Improving the public power supply with renewable energies

Project description

Title: Electricity Distribution 4.0
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)​​​​​​​
Country: Peru
Partner: Ministry of Energy and Mines (MINEM) in Peru​​​​​​​
Lead executing agency: Selected public energy utility companies, the Ministry of Energy and Mines MINEM, the regulatory authority OSINGMIN (Organismo Supervisor de la Inversión en Energía y Minería) and the state-owned umbrella company FONAFE (Fondo Nacional de Financiamiento de la Actividad Empresarial del Estado).​​​​​​​
Overall term​​​​​​​: 2019 to 2024

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Context

In the Peruvian energy sector, there are currently few incentives for using more energy from renewable sources. In addition, public utility companies lack the human and financial resources to implement the necessary modernisation measures. This leads to a poor power supply and restricts companies in terms of meeting future challenges.

Objective

By laying appropriate regulatory, institutional and technical foundations, public utilities can increase energy efficiency and integrate renewable energies. The population benefits from a safe, environmentally friendly and cost-effective power supply.

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Approach

The project supports state decision-makers in improving the legal and institutional framework conditions for expanding the use of renewable energies. In the process, it advises the ministries on investment guidelines and calculation methods for distribution network tariffs, as well as on renewable energies and energy efficiency. This enables them to achieve selected climate targets.

The project also advises three utility companies on preparing and implementing investment plans and developing new strategies. To this end, it is evaluating and implementing new pilot projects to test new business models that pinpoint alternative financing and investment opportunities. Here, the participants are also developing a technological roadmap for modernising distribution networks.

Moreover, an improved exchange of knowledge and information is intended to facilitate cooperation between utility companies and strengthen the industry. For this purpose, the project is supporting the state-owned umbrella company FONAFE in designing and developing exchange mechanisms.

Last update: June 2021

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