The main function of Peter Walsh, if we look at the text, is the way that he represents a profound ambivalence towards life. He acts as a foil to the stable Richard, whom he finds extremely boring as a character. What is key about Peter Walsh is the way that he finds it impossible to decide on any one identity or to stick to one partner in life. Every aspect of his character features vacillation and ambivalence. For example, he feels at times he is not yet old, yet he fears that the best years of his life have already vanished and gone and he has wasted them. He tries to convince himself that he does not love Clarissa any more only to find that he experiences massive grief because he has lost her, and this suggests that he is still very much in love with her. If Richard is a rather basic character, very stable, Peter by contrast is something of a very unpredictable character who constantly surprises even himself with what he says, does and feels.
The significance of Peter therefore is in the way that he contrasts with others. His character does allow Clarissa to examine her youth, but what is much more significant about him is the way that he contrasts with others around him. Another way he acts as a foil is when Clarissa manages to accept her mortality, whereas Peter remains terrified of the thought of dying.