Panela is a block sugar produced by small low-income farmers around the world. Evaporators used in the process are often inefficient and depend on firewood for fuel, which is costly and contributes to deforestation, This paper reports on the development of an evaporator in Honduras using a flue pan and improved oven that small-scale producers found lowered their fuelwood demand by 82% while reducing production time by 27% per day and 47% per unit of production. The evaporator can be built and maintained locally. Over 174 evaporators have been installed in Honduras since 2003, currently used by more than 2,000 small-scale producers. This study discusses the impact of the new evaporator based on a survey of 64 producers who have used the evaporator. The study found that fuel savings are sufficient to repay the cost of the evaporator, including interest, in 3 months of use. Panela projects using efficient evaporators can lower the environmental impact of smallscale sugarcane processing and increase rural incomes in many countries facing these challenges. Recommendations on how to structure and expand similar block sugar projects to increase sustainability close the paper.