Peripheral ERA is a pitching statistic created by the Baseball Prospectus team. It is the ERA you would expect a pitcher to have given his park-adjusted hits, walks, strikeouts, and home runs allowed. Unlike Voros McCracken's DIPS, hits allowed are included. PERA doesn't attempt to eliminate the effect of luck on batted balls away from ERA, instead attempting to account for good (or bad) luck in the combinations of hits, walks, home runs, and strikeouts. A lower PERA than EqERA (adjusted ERA) may indicate poor luck which may even itself out in the future, leading to a lower EqERA despite no change in quality of pitching.

From Baseball Prospectus 2004.