Uruguay has managed to ensure that wars and the oil crisis do not affect them. The transition to renewables has been its shield

In the last 20 years, Uruguay has made a radical change to its energy industry. He was one of the pioneers in making “green” energy move the country, representing 94% of its energy matrix. They have not rested on their laurels and this has gone further: Uruguay has been running solely on renewable energy for almost a year.

It is the fruit of a long, but almost mandatory, energy transition that allows what happens on the other side of the world to affect them very little.

The renewable club. Norway, New Zealand, Iceland, Costa Rica, Kenya, Bhutan and Paraguay are the countries that lead the renewable energy club. They are those that operate with 100% renewable energy or are close to this figure. It is true that they are not the most populated in the world, so their energy needs are not the highest, but it is undoubtedly a good example of what can be achieved with investment in these energy sources.

There are other countries seeking to join this club (Spain or Portugal, without going any further), but also Chile and Uruguay. Precisely, the latter have managed to operate from July 2023 to April 2024 using only energy from renewables.

A transition. The South American country is not rich in fossil fuels, but in 1945 the Rincón del Bonete Dam. Later two more arrived (Baygorria Corner and Big Jumpthe latter shared with Argentina) that began to generate energy, showing that perhaps it was not necessary to buy crude oil from other countries. At the end of the 2000s, a renewable program was promoted to complement the production of hydroelectric plants.

Apart from biomass and Punta del Tigre central which is used to cover peaks in energy demand, the country has achieved a complete transition to renewables.

Breakdown. As we can see in the Ember report, hydroelectric plants continue to have a great weight in the country, representing 42.9% of the energy matrix. 40.6% comes from wind farms (the country’s other major energy source), 12.9% from biomass and 3.5% from solar energy. In 2020, the scenario was very different and fossil fuels were more present. In a particularly dry year, hydraulics contributed 29%, wind 33% and solar just 3%. The rest? 23% biomass, 10% diesel and 2% fuel oil.

Aside from Ember’s, other reports They position Uruguay as one of the countries at the forefront not only of change in Latin America, but in the world. The keys? According to the country, are “to take advantage of the country’s natural conditions, political will, modern regulations and the implementation of a public-private model for investment in the sector.”

Impact. Thus, Uruguay has invested more than 3% of GDP in energy infrastructure in the years in which the process of changing the energy matrix was being carried out. Ramón Méndez Galain, is a particle physicist who occupied the position of Director of Energy of the country until 2015, the key years of this transition. Recently, commented in a podcast that this has created more than 50,000 jobs and turned Uruguay into an electricity exporter.

Unplugged from crises. And as important as this is something that also mentioned Mendez. Thanks to this energy change and no longer depending on what you buy from other countries, the price of energy can be lowered and you protect yourself from market volatility. “You become independent of all these types of wars or other geopolitical events. Ask me what the impact was on the electricity sector in Uruguay after this tragic war in Europe: zero. We have no impact because we are not dependent on energy commodities.”

green hydrogen. Also interesting is that the country is not going to sit idly by and, as announced A few months ago, the intention was to start obtaining energy from green hydrogen. With an investment of 6 billion dollars and led by the Chilean company HIF Global, a green hydrogen plant will be built in Paysandú that will be ready sometime between 2025 and 2026.

This is the first major investment in this type of energy and it will be interesting to check, when the project begins, the percentage of energy it contributes to the network.

Image | Eric Wilde

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