Phoenix is making progress in Peru with a pipeline of approximately 2,800 MW of wind and solar projects , distributed across around 10 to 12 developments that are at different stages of maturity.
“The portfolio we have today fluctuates between 2800 and 3000 MW ,” revealed Juan Elías Salinas, General Manager of Fénix, during his participation in the streaming “See you at FES,” organized by Future Energy Summit in anticipation of FES Peru on September 28, where the executive will participate in the CEO panel.
Salinas indicated that the company seeks to move forward with a diversified portfolio, both in terms of technology and geographic location.
The strategy takes on particular importance at a time when Peru is seeking to finalize pending regulations that could prove crucial for enabling long-term contracts, new investments, and future supply tenders. According to the general manager of Fénix, the first definitions could be available in a relatively short time.
“ They tell us that in three or four months, a good part of the pending regulations, including the bidding processes for the regulated client, should be resolved ,” the executive anticipated.
Market expectations are focused particularly on the regulation of bidding processes for regulated customers and the development of a new market for ancillary services . Both instruments could become central to supporting greater penetration of renewable energy generation.
Salinas did not hide the urgency with which the sector awaits these changes. " This was needed yesterday ," the executive stated, after noting that energy authorities have been working on the remaining pending provisions.
Tenders: 2027 to start supplying in 2030?
One of the main questions now is when Peru will resume holding long-term electricity supply tenders .
According to Salinas, the last process aimed at regulated clients was carried out in 2016 , when this type of mechanism should be repeated more frequently, every two or three years.
The lack of new tenders had concrete effects on the incorporation of supply. During that period, distributors primarily moved forward through shorter-term bilateral contracts, a modality that, according to Fénix, made it difficult to financially support new generation projects .
“ It is difficult to leverage projects, to build projects, if one does not have long-term contracts ,” Salinas warns.
Therefore, the eventual reactivation of these tenders could become one of the biggest catalysts for the existing renewable pipeline in Peru, both for Fénix and for the rest of the companies seeking to develop capacity.
Regarding the timeline, the general manager offers a first concrete reference: a competitive process could be launched in 2027 to begin supplying energy from 2030 , considering the deadlines contemplated in the regulation under discussion.
For Fénix, however, the appeal of these calls will also depend on contractual stability and the definitive rules established by the new scheme .
The company maintains a significant focus on deregulated clients, especially industrial and mining consumers, where it believes it has a greater capacity to structure contracts and distribute risks between the parties.
If the conditions for regulated clients offer sufficient predictability, that market could also come under scrutiny. “ The important thing is to participate in those processes ,” Salinas summarized.
Ancillary services constitute the other relevant regulatory front. Fénix believes that the increase in solar and wind power generation will demand greater levels of flexibility and operational security , and therefore expects Peru to evolve from services that are primarily mandatory toward a market capable of generating economic signals for new investments.
Phoenix puts 2,800 MW of renewables into the race
Fénix's growth strategy is built upon this new regulatory landscape. The power generator has between 2,800 and 3,000 MW of renewable projects under development , although this figure should not be interpreted as capacity that will necessarily reach full operation.
But Fénix applies a selective logic. Salinas acknowledges that, in practice, only a fraction of the projects included in these types of portfolios end up being realized .
“ Our idea is not to build just any project, our idea is to accompany the processes of our clients ,” the general manager emphasized.
Thus, the company aims to have sufficient alternatives to select the asset that best suits each business opportunity. Consumer location, contracted volume, technology, and transmission infrastructure will be key variables.
Bayóvar and Algarrobal, the two projects that are gaining ground
Within that broad pipeline, two assets appear today in the most advanced group of Fénix: the Bayóvar Wind Farm, of 250.8 MW, in Piura, and the Algarrobal photovoltaic park, of 251 MW, in Moquegua .
Both projects together have a capacity of 501.8 MW and have approved environmental impact studies, as confirmed by Salinas.
“ These are the most advanced projects ,” the executive confirmed. That point is key: Fénix won't necessarily select the first project based on administrative order. The availability of contracts will be the deciding factor.
In the case of Bayóvar , located in Piura, the 250.8 MW wind project becomes more attractive if the company secures significant demand in northern Peru.
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“ If we can get clients in the northern area, Bayóvar is clearly a very attractive project to build ,” Salinas explains.
Fénix is observing the hiring processes of major mining companies in southern Peru , which could become a relevant commercial signal for Algarrobal as well as other portfolio assets located in that region.
“ The interesting thing today is that there are a couple of bidding processes for major mining companies in the south, and therefore this project could also be an interesting one ,” he argues.
Consequently, Bayóvar and Algarrobal have an advantage due to their higher level of development, but their implementation remains contingent on demand and the possibility of structuring contracts that support investments .
The strategy also replicates a lesson that Fénix takes from Colbún's experience in Chile: develop projects as close as possible to consumption centers to reduce exposure to limitations in the networks.
Salinas acknowledges that transmission systems typically advance at a different pace than generation, so the company wants to anticipate this with a geographically diversified portfolio.
The priority is to have enough options and, when a client appears, choose the best-positioned project within the pipeline instead of developing capacity without a defined contractual destination .
“ Any client who meets the conditions of being a free client is a client we always look at, no matter the size ,” Salinas explains.
However, he admits that large deals have a particular advantage: " Large clients allow you to leverage projects ."
Smaller, short-term contracts serve another function within the commercial portfolio: they allow for managing energy variations and exposure to the spot market in the face of hydrological changes or other system conditions.
This need for a new generation also occurs in a market where Phoenix observes an increasingly tight supply in the face of growing consumption .
“ In Peru today, supply and demand are almost perfectly matched ,” Salinas warns.
According to the executive, there is currently little efficient reserve available outside of dispatch , a condition that could keep the system exposed to periods with prices defined by technologies such as diesel, open cycles and combined cycles.
What represents a risk in the short term becomes, from Fénix's perspective, an opportunity to accelerate the construction of new renewable capacity.
According to Salinas, Peruvian electricity demand has registered a growth of close to 5% during the last year , compared to rates of around 3% observed previously.
If this dynamic continues, accompanied by new mining developments, electrification of production processes and eventually data centers, Peru could need to double its electricity matrix during the next 10 to 12 years .
In addition to the increased demand, there is the potential of available natural resources. Salinas compares Peruvian solar radiation to that of the Atacama Desert and highlights that certain wind farm areas in the country can reach capacity factors close to 50% , levels that are particularly competitive for the region.
Currently, according to the figures presented during the streaming, wind and solar renewables represent around 10% of the Peruvian energy mix , divided approximately equally between both technologies.
According to the general manager of Fénix, that percentage could increase considerably.
“ What we hope for Peru in the coming years is to advance, hopefully, to 35% or 40% of the electricity matrix ,” he projected.
However, this growth must be achieved through a technological combination that preserves the reliability of the system.
“ In Peru, we don't need to get into this war of choosing between renewable or thermal energy; instead, we need to start defining competitive and reliable renewable energy sources ,” he concluded.
Peru thus reaches a stage where growth in demand, thousands of renewable megawatts under development, pending regulations, and the expectation of recovering long-term tenders converge.
See you at FES Peru
The debate will continue onSeptember 28 in Lima , during a new edition of Future Energy Summit Peru , which will bring together the main representatives of companies, associations and institutions linked to the energy sector.
Confirmed participants include representatives from Fenix Power, Orygen, Kallpa Generación, Grupo Elecnor, Aurora Energy Research, Sungrow, JA Solar, CATL, Jinko Solar, FMO, AFRY, CAPO Energy and Solar Steel , as well as associations such as the Peruvian Renewable Energy Association, H2 Perú and Perú Renovable.
The event will bring together executives, developers, suppliers, and institutional leaders on an agenda focused on investment, regulation, storage, competitiveness, and the execution of new projects.