Peru proposes reviving power interconnection with Chile to tap its solar generation

The Peruvian government has proposed resuming talks with Chile on the interconnection of their electricity grids, a project that could facilitate the use of Chilean solar and wind power while taking advantage of the complementary nature of Peru’s natural gas and hydropower resources.

The announcement was made by Peru’s Minister of Energy and Mines, Guillermo Shinno, during the 21st meeting of the Chile-Peru Business Council, recently held in Lima. Shinno noted that electricity integration is part of Commitment 21 of the Santiago Action Plan and expressed his intention to meet with Chilean Energy Minister Ximena Rincón to advance discussions.

“The interconnection with Chile is on the agenda. It is a matter of seeing when we can meet with the Chilean energy minister to move this objective forward. If it does not happen before November, I imagine we will discuss it on Nov. 29 at the Peru-Chile binational meeting,” Shinno said.

One of the options under consideration is a 500 kV transmission line with a capacity of 1,000 MW connecting Montalvo, in southern Peru, with Kimal, in northern Chile.

According to a study commissioned by the Inter-American Development Bank (IDB) in 2025, the project would require an estimated investment of $550 million. The study found that bidirectional electricity exchanges could reach between 3,600 GWh and 5,700 GWh annually, generating combined economic benefits averaging $170 million per year.

The complementary nature of the two countries’ electricity generation mixes was a key consideration in the study. Chile has substantial solar and wind generation capacity, particularly in the north, while Peru has hydropower resources and natural gas-fired power plants that could supply electricity during periods of lower renewable energy generation in Chile.

For Chile, the interconnection would also provide an additional outlet for surplus solar generation, which currently faces transmission constraints limiting its delivery to major demand centers.

As previously reported, solar and wind power curtailment in Chile reached 2,680 GWh between January and July 2026. Exporting some of this electricity to Peru could help reduce curtailment, although the extent of such exchanges would depend on available transmission capacity and operating conditions in both countries.

Peru has also significantly increased its solar power generation. According to data from the Ministry of Energy and Mines, solar generation reached 1,442 GWh in the first half of 2026, up 87% year on year. Much of the country’s installed PV capacity is concentrated in the southern regions, particularly Arequipa and Moquegua.

Meanwhile, Chilean company EnorChile Transmission submitted an environmental impact statement for the Los Héroes-Parinacota transmission line project to Chile’s Environmental Assessment Service (SEA) on Oct. 13.

Unlike the Montalvo-Kimal proposal, the project involves an estimated investment of $30 million and the construction of approximately 22 km of transmission line on Chilean territory, connecting the Parinacota substation in Arica to the Peruvian border. From there, the line would extend to the Los Tacéro substation in Peru.

The proposed infrastructure would have a maximum transmission capacity of 250 MVA and include a converter substation to accommodate the different operating frequencies of the two national grids.

Despite renewed interest in cross-border electricity integration, the proposed 1,000 MW interconnection has yet to secure a final investment decision or construction schedule. Its development will depend on technical, regulatory and commercial agreements between the two countries.