Peru’s power system recorded an extraordinary surge in active energy transfer payments in March 2026, surpassing PEN 510 million (over USD 150 million), four times the average of the past three years (PEN 101 million / USD 32+ million).
The figure, published in the preliminary report by the Comité de Operación Económica del Sistema Interconectado Nacional (COES), reflects the direct impact of a natural gas supply disruption on electricity market operations.
This rise in payments between generators coincided with a sharp increase in generation costs, pushing spot prices above USD 250/MWh, well beyond typical system levels.
Reduced gas availability forced the replacement of efficient generation with more expensive technologies, directly affecting market settlements.
These payments are made among participants in the wholesale electricity market based on the valuation of energy injections and withdrawals. Under this framework, any deviation from the optimal economic dispatch—as occurred in March—widens differences between market agents and increases compensation amounts.
Brendan Oviedo Doyle, partner at DLA Piper, noted that “total transfers exceed PEN 510 million”, directly linking the operational disruption to the system’s financial outcome.
The COES report indicates that the system operated under stressed conditions, with transmission congestion and constraints in critical equipment such as transformers at the Independencia and San Nicolás substations. These limitations generated congestion rents and required dispatch adjustments, increasing short-term marginal costs.
Additionally, available natural gas had to be redistributed among thermal generators through exceptional mechanisms, based on contracts and efficiency criteria. This altered recognised injections for each agent, directly impacting transfer valuations and final payments.
The economic impact is spread across key market players, including Kallpa Generación, Engie Energía Perú, Fenix Power, Electroperú, Celepsa and Enel Generación Piura. These companies operate within a framework combining generation, supply contracts and inter-participant backup arrangements, which amplify financial settlements during constrained conditions.
The report also highlights cross-contracting and backup schemes among generators, where multiple companies serve the same demand, further increasing payment volumes when the system deviates from normal operation.
Inconsistencies in data reported by some participants were also identified, forcing COES to apply provisional technical criteria to allocate consumption and withdrawals. Discrepancies were found between generators such as Electroperú and Eghuallaga, along with undeclared consumption incorporated into transfer calculations.
These adjustments reflect a high level of operational uncertainty and contribute to payment volatility within the market.
At the same time, the crisis has once again underscored the need to diversify Peru’s power mix and strengthen system resilience. The episode has revived the debate on accelerating renewable energy deployment and energy storage systems (BESS), particularly in a grid heavily reliant on natural gas.
Indeed, the report already shows the participation of battery energy storage systems (BESS) in Chilca and Kallpa, integrated into operations through schemes linked to hydroelectric plants. These assets introduce new market dynamics by registering both injections and consumption in transfer valuations.
“The natural gas supply disruption once again exposes a neglected power system. There are even regulations pending from Law No. 32249 for over a year,” said Oviedo Doyle.
“There is a complete lack of consideration for regulatory changes regarding capacity remuneration and energy arbitrage for BESS. Regulatory inaction is shifting systemic risk directly onto companies, creating additional costs and undermining investment predictability. This is not sustainable,” he added.
Finally, the diagnosis points to weaknesses in energy sector governance. According to the expert, regulatory delays stem more from issues of prioritisation, leadership and execution than from technical complexity.
“Our energy policy has not been updated for more than 15 years, and there is a total lack of an implementable energy plan,” he concluded.
