Peru is at risk of having expensive electricity rates

He light bill It is not the same. A year ago, a user paid S/ 100, now they pay double. This increase is attributed to the exchange rate and the prices of natural gas and diesel, to which the rate is indexed. If these variables move rates also, up or down.

The former vice minister of Energy and Mines, Pedro Gamio, estimates that this panorama could worsen next year due to the lack of water for the plants to function. hydroelectric. When a citizen turns on a computer or a television, he often does not wonder where that comes from. energy. This is obtained from hydroelectric plants and thermal plants that run on gas or diesel oil, although there are also solar and wind sources to a lesser extent.

According to the Supervisory Body for Investment in Energy and Mining (Osinergmin), until April of this year, 60.1% of electricity production came from hydroelectric plants, 33.9% from natural gas, 5.8% from renewable energies and 0.2% with other sources.

Compared to the same period in 2022, hydraulic energy decreased by 9.7%. There are weeks when this gap increases to 20%. What is currently happening? Hydraulic facilities are operating at half their operational capacity due to reduced river flows. One of the most important hydroelectric plants in the country is the Mantaro.

This can generate a thousand megawatts. Today it only produces 400. In the El Niño phenomena In the 1980s and 1990s, electrical service was rationed due to the high dependence on water in energy generation. To counteract this vulnerability, a combined scheme has been promoted: hydroelectric plants and thermal plants, in almost the same proportion.

Although it is unlikely that power outages will be repeated, prices could vary radically due to water stress. At some point during the year, up to 20% of the energy in the country has been generated from diesel oil. That is expensive and not competitive, according to Pedro Gamio.

Sources consulted by this medium indicate that moving a turbine with water costs three times less than starting a diesel engine. In the spot market, the price of a megawatt has increased from $30 to $178 in less than a year due to dependence on diesel.

Gamio maintains that the entities responsible for the electricity sector in the country have not foreseen the risk of climate change and its impact on energy generation. There is a crisis, but few talk about it.

Will the light be more expensive?

In the energy sector, there are two types of users: free customers and regulated customers. The free ones, which include large companies, mining companies and industries, directly acquire energy from the generators. According to Gamio, this group made up of 3,000 consumers You will feel the impact when your contracts expire and generators apply spot market prices.

Then those customers will increase their production costs, become less competitive, and probably pass the final price on to the market. There are versions that some generators have already broken contracts. They cannot provide the megawatt at $38 when today it is worth $178. They are at a loss.

Regulated customers, who are around 8 million Peruvians, receive electricity from distributors. These companies buy it through bidding processes. Likewise, when the contracts expire, they will have to pay the new rate.

The new tenders are planned between 2025 and 2026. The engineer specializing in electrical issues, Carlos Gordillo Andia, maintains that the possibilities of generating energy with water are reduced during the drought, and that the water priority is human consumption.

In that sense, the south has serious generation problems. It needs 2,000 megawatts and only produces 450. If there were no interconnected system, the situation would be critical. Ordillo recalls that there are thermal generation plants such as Samay, installed in the province of Islay, and another in Ilo (Moquegua), both with a capacity of 720 megawatts.

They currently operate on diesel. That means one sol per kilowatt hour, when the flat rate is 0.62 soles. In this context, Gordillo points out that there is likely to be an increase in electricity rates for next year due to the need to resort to diesel when there is not enough. water for hydroelectricity. Gas-fired thermal plants, such as Kallpa, Fénix and Chilca, are operating at maximum capacity.

The former Vice Minister of Energy, Luis Espinoza, highlights the urgency of reviewing the implementation of a pipeline to transport gas to the south of Peru. This would lower costs and would also allow us to have energy security and avoid concentrating it in a single point, such as the center of the country.