Event overview:

Future Hydro LATAM 2017 is a prime expo and conference focusing on the enormous potential within Latin America to derive electricity from its natural resources. The event will take place on 10/11 May 2017 in Lima, Peru.

Future Hydro LATAM 2017 will for the first time gather movers and shakers of the LATAM energy sector, becoming the major networking platforms for investors, OEMs, developers and consultants. Participants will be advised on the whole spectrum of Latin American energy sector, exhausting and potential opportunities, tendering process as well as pitfalls and bottlenecks be watch out for.

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Conference topics:

Peru’s significant small hydropower potential, defined as plants with capacity less than 20MW, is conservatively estimated at over 1,600 MW. In this regard, there is no solid basis for estimates of the technical potential of small hydropower (<20 MW) in Peru because of the lack of inventories of such resources. The main source of data on hydropower resources is the Hydropower Potential Study of 1979, which focused on identifying larger-scale projects for development by state-owned integrated- power-sector monopolies. These uncertainties notwithstanding, there is no doubt that Peru has considerable potential for small hydropower development. International experience has shown that wherever there are considerable water resources in hilly or mountainous terrain, developers have no difficulties in finding sites that are financially attractive—provided only that the tariff levels reflect full opportunity costs of other energy sources for generation and that the regulatory and institutional framework is rational.

  • The potential of small hydro power in Peru – Instituto Nacional de Recursos Naturales (INRENA) of the Ministry of Agriculture / The Dirección General de Electricidad (DGE) of Minsterio de Energía y Minas MEM
  • Addressing the most fundamental constraint to developing Peru’s hydro potential – the low tariff faced by generators
  • Making the development of small hydropower plants financially viable – Construction disbursement, debt-to-equity ratio and debt terms, loan maturity, depreciation, taxes, fees, own-consumption allowance, tariffs and project life.
  • The concessions and authorizations to be obtained from Minsterio de Energía y Minas MEM
  • Finding access to long-term financing for small hydropower projects
  • Understanding the risk factors specific for Peru and management
  • OSINERGMIN review the capacity charge methodology to fully capture the benefits of small and large hydro
  • Transmission cost, hydro is disadvantaged relatively to thermal generation from gas as transportation costs from the Camisea gas fields
  • Water rights difficulties as impeding the development of projects – can the issue be addressed by setting up new, transparent regulations for authorization of water use with a specific TUPA (Consolidated Text of Administrative Procedure)
  • Social assessment for hydro projects as the way to settle the rights-of-way by The Peruvian Electricity Law (LCE)
  • The implementation of early recovery of VAT policy
  • The development of small hydro potential can be complemented by medium-scale hydro projects. In the particular case of Peru, small hydropower below 20 MW has no particular economic or environmental advantage over medium-sized hydro in the 20 to 200 MW range.
  • Creating the inventory of the potential greenfield hydropower projects – Instituto Nacional de Recursos Naturales (INRENA) of the Ministry of Agriculture

Country profile:

Peru is the third-largest country in South America, after Brazil and Argentina. Its diverse terrain includes an arid coastline, high-altitude Andean mountains, and tropical rainforest in the Amazon basin.

Many of the Amazon River’s most important tributaries originate in the Peruvian Andes, such as the fast-flowing Marañón – identified as a major ‘energy artery’ by the government, with over 20 projects currently in the planning stage. The total hydropower potential in Peru is estimated to be approximately 70 GW, of which only 3.8 GW have been tapped so far.

2014 saw considerable progress on the planned Marañón developments. The government granted final and definitive concessions for both the Veracruz (730 MW) and Chadin 2 (600 MW) projects to respective developers Enersis and AC Energia, a subsidiary of Odebrecht.

Other recent developments include completion of the Huanza project, which brought 92 MW of installed capacity online in September 2014. The USD 1.2 billion Chaglla plant (406 MW), currently undergoing the Hydropower Sustainability Protocol Assessment, is expected to commence operations in 2016.

While sustained economic growth in Peru averaged over 6 per cent per annum in the last decade, extreme poverty and a lack of access to modern water and energy services continue to present considerable challenges, particularly in remote areas.

Sustainable hydropower projects are nonetheless contributing to wider social and economic development, bringing jobs, investment, and improved infrastructure to rural areas.

For example, two new hydropower facilities (totalling 27 MW), currently under construction in the Monzόn valley, are expected to bring benefits and further opportunities to the local economy, following a recent government-led coca eradication programme.

According to the International Renewable Energy Agency (IRENA), demand for electricity is expected to grow at an average rate of 8.8 per cent per annum until 2017, necessitating investment of more than USD 5 billion in electricity generation and infrastructure by 2016.

These investments will contribute a further 4,300 MW to the country’s power mix, including 1,400 MW of installed hydropower capacity.

Last year, Peru finalised its National Energy Plan 2014 – 2025, which calls for the electricity mix to include 60 per cent renewables by 2025 (54 per cent hydropower and 6 per cent other renewables). Both large- and small-scale hydropower projects will form part of the country’s strategy to meet this pledge.

Since 2010, the government has signed power purchase agreements (PPAs) for no less than 44 small hydropower plants (less than 20 MW each) amounting to a total 391 MW of installed capacity.

In order to ensure the participation of renewables in the future energy mix, the government has announced it will promote an auction to buy 1,200 MW of firm energy from new hydropower plants.

Peru has also become a regional leader in renewable energy auctions, promoting biomass, wind, solar and small hydropower projects.

The first two auctions, held in 2009 and 2011, awarded 281 MW of small hydropower contracts to developers. The results of the third auction were announced in December 2013, and included the awarding of 16 hydropower projects which will contribute 1,278 GWh per year upon their completion.

Why attend:

  • A fully packed programme of high profile speakers
  • Excellent networking with the who’s who of the regional and international hydro energy industry
  • Technology update in the exhibition area
  • Extensive finance advice on developing commercially bankable hydro energy projects with case studies
  • Learn about local hydro energy development and profitability
  • Hear from and meet top hydro energy experts

Target group:

The event is best suited for senior officers and executives with responsibilities in the financing aspects and decision-making processes related to hydropower projects.