Peru to award 1,100MW hydro concession in 2015

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Wednesday, April 23, 2014

Peru plans to award a 30-year concession to build and operate a 1,100MW hydroelectric plant in the first quarter of 2015.

The proposed power plant, whose location has not been determined yet, will cost about US$2.5-2.7bn to build, said Manuel Suarez, an advisor to Proinversión, the state agency in charge of promoting private investment.

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"We're just waiting for the concession process to be ratified by the energy and mines ministry and then we'll call for bids," Suarez said Wednesday at a renewable energy forum organized by the Scandinavian-Peruvian Chamber of Commerce. "We'll facilitate the investment by guaranteeing energy purchases."

Peru, which plans to award US$10bn this year in concessions including energy projects, seeks to line up investment in power plants and transmission lines to handle power demand, which is growing at an estimated 8%/y.

Proinversión, which awarded three power line concessions this month and two gas-fired power plant concessions in December, has lined up 31 concessions to be awarded over the next two years.

Peru's mining industry needs an additional 4,000MW in energy to supply new mines and expansions over the next decade, the then deputy mining minister Rómulo Mucho said in February

The mining industry accounts for one third of the country's 37,000GWh demand, projected to rise to 45,000GWh by 2021, Mucho said. Miners, who have lined up US$60bn in investment commitments over the next decade, require 700MW/y in additional generating capacity, he said.