Peru power distributors told to join forces

Monday, February 20, 2017

"Not having credit facilities and being able to compete like any private company of the sector, represents a big barrier that limits the development of investments in power infrastructure that these companies need to carry out."

That's according to Peru opposition party Acción Popular, which introduced a bill in congress that looks to create a holding group for state-owned electricity utilities that serve the east and south of the country.

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The state companies need to be merged or grouped together to generate economies of scale to improve efficiency and service, argue the bill's authors.

The bill targets Electro Puno, Electrosur, Electro Sur Este, Electro Ucayali, SEAL and Electro Oriente, which are controlled by state business financing fund Fonafe.

The service providers would have access to financing for up to 15 years and the holding's board would be composed of the utilities' directors, each of whom would rotate as chair.

ALSO READ: Does Peru need a new state power company?