Background

Peruvian economic development in recent years has led to a rapid increase in electricity demand from companies and households. This sharp growth requires considerable investment to maintain the balance of the system. In addition, domestic generation continues to lack diversification and is largely dominated by gas-fired thermal power plants and hydropower.

In 2008, Peru set out to ensure its energy security, while reducing its dependence on gas and the sector’s carbon footprint, by developing its strong renewable energy potential, especially wind energy. The private sector is playing a crucial role in this strategy by providing over 70% of investment.

The project

In 2011, EDFI members allocated USD 14.4m to the independent power producer Grupo T-Solar to build and run two photovoltaic power plants (44MW) in Peru’s southern Arequipa region.

T-Solar was the first major photovoltaic solar-power project in Latin America. It has also been considered an example of best practice in international funding. Following the environmental and social (E&S) assessment of the project, the initial perimeter of the site was modified to protect the nearby archaeological remains. T-Solar has also pledged to implement E&S measures, such as workers’ safety or waste management.

Impact

• Generation of 80GWh per day equal to the consumption of a town of 80,000 inhabitants
• 40,000 teqCO2 per year avoided
• 160 direct jobs created during the construction phase
• Increased revenues for local administration (tax on project revenues)

Photo credit: © Grupo T-Solar