Peru's energy and mining regulator Osinergmin has recently awarded 20-year contracts to 13 renewables projects totalling 430MW, covering almost 100% of the electricity on offer.
Enel Green Power (EGP), acting through its subsidiary Enel Green Power Peru, has been awarded the right to sign 20-year energy supply contracts for 126 MW wind power, 180 MW solar PV and 20 MW of hydro capacity following the renewable tender launched by the Peruvian government.
With 326 MW awarded in the tender, EGP will become by 2018 the main renewable player in Peru and the only company operating plants of three different renewable technologies in the country.
EGP CEO Francesco Venturini said:
“This tender marks Enel Green Power's entrance into Peru, confirming the success of our growth strategy in Latin America. These results also illustrate how renewable energy can be competitive with traditional generation even in geographies where its development is still in the early stages. Renewables provide diversification in a country's energy mix, making the energy system more resilient and better focused on addressing the challenges posed by climate change."
EGP will be investing approximately US$400 million in the construction of the renewable facilities, which are expected to enter into operation by 2018, in line with the investments outlined in the company’s current strategic plan.
The 20-year supply contracts awarded to EGP provide for the sale of specified volumes of energy generated by the plants.
Nazca wind project will be built in the Marcona district, which is located in Peru’s southern coastal area, more specifically in the Ica department, an area blessed by high level of wind resources. This project, with a total installed capacity of 126 MW, once up and running, will generate about 600 GWh per year, while avoiding the emission of around 370,000 tonnes of CO2 into the atmosphere.
The 180 MW solar PV project Rubi will be built in the Moquegua district, which is located in Peru’s southern area, more specifically in the Moquegua department, an area which enjoys high levels of solar radiation. Once up and running, the solar facility will generate approximately 440 GWh per year, while avoiding the emission of around 270,000 tonnes of CO2 into the atmosphere. Enel received the contract to provide 415GWh of solar power per year at a set rate of US$47.98/MWh in the auction.
The hydro project Ayanunga, whose capacity amounts to an approximate 20 MW, will be built in the Monzón district, which is located in Peru’s central area, more specifically in the Huànunco department. Once up and running, the hydro plant will generate annually about 140 GWh, while avoiding the emission of around 109,000 tonnes of CO2 into the atmosphere.
The auctions also include the following winning projects:
The three wind farms with capacity totalling 162MW, which were awarded contracts with an average price of $37.79/MWh — "the lowest price awarded to wind projects in Latin America in recent years", the government agency highlighted.
Grenergy's projects are located in the department of Cajamarca and, according to the announcement, benefit from an excellent wind resource of over 5,000 equivalent hours. They are entitled to a 20-year dollar denominated power purchase agreement (PPA) indexed to the consumer price index (CPI). Grid connection is slated for 2017.
Peru has a vast renewable potential which is still largely unexploited. The tender is part of the country’s efforts to diversify its energy mix by increasing the share of renewables up to 5% from the current 2% by 2018, in line with the targets set out by the 2008 Legislative Decree 1002.