Energy Alert – January 2025

Law No. 32249 was approved, which amends Law No. 28832, in order to guarantee the efficient development of electricity generation

On January 19, 2025, Law No. 32249 was published in the Official Gazette “El Peruano”, which amends Law No. 28832, in order to guarantee the safe, reliable and efficient supply of electricity and promote the diversification of the energy matrix.

• Possibility of signing contracts for power or energy separately: Non-conventional renewable plants (e.g., solar and wind power plants) have limited recognition of firm power, which prevented them from competing on equal terms to sign contracts. With the modification, all generators are allowed to sign contracts with free users and distributors only for power or energy, up to the limit of their own firm power or energy or that contracted with third parties.
• Rules applicable to distributors’ bids: Distributors may bid for the purchase of power or energy separately or jointly. To this end, distributors must schedule and update annually the bids to be called for the following 10 years, taking into account the new deadlines for the start of the bids and for the duration of the contracts[1]. This schedule will be binding and its modifications will require the approval of OSINERGMIN.

Through a regulatory provision, MINEM will establish an energy or power distribution mechanism so as not to affect existing contracts with distributors. At the same time, the biddings in progress must be adapted to the new provisions.

• Prohibition of extension and increase of quantities of current contracts: Existing contracts may not be extended and committed quantities may not be increased.
• New reference to determine the Bar Tariff: In addition to the bidding prices, it is added as a reference that the bar price at generation level may not differ by more than 10% of the weighted average price of the contracts with free users. Existing contracts that are subject to the Bar Tariffs will continue to apply the previous regime.
• Complementary Services Market[2]: The figure of Complementary Services Provider is created as that agent that, being able to be different from the generator, transmitter, distributor or free users, will have an enabling title to provide complementary services. Those who provide these services will be compensated by the agents that generate instability in the electric system.

The regulation of the Complementary Services Market will be effective as of January 1, 2026.

• Coordination of the operation in isolated systems: The MINEM may entrust the COES with the coordination of the operation of the least cost dispatch in isolated systems in which two or more generators operate.

The MINEM and the OSINERGMIN must approve the necessary regulations by May 19, 2025 at the latest, within 120 calendar days from the effective date of the law.

[1] The new terms of anticipation and duration of contracts are as follows: minimum anticipation of 3 years for contracts with a maximum duration of 15 years; minimum anticipation of 2 years for contracts with a maximum duration of 5 years; minimum anticipation of 1 year for contracts with a maximum duration of 3 years; and contracts without bidding up to the limits established by the Regulations.

[2] The provision of complementary services is necessary to ensure the transport and supply of electricity from generation to demand, under conditions of safety and quality.

For further information, please contact Veronica Sattler (vsattler@estudiorodrigo.com), Alejandro Manayalle (amanayalle@estudiorodrigo.com), and/or  Milene Jayme (mjayme@estudiorodrigo.com).