AES withdraws from Peruvian privatization process

15 May, 2002 – AES today became the second prominent US Power Company to decide not to participate in the Peruvian privatization process, following the withdrawal of Duke Energy last week.

AES said in a statement that it has informed the government of Peru that it did not intend to participate in the bids for electricity companies Egasa and Egesur. The auction is due to take place today.

The company said that it is selectively limiting its near term investment commitments. AES said it therefore intends to withdraw from the process.

Duke Energy decided not to enter the bidding after disagreements with the regulator Osinerg over procedures to set the rates. Osinerg defended its position last week. “We can’t negotiate to set the rates because we have to follow the law and technical analysis,” Osinerg head Alfredo Dammert said at a broadcast press conference.

Among other potential bidders for the companies are US companies PSEG Global Inc and NRG Group Inc as well as Tractebel SA from Belgium and Swedish power group Statkraft AS.

The Peruvian government hope to raise a minimum of $700m through privatizations this year.

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