Mining is beginning to position itself as the main driver of demand for battery energy storage systems (BESS) in Peru , in a market where price arbitrage still does not generate enough revenue to develop large-scale projects.
In this scenario, the sector awaits a key definition from the Economic Operation Committee of the National Interconnected System (COES) regarding capacity remuneration, a mechanism that could improve the bankability of these initiatives and accelerate new investments.
In a dialogue with Energía Estratégica , Álvaro Pérez Ramírez , Manager of AFRY , explains that the main inquiries the company receives today come from projects linked to mining , where companies seek to complement renewable supply contracts with BESS systems to guarantee a continuous supply.
"Many requests come to us from generators who, in turn, receive requests from consumers, mainly mining companies," he stated.
"There are many mining companies that have signed PPA contracts with solar projects that occasionally see some restriction in the supply of transport or network management and say: 'I need a battery on a much smaller scale than the solar project, but I need a battery that guarantees 24/7 operation'," said the AFRY Manager.
Furthermore, the business model is also beginning to change . According to Pérez Ramírez, mining companies are no longer seeking to acquire these assets directly, but rather to contract schemes where the investment is recovered through the savings generated by storage.
"Consumers or mining companies are no longer willing to pay for the asset as before, but now want a shared savings system," he said.
Under that arrangement, he added, "what I want is to pay you for the battery based on what the battery is saving me in costs by not consuming during peak hours or by not paying for the restriction."
However, the development of energy storage in Peru still faces a structural challenge. Unlike markets such as Chile or Spain, where the marked differences between daytime and nighttime electricity prices favor energy arbitrage, the configuration of the Peruvian electricity system significantly reduces this business opportunity .
"It's a system with high hydro penetration and high thermal penetration, which makes it very flexible," explains Pérez Ramírez. This characteristic, combined with the regulated price of natural gas, means that "the entry of batteries through price arbitrage will be very limited," he warned.
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According to AFRY's analysis, the price differentials currently observed in the market —between USD 15-17 per MWh during solar hours and between USD 25-35 per MWh at night— are still not enough to sustain the business solely through arbitrage.
"Those spreads aren't enough for the batteries," summarized the AFRY Manager.
Capacity payments, the signal the market is waiting for
While demand is beginning to grow, driven by the mining sector, the development of larger-scale BESS projects will still depend on regulatory clarity. In this regard, the sector is focused on the implementation of the regulatory procedure known as PR-21 , through which COES will define the capacity remuneration scheme for batteries. For AFRY, this decision will be crucial because it will determine how much compensation these assets will receive for their firm power contribution to the system.
The executive clarifies that Peru has already taken some regulatory steps to facilitate the incorporation of BESS systems into the electrical grid. "There is already a regulatory framework for the introduction of batteries as generation assets," he maintains.
However, he explains that the recognition of firm capacity will be crucial for projects to reach a larger scale. He also highlights that the Peruvian market has a differentiating characteristic compared to other countries in the region: it operates under a nodal model, which opens up specific opportunities for storage.
"Peru is indeed a nodal market," Pérez Ramírez points out. In that regard, he adds that "specifically in solar nodes, especially in the south, in San José and other areas, opportunities for battery storage can be seen" through local arbitrage and future capacity payments.
According to AFRY's analysis, the combination of this mechanism and the opportunities offered by certain nodes could enable projects on a larger scale than those currently available. "That's something we see as setting Peru apart from Colombia," the executive stated. He even projects that "it will enable larger-scale battery projects in Peru, perhaps in the tens of megawatts, within the next five years or so."
However, not all revenue streams are evolving at the same pace. Pérez Ramírez explained that complementary services are still generating less interest because, so far, they will not be allocated through competitive market mechanisms.
"They will be paid based on the cost of the service, not through a market mechanism," he explained.
This, he adds, reduces revenue visibility for structuring project financing. "Yes, they will have that revenue, but they won't be able to visualize it in a contract, which is ultimately what makes the battery bankable," he concluded.