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French Renewable Developer Signs 25-Year PPA

(Credit: Total Eren)

Total Eren, a renewable energy company based in France, has purchased one of the largest wind farms in Honduras and entered into a 25-year agreement with the country’s national utility for the sale of power. Under the agreement, the newly acquired San Marcos project, which has a capacity of 112MW and is located in the southwestern region of Honduras, will sell all of its output to the National Electricity Energy Company (ENEE) in Honduras. 

The project also includes a 230 kV substation and a 95 km-long 230kV transmission line. 

It is not yet known when construction of the project will start when it will be fully operational, or what turbines are to be used. However, Total Eren told Windpower Monthly that the project is at a late stage of development and that the developer plans to use turbines with power ratings of more than 5MW each.

Total Eren claimed its purchase of the proposed 112MW wind farm amounted to one of the largest foreign investments in a renewable energy site in Central America. 

On completion, the San Marcos wind project is expected to generate 500GWh per year – enough to provide electricity for approximately 460,000 people in Honduras, Total Eren claimed. 

Recently, renewable energy developers have been having a difficult time keeping up with demand in North America, and that is leading to a shortage of power purchase agreements (PPA) as well as increased prices.

According to a report by LevelTen Energy, the imbalance between supply and demand as well as increasing development costs have resulted in PPA prices increasing by nearly 10% in the first quarter of 2022. That equals nearly $40 per megawatt hour. Year-over-year, that equals a 28.5% increase. 

Additionally, the share of Latin America sustainability-linked bonds is 30%, far surpassing the global share, a report by S&P Global Ratings says. The report estimates that the region will maintain that high share in the short and medium terms, especially with increased interest from industries to meet investor demand and pressure regarding sustainability concerns in the region. 

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