Until 2007, Uruguay was strapped for energy resources that forced it to rely on importing energy from South American neighbors. That has changed. Today, 98 percent of the country''s power is delivered reliably and affordably from renewable sources. Compare that to the worldwide average that is typically reported in the low- to mid-20 percent range and you can see that this small country might just be on to something. Does little Uruguay have a blueprint for renewable energy that others could follow?
In the decade leading up to 2017, forward-looking policies and projects took Uruguay from having virtually no wind power to nearly 4,000 megawatts of installed capacity. Photo by Jimmy Baikovicius.
Located between Argentina and Brazil, its two larger neighbors and trading partners, Uruguay is geographically the second-smallest nation in South America, with a population of about 3.45 million people, of whom roughly 1.8 million live in the metropolitan area of its capital, Montevideo. Since the signing of the Kyoto Protocol in 1997, Uruguay has surprised its South American neighbors with its growing list of environmental successes, including conserving native forests, protecting biodiverse areas, and showing remarkable progress on a promise to be carbon neutral by 2030.
Among conservation projects that have made international headlines are Uruguayan architect Rafael Viñoly''s ecologically driven bridge design at Puente Laguna Garzon that not only protects the lagoon''s wildlife, but transforms a typical vehicular crossing into "an event" by reducing the speed limit of the cars so that passengers are provided an opportunity to savor the natural beauty of the lagoon.
Other progressive energy projects include the country''s push toward a network of "electric highways". Piloted first along Uruguay''s coast, a highway designed for electric vehicles deployed charging stations every 60 km over its entire 300 km length. This highway project links Colonia and Punta Este, two popular tourist cities. Future projects look to embrace the whole country.
To transform its energy landscape, the Frente Amplio, or FA, Uruguay''s governing party from 2005 to 2020, recognized the reality of a country dependent on importing fossil fuels while living in an ideal location for solar, wind, and hydraulic power generation.
With its gently-rolling landscape, higher than average year-round sunshine, and hundreds of miles of ocean and river coastline, Uruguay has prime space for deploying energy alternatives. In addition, the country has identified significant opportunities for generating energy from biomass produced by the agriculture industry.
Among conservation projects that have made international headlines are Uruguayan architect Rafael Viñoly''s ecologically driven bridge design at Puente Laguna Garzon that not only protects the lagoon''s wildlife, but transforms a typical vehicular crossing into "an event." Photo by Jimmy Baikovicius.
In 2005, Uruguayan leaders laid out a plan for the country''s future built upon a broad consensus among a wide range of national and international stakeholders. It''s important to note that this comprehensive plan included not only outside investors, who could offer capital and expertise, but also dedicated in-country stakeholders. To date, the FA''s vision for an inclusive, people-oriented strategy for energy transformation has shown not only remarkable promise, but results.
"The energy policy of Uruguay has focused highly on renewable energies, with the ambitious goal of incorporating them in the short term and providing attractive tax benefits for that purpose," says Fernanda Panizza, Biz Latin Hub''s country coordinator and corporate lawyer, who counsels both foreign and national business stakeholders in the country. "Uruguay offers not only an advantageous business environment," she notes, "but also great social stability, and considerable fiscal incentives for investments."
Along with the benefits of sourcing renewable energy for new building projects, Panizza describes a foundation for all new architecture and construction that rewards energy conservation.
While Uruguay has made remarkable progress in expanding its renewable energy infrastructure, the country''s ground-breaking energy initiatives now face a new challenge: a new governing party with more conservative views and a new president, Luis Lacalle Pou.
At 46, Pou is the youngest president in the history of Uruguay and while his National Party is seen as politically right of center, his personal devotion to the conservation of the sea (he is an avid surfer) is generating some optimism among environmentalists that existing renewable energy policies will stay in place, along with the previous administration''s vision for an inclusive and people-oriented strategy for energy transformation.
National polls have indicated that, within Latin America, Uruguayans are among the most supportive of democracy and by far the most satisfied with the way democracy works in their country. How Uruguayans feel about being leaders in clean energy might just provide some of the momentum to keep the country''s strong commitment to renewable energy going.
World affairs analyst Frida Ghitis, who has covered political and social issues in the region for over a decade believes that there is good reason to look for the continuing positive trajectory of Uruguay''s progressive energy policies. "My sense is that Uruguay''s commitment to renewable energy is so deep that it transcends the left/right divide," she says. "I don''t foresee that the center-right administration in Uruguay will backtrack on progress toward green energy."
The history of Uruguay''s successful shift to renewables offers similar small countries (and, perhaps larger ones, too) a blueprint — if not just good ideas — for solid progress towards renewable energy. But, despite past successes, it''s not completely clear that Pou''s evolving policies, faced with water management issues in the country''s interior and ongoing coastal conservation initiatives, can maintain the country''s momentum scaling up renewable energy. The renewable energy communities around the world will be watching intently.
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Uruguay lies between Argentina and Brazil on the Atlantic Ocean and is home to about 3.5 million people. But this small country has made it to the top 5 in wind and solar energy producers worldwide. Rebecca Bertram reports
The International Energy Agency (IEA) announced in October that the country is in fourth place globally, producing 36 percent of its electricity from wind and solar energy. First place in the IEA ranking list goes to international renewables champion Denmark (50 percent), followed by Lithuania (41 percent) and Luxemburg (37 percent).
Including hydropower, Uruguay now produces more than 97 percent of its electricity from renewable energy sources. The country has undergone a remarkable change in its energy sector in recent years: only twenty years ago, oil accounted for almost 30 percent of Uruguay''s imports and large bulks of electricity were imported from neighboring Argentina.
The rapid diversification of its electricity sector began under former President Mujica who led the country between 2010 and 2015. For him, renewables, especially wind energy, were a way to cut electricity generation costs. Already by 2016, a year after his reign, wind farms across the country had lowered these costs by more than 200 million US dollars annually.
Mujica''s motivation was rational rather than ideological. His success can be attributed to transparent decision-making, a supportive regulatory environment and the strong partnership between the public and private sector. Stable wind conditions of about 8 miles per hour and low maintenance cost as well as a fixed twenty-years feed-in tariff guaranteed by the public utility provided a flourishing investment climate.
This policy has triggered more than 7 billion US dollars in investments in the country''s renewable energy sector so far and is responsible for more than 15 percent of its GDP. It also allowed Uruguay to reduce its greenhouse gas emissions by a staggering 88 percent by 2017 against the 2009-2013 average.
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