The Peruvian electricity system is headed for a structural transformation over the next ten years. Aurora Energy Research projects that the combined share of solar photovoltaic and onshore wind power will increase from 14% of installed capacity in 2026 (2.1 GW) to 32% in 2035, the largest increase among the Latin American markets analyzed by the firm.
This leap will be accompanied by a 28% expansion in electricity demand between 2026 and 2035 , from approximately 64 TWh to 72 TWh in 2030 and 82 TWh in 2035 , driven primarily by the mining, industrial, commercial and residential segments.
“The Peruvian market is one of the largest, and perhaps the largest, in Latin America. This makes it a very attractive market for developing new renewable energy investments because this growth in demand must be accompanied by growth in supply,” said Matheus Dias , Senior Associate for Peru, Brazil, and Colombia at Aurora Energy Research.
“ This is what we saw in Brazil and Chile over the last 10-20 years, and now it will be the renewable energy boom in Peru. This is our vision ,” he stated during the Future Energy Summit (FES) Peru.
Relive FES Perú in full: https://www.youtube.com/watch?v=0sL4_p8bfK4&t=14633s
The company forecasts that total installed capacity will increase from around 15 GW in 2026 to 22 GW in 2035. At the same time, hydroelectric power will lose relative importance: it will fall from representing 37% of the current capacity to 26% by the end of the analyzed period .
The change in composition does not imply that hydroelectric generation ceases to be relevant, since this year it accounts for 37% of installed capacity and nearly 50% of electricity production , but the entry of new capacity would come mainly from non-conventional sources.
“We have two interesting components. First, the new flexible capacity, which is from batteries or peak thermal power plants, which we believe will reach 3 GW by 2035, but growth is expected from non-conventional renewables (solar and wind), going from 14% today in Peru to 32%, so more than doubling in 10 years,” Dias explained.
Regional comparison is one of the central points of the perspective presented by the consultancy, since Peru starts from a variable renewable penetration considerably lower than that of other Latin American systems .
But its rate of incorporation during the next few years would be higher, given that in comparison, Colombia would evolve from 19% to 35%, while Chile would go from 44% to 46% and Brazil from 40% to 47%.
The anticipated acceleration is also supported by expected demand trends. In fact, the projected 28% expansion for the period exceeds the expected growth in Colombia, Chile, and Brazil, according to the consulting firm's comparison. Colombia is expected to register 27%, Brazil 23%, and Chile 22%.
One reason is the available scope for further electrification of the economy. In 2025, Peruvian per capita consumption will reach approximately 1,780 kWh , compared to 3,340 kWh in Brazil and 4,210 kWh in Chile .
“Per capita demand in Peru is half that of Brazil and 2.5 times lower than in Chile. Therefore, the electrification of the residential, industrial, service, and mining sectors will certainly increase this per capita consumption,” Dias emphasized.
The market already boasts a project pipeline significantly larger than the currently operational volume. According to industry information , there are over 22 GW of solar and wind projects in various stages of development .
The photovoltaic portfolio reaches 13,778 MW , although only 2,726 MW have a Definitive Generation Concession . Meanwhile, in wind power, there are another 8,243 MW under development , of which only 988 MW have reached that stage of administrative progress.
The gap between announced or pending projects and those with final approval will be crucial in determining how much of that pipeline will actually become new capacity. The identified volume is several times the currently installed solar and wind power , but much of it still needs to go through various stages before becoming operational.
Energy storage is beginning to gain ground in this transition. According to external information gathered by the journalist, battery storage potential could reach approximately 700 MW by 2030 , while Aurora identifies a broader need for flexibility—including BESS and peak thermal storage—that would reach approximately 3 GW by 2035.
Hourly prices: the other side of renewable expansion
The increased income from variable generation will modify the price structure of the Peruvian market, even if the average annual values remain relatively stable.
Under Aurora's P50 scenario, prices would remain "around USD 35-40/MWh" , but the differences between time blocks (daytime, nighttime and evening) would increase significantly, so that by 2035, nighttime prices would be approximately 25% higher than those recorded during daytime hours .
This differential will be relevant for the financial structuring of new assets. Increased solar generation will put particular pressure on midday hours , while technologies capable of shifting energy to higher-value time slots will be able to capture widening spreads.
Therefore, the next phase of the market will not be determined solely by the number of megawatts added. The combination of demand growth, hourly price profiles, storage, flexibility, and commercial capture will become increasingly relevant to project profitability.
“ To develop new renewable investments, it is crucial to understand this dynamic in Peru ,” Dias concluded.
Aurora anticipates a 30% solar and wind boom in Peru by 2035: “It’s what we’ve seen in Brazil or Chile for more than a decade.”
Will Brazil or Chile become the next Brazil or Chile in Latin American renewables? Aurora projects a leap to 32% solar and wind power in Peru.
Matheus Dias – Senior Associate Peru, Brazil and Colombia – Aurora Energy Research
Aurora Energy Research projects electricity demand and consumption in Peru from 2026 to 2035. Historically, consumption in Peru has been heavily influenced by mining, industrial, and residential use. We believe this growth will reach 28% by 2035, primarily due to the mining, industrial, commercial, and residential sectors.
When we compare Peru's growth with other Latin American markets, we see that this 28% growth is the largest in Latin America that we are studying at Aurora. So today, demand in Peru is the smallest compared to Colombia, Chile, and Brazil.
And what's even more interesting is that per capita demand in Peru is half that of Brazil and 2.5 times lower than in Chile. Therefore, the electrification of the residential, industrial, service, and mining sectors will certainly increase this per capita consumption, which is currently very low in Peru.
The Peruvian market is one of the largest, and perhaps the largest, in Latin America. This makes it a very attractive market for new renewable energy investments because this growth in demand must be accompanied by a growth in supply.
Projections of installed and projected capacity by technology between 2026 and 2035.
This year, 2026, hydroelectric plants account for 37% of installed capacity and nearly 50% of generation. But when we look further ahead, we see that this share will decrease to 26%.
If hydroelectric power declines, what will increase? We have two interesting components. First, the new flexible capacity, which is from batteries or peak thermal power, which we believe will reach 3 GW by 2035, but growth is expected in non-conventional renewables (solar and wind), going from 14% today in Peru to 32%, so more than doubling in 10 years.
When we compare that with other Latin American markets, we see that today Peru's installed capacity is one of the smallest in terms of solar and wind power, but when we look to 2035, it is the largest growth also in terms of installed capacity.
It's like what we saw in Brazil about 10 years ago or in Chile 20 years ago, which is now going to be the renewable energy boom in Peru. This is our vision.
While on the price side, historically prices have changed a lot with the
Hydrology, just like in Brazil, when it rains a lot prices go down and when it rains little prices go up.
At Aurora, we aim to project energy prices, and for that, we always have a P50 world view. So, what will it be like in the P50? What will demand be like in the P50?
Average prices are projected to be between USD 35-40 per MWh annually. However, the hourly volatility that is currently almost nonexistent in Peru will increase significantly. This will result in three price periods: morning, afternoon, and evening.
Today there is almost no price volatility, but when we look at the end of the decade or 2035 the difference between afternoon and evening prices will increase by 25%.
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The renewable energy mix is going to increase significantly, and average prices will likely remain around USD 35-40/MWh, but hourly prices will experience considerable volatility. Therefore, understanding this dynamic in Peru is crucial for developing new renewable energy investments.