The results of the second auction called by Luz del Sur as the Leader of the Bidding Process for the supply of the electricity public service, reflect the present situation of the national electrical service, as the auction was declared void due to the absence of bidders.

The first tender was called on December 18, 2006 with discouraging results as it was declared partially void. Offers received only covered 67% of the total auctioned. This time, the auction was for 308 MW to complete the supply needs of Luz del Sur and Electro Sur Medio until February 2009 and December 2010, respectively.

There were 3 pre-qualified bidders: Duke Energy, Edegel and Termoselva. None of them were present. The only attendees were the representatives from Osinergmin, Indecopi and the electricity distribution company.

It is of public domain that since 2003 the generation companies do not wish to sign contracts with the distribution companies for the sale of energy at the bar price, thus a crisis in the sector arose in 2004, which was palliated by means of Law 28447 enacted in December 2004, thus allowing the operation of the system, although precariously.

Therefore, Luz del Sur only has its supply covered until December 2007.

Lima, March 16, 2006.