Uruguay and hydroelectricity
Uruguay, officially known as the Oriental Republic of Uruguay, is notable for its reliance on hydroelectricity, particularly given its limited fossil fuel reserves. Situated on the River Plate in South America, the country has historically depended on renewable energy sources, with hydroelectric power gaining prominence since World War II. Despite its modest hydroelectric potential, largely due to the flat topography that restricts high waterfalls and significant water reservoirs, the construction of the Salto Grande and Palmar hydroelectric plants in the late 20th century significantly increased the share of hydroelectricity in the national energy mix. By 2021, hydroelectricity accounted for approximately 80 percent of the country's total generated electricity.
Uruguay's energy landscape has evolved, with the nationalization of the power sector in the early 20th century leading to the establishment of state-owned enterprises that dominate electricity generation and distribution. Though there were efforts to attract private investment in the late 20th century, only limited participation has been realized. The country has also diversified its renewable energy portfolio, generating substantial electricity from wind and solar sources alongside hydroelectric power. As of 2021, Uruguay's electrification rate was 100 percent, reflecting its commitment to sustainable energy practices and the integration of renewable resources into its energy infrastructure.
On this Page
Subject Terms
Uruguay and hydroelectricity
Official Name: Oriental Republic of Uruguay.
Summary: Uruguay has little in the way of its own oil, natural gas, or coal reserves. For power generation, it depends mainly on hydroelectricity.
Located on the River Plate in South America, Uruguay is endowed with minimal fossil fuel reserves, hydroelectric and wind potential, and an as yet unexploited potential in other renewable energy sources. During the period between the second half of the 19th century and World War I, its capital city, Montevideo, was an important coal depot port for ships navigating in the South Atlantic. Nevertheless, domestic consumption was covered mainly by firewood during the same period; in fact, even at present, it still plays a significant role in domestic primary energy supply.
Uruguay’s electrification rate was 100 percent as of 2022; taking its per capita income and its energy infrastructure into account, the Uruguayan per capita energy consumption is relatively low because of the lack of an energy-intensive industry, on the one hand, and relatively high energy prices compared to its neighboring countries, on the other. In 2021, fossil fuels (mainly oil products) accounted for about 39.3 percent of final energy consumption, electricity had a share of 20.1 percent, biomass (in the form of firewood, charcoal, biomass waste, and biofuels) another 39.4 percent, and natural gas 1 percent.
During the first two decades of the 20th century, a transition toward the consumption of fossil fuels began. At first, coal was the main imported fuel for covering domestic energy demand, but throughout the 1920s and 1930s, oil slowly took its place. In the mid-1950s, petroleum already covered two-thirds of domestic energy consumption, and it continued to grow in importance during the next twenty years.
Electricity began to be introduced in the 1880s in the major cities through private concessions. At the beginning of the 20th century, the power utility of Montevideo was having financial problems, so the government decided to nationalize it, and this action opened the door for the nationalization of the power service in 1912. That year, the state-owned Usinas Eléctricas del Estado (UEE, after 1931 Usinas y Teléfonos del Estado, UTE, and after 1974 Usinas y Transmisiones Eléctricas, UTE) was created by law. Only power utilities with valid concessions and streetcar power providers remained in private hands. However, in 1947, the nationalization of the power sector was completed; UTE monopolized the generation, transmission, and distribution of electricity until 1977.
Uruguay has modest hydroelectric potential, and its exploitation is conditioned by the absence of high waterfalls due to the country’s relatively flat topography. For the same reason, it is difficult to build hydroelectric plants with important water reservoirs that allow energy storage to be used during the dry season. Thus, hydroelectric power generation is highly dependent on the quantity of rainfall in a specific year. Hydroelectricity began to play an increasing role only after the end of World War II. In 1979 and 1982, respectively, the Argentinean-Uruguayan Salto Grande and the Palmar hydroelectric power plants came on line; combined, they increased the share of hydroelectric power from 29 percent to 80 percent of total generated electricity.
In 1977, the government allowed private investments in the power sector. Still, as conditions for investment were unclear, there was no private participation in the power sector for the next two decades. In 1997, the government introduced new framework conditions in the power sector: economic and investment activities have been separated from regulation, policymaking, and oversight; new government institutions were created for regulation and supervision over the power sector; and free access to independent power suppliers is guaranteed. However, only a few independent power producers have entered the market.
Uruguay operates, jointly with Argentina, the hydroelectric power plant at Salto Grande. Moreover, the Uruguayan power network is interconnected with that of Argentina through two 500-kilovolt lines with a capacity of 2,000 megawatts. There are also two natural gas pipelines between the two countries: the 3.9-million-cubic-foot-per-day Litoral Pipeline, in operation since 1998, which supplies Paysandú, and the 16-million-cubic-foot-per-day Cruz del Sur Pipeline, in operation since 2003, which supplies Montevideo. Additionally, there is a 150-kilovolt transmission line with a capacity of 72 megawatts in Brazil, and a new 500-kilovolt line with 500 megawatts of capacity is being studied.
Uruguay has introduced renewable energies such as hydroelectric and wind energy into its energy matrix. In 2021, Uruguay generated 5,273 gigawatt-hours of electricity from hydroelectric power and 4,991 gigawatt-hours of electricity from wind power. An additional 483 gigawatt-hours were generated through solar power.
Bibliography
Bertoni Mendaro, Reto. Energía y desarrollo: La restricción energética en Uruguay como problema (1882–2000). Doctoral dissertation, Universidad de la República, Montevideo, Uruguay, 2010.
Gasoducto Cruz del Sur. “Our Company.” http://www.gasoductocruzdelsur.com.uy/index‗html‗eng.htm.
“Uruguay.” CIA World Factbook, 7 Aug. 2024, www.cia.gov/the-world-factbook/countries/uruguay. Accessed 12 Aug. 2024.
“Uruguay.” International Energy Agency, 2024, www.iea.org/countries/uruguay. Accessed 12 Aug. 2024.