Chapter 6 - The challenges and contradictions of Peru’s Proyecto Masivo de Energía Solar

Abstract

This chapter analyzes the first off-grid solar energy auction carried out by the Peruvian government and the subsequent public–private partnership (PPP) formed with the winner of the auction. The aim is to show how unseen, disjointed contract elements may disrupt the visions and estimations made by PPP design committees, which may ultimately lead to this project’s failure to meet the expectations and needs of the historically neglected communities it is designed to serve. This chapter demonstrates how the state’s poor understanding of the ground-level complexities of off-grid solar energy provision is reflected in the proyecto masivo design. It argues that the limited technical and financial role allocated for the private firm, Ergon, has not properly accounted for the logistical and social challenges of providing solar energy service in remote communities of the country. This chapter also argues that the proyecto masivo contract strains the country’s energy public distribution companies with burdensome activities that these companies are unwilling to carry out and will ultimately cause them financial harm. Analysis of the proyecto masivo contract reveals how both the private and public companies are obligated to collaborate with one another, yet the duties allocated to each sector as well as the state-mandated remuneration levels tied to their responsibilities, ensure that each sector will operate with indifference toward the other. Analysis of the policies and procedures underlying infrastructure programs such as Peru’s proyecto masivo are crucial, as it bears a double burden in the global energy transition. It represents both a “planet-preserving” effort to fight climate change, while also striving to offer social and economic inclusion benefits to the country’s marginalized rural populations.