The Peruvian Congress has approved amendments to Law 28832 (2006) on the efficient development of electricity generation, allowing all power generation technologies available in the country - i.e. hydropower, thermal, solar, wind, biomass and others- to compete transparently in electricity supply tenders. The amended law also establishes the framework for distribution companies to carry out short-term (up to 3 years), medium-term (up to 5 years) or long-term (up to 15 years) electricity supply tenders, to ensure sufficient electricity supply to their regulated users.
This law is expected to contribute to diversifying the power generation matrix of the country, taking advantage of the country's potential in non-conventional renewable energies and improving energy security, in a context of water deficit. Peru's power mix currently relies on hydropower (47 to 57%) and gas (35 to 45%), with other energy sources accounting for less than 10% of the power mix). The law should also make the electricity market more competitive through an improved integration of low generation cost renewables and prevent the upward trend in electricity rates from continuing in the future.
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