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Construction of a hydropower project in Peru


Peru statistics

1,280,000 sq km
Installed hydropower capacity: 
5,385 MW (2017)
Hydropower generation: 
33,400 GWh (2017)

Peru’s government has set a goal to become energy self-sufficient by 2040. The National Energy Policy 2010-2040 outlines its aim to achieve a diversified energy mix with a rising share of renewables, contributing to lower carbon emissions.

In 2017, Peru’s installed capacity in hydropower climbed 200 MW to 5,385 MW.

The hydropower sector generates about 50 per cent of electricity for the National Energy Interconnected Grid (SEIN). Yet, the total hydropower potential capacity is estimated at around 70,000 MW. Thermal energy leads way, providing around 9,500 MW of installed capacity, while wind and solar together provide only 3 per cent.

The Amazon basin region holds 97.7 per cent of Peru’s water resources where about a quarter of the population lives. Access to electricity in urban areas is close to 90 per cent, while in rural areas it is around 78 per cent.

The National Energy Plan 2014-2025 developed by the Ministry of Energy and Mining (MINEM) expects Peruvian energy demand to grow between 4.5 to 6.5 per cent a year by 2025, which will be satisfied primarily by hydropower and growth in other renewable energies. The investment required to cover the expected generation ranges from USD 6.7-7.3 billion.

In 2008, the government already established a decree to cover the energy demand by incentivising non-conventional renewable energy resources – so called RER – which includes solar, wind, biomass, geothermal and hydropower below 20 MW of installed capacity.

By 2040, Peru aims to increase the contribution of RER to the energy matrix from 5 per cent to at least 20 per cent.

Recent years have seen four RER auctions for the National Energy Interconnected Grid (SEIN) and one for other areas not connected to the SEIN. As a result of these auctions, 22 hydropower plants are under construction (292.48 MW) and 23 are already in operation (274 MW). In April 2017, the Ministry cancelled a fifth auction scheduled for 2018 because several projects from previous auctions were still being developed.

During 2017, the 19.9 MW Potrero plant entered into operation in April, followed by the 18.4 MW Marañón project in June and 17.5 MW Yarucaya project in August. By the end of2017, the 20 MW Renovandes H1 project, the 84 MW La Virgen project and the Angel II and Angel III plants (19.9 MW each) are also expected to enter in operation.

The 2017 increase in installed hydropower capacity of 200 MW was a fifth of the 1,033 MW that entered into operation in 2016. Most of the previous year’s increase was accounted for by two new commissioned major projects, the 456 MW Chaglla plant and the 510 MW Cerro del Águila plant.

There now are 39 hydropower projects – including the RER hydropower projects – in the pipeline which will together add an additional 2,900 MW by 2023. The largest of the 39 hydropower projects are Veracruz and Chadin II, both on the Marañón river, at 635 MW and 600 MW respectively.

In August 2017 it was announced that the 456-MW Chaglla, owned by Odebrecht, was purchased by a Chinese consortium led by China Three Gorges (CTG). The hydropower plant is CTG’s first asset in Peru and the first plant to apply the Hydropower Sustainability Assessment Protocol in the country.

Large transmission lines are needed to connect hydropower plants to electricity demand centres in the dry Pacific coastal areas inhabited by much of the rest of the population. The Ministry of Energy and Mining is fostering, through the RER framework, investment in rural electrification through off-grid auctions which, it is estimated, will benefit 3.4 million people by 2025.

This country profile is featured in the 2018 Hydropower Status Report. Download the full report here.

This profile was last updated in June 2018.