage claims.
5. The damage caused by Hurricane Mitch to Hondutel's telecommunications network amounted to over 165 million Lempiras (USD 11 million), of which 152 million were claimed of the insurance company. In addition, Hondutel stopped receiving about 10 million Lempiras in revenue due to downed lines. Additional expenses incurred by Hondutel amounted to approximately 12 million Lempiras.
Water
and Sewage Systems
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6. Honduras' fragile water and waste water systems suffered heavy damage from Hurricane Mitch. According to the national water and sewage service (SANAA), Hurricane damage to rural water and sanitation systems has affected approximately 600,000 people. SANAA and local NGOs plan to rehabilitate a total of 1,469 rural water systems and install 20,000 new latrines before December 31, 2001. SANAA was able to obtain financing assistance from the IDB, CABEI, World Bank, USAID, UNICEF, the Swiss Development Agency (COSUDE), Florida Aquaduct, Honduras-Switzerland Counterpart Fund (Fondo Contravalor) and various other governments' NGO's. In addition, the Honduran population contributed to the execution of projects by providing needed labor for the various rehabilitation works. Reconstruction works in Tegucigalpa have had the most impact, given the size of the city's sewage system, its obsolescence and damaged condition.
7. From November 1998 to September 2000, SANAA had executed the following works:
a. Reconstruction of damaged offices and storage facilities in Tegucigalpa, as well as the replacement of tools and equipment (funds donated by USAID).
b. Repair of water sewage systems in 13 different departments (USD 932,000 donated by USAID).
c. Rehabilitation of 14 wells in Tegucigalpa and 2 in Choluteca, plus the acquisition of pumping equipment; COSUDE funds.
d. Repair of 250 rural water sewage systems in 13 departments (total cost of USD 2.2 million donated by USAID, UNICEF, FHIS and Honduras-Switzerland Counterpart Fund).
e. Acquisition of funds for the execution of a drinking water project for increasing the number of water reserve tanks and for rehabilitation of water pipe lines in the city of Tegucigalpa (initiated in December 2000, donated by the Government of Japan).
f. Improvement and rehabilitation of Tegucigalpa's drinking water and sanitary sewage system (USD 20 million from Government of Italy). This project will cover studies and reconstruction of the water conduit network of the Rio Choluteca, as well as the design and construction of the first wastewater treatment plant. Through this project, SANAA also plans to increase production of the Concepcion dam system. At present, this project is at the procurement stage for consulting services.
g. Signing of a USAID USD 14 million donation agreement (Letter of Intent) with SANAA for the reconstruction of 33 damaged sewage systems throughout the country. SANAA has completed work for 700 USAID-funded latrines at an advance rate of 10.84 percent and 28.34 percent within the program's schedule, respectively.
h. Rehabilitation of La Ceiba's sewage system and expansion of the Aurora, Alameda and Kattan networks in El Progreso.
i. Third phase of the Drinking Water Plant project to build and expand potable water plants in several cities (financed jointly with the Government of Spain).
j. Completion of studies pertaining to "Damaged Infrastructure Rehabilitation, Sustainable Water Service Supply and Sanitation in Minor Urban and Rural Areas, Stage I." These studies provide an analysis of sanitary conditions in 15 communities (IDB grant of USD 144,806).
k. Preparation of pre-investment and construction project portfolios, which have been submitted for financing consideration to different entities, such as:
-- Pre-investment request to the Government of Spain for the Quiebra Montes dam project in Tegucigalpa.
-- Pre-investment request to the Government of Japan for updating Tegucigalpa's Sanitary Sewage System Master Plan.
-- Financing search request to the Ministry of Finance for the elaboration of the following study: Environmental Management Master Plan for Tegucigalpa's Drinking Water Supply Hydro Basins. This study would be aimed at implementing measures for reducing the vulnerability of Tegucigalpa's sewage systems. Financing for this study is expected in the short-term, as it is considered a priority.
-- Financing search request to the Ministry of Finance of a "Centralized Management" project, dealing with sewage system operations in Tegucigalpa.
l. Financing search request to the Ministry of Finance for conducting final studies and design works in connection with "Damaged Infrastructure, Sustainable Water Service Supply and Sanitation of Minor Urban and Rural Areas, Stage II". This project will cover the studies and designs of sanitation projects based on the analysis from Stage I. This project is expected to benefit the following communities: Teupasenti, Monjaras, El Triunfo, Santa Cruz de Guayape, Campamento, Taulabe, Ajuterique, Pimienta, Cuyamel, Copan Ruinas, Florida, Villa San Francisco, Langue, Azacualpa and Morazan.
m. Reconstruction of a water conduit for Tegucigalpa and the construction of a waste water treatment plant that will serve 100,000 inhabitants in Tegucigalpa (EU financing). Through this project, SANAA also plans to cover the construction and reconstruction of rural sewage systems and basic sanitation projects.
n. Completion of a Drinking Water Master Plan Study for the city of Tegucigalpa, which proposes the construction of the Laureles II dam (Government of Japan grant of USD 3.0 million).
o. SANAA is about to complete Tegucigalpa's Water System Rehabilitation, Improvement and Expansion Project (SANAA-IDB 799). The project's final stage covers the construction of a 3 km water sanitation conduit for the Laureles dam; reconstruction of 8.7 km of water supply lines, and reconstruction of 26.3 km of the water distribution network.
p. Completion of Tegucigalpa's Sewage System Rehabilitation Project (San Juancito-Picacho) with World Bank funds (IDA-2816-2HO) (cost of USD 4.7 million)).
q. Rehabilitation of the Water and Sanitation Sewage System of Tegucigalpa (SANAA-BID 1029), at a project cost of USD 5.5 million.
r. Rehabilitation of the Drinking Water System of Tegucigalpa (SANAA-JICA), at a project cost of USD 11.4 million.
s. Water and Sanitation Feasibility Studies and Final Design Works for 22 cities (SANAA-BID 906), at a project cost of USD 2.9 million.
8. The Honduran Social Investment Fund (FHIS), through USAID's water and sanitation reconstruction program, is also playing a key role in the rehabilitation of the water sector. USD 72 million have been allocated for the following projects, which will benefit over one million people in 50 municipalities:
-- 26 water
systems in secondary cities;
-- 36 waste water systems in 36 secondary cities;
-- 24 sanitary sewage systems in secondary cities.
9. USAID plans to work with FHIS in the construction of permanent drainage and water and sanitation systems for 13 new communities, where 51,000 people affected by the Hurricane will be relocated. These new communities will be built in secure, less-vulnerable areas in the municipalities of Choloma, Choluteca, El Progreso, Guanaja, La Ceiba, La Lima, Moroceli, Puerto Cortes, San Pedro Sula, Sonaguera, Tegucigalpa, Tocoa and Trujillo.