Large consumers: 0.047, medium consumers: 0.131 (LAC average in 2005: 0.107)
Services
Sector unbundling
No
Share of private sector in generation
6%
Share of private sector in transmission
0%
Share of private sector in distribution
0%
Competitive supply to large users
No
Competitive supply to residential users
No
Institutions
No. of service providers
1 (UTE)
Responsibility for transmission
UTE
Responsibility for regulation
Unidad Reguladora de Servicios de Energia y Agua (URSEA)
Responsibility for policy-setting
National Directorate of Energy and Nuclear Technology (DNTEN)
Responsibility for the environment
National Directorate of Environment (DINAMA)
Electricity sector law
Yes (1997)
Renewable energy law
No
CDM transactions related to the electricity sector
3 registered CDM projects; 251,213 t CO2e annual emissions reductions
The electricity sector of Uruguay has traditionally been based on domestic hydropower along with thermal power plants, and reliant on imports from Argentina and Brazil at times of peak demand. Over the last 10 years, investments in renewable energy sources such as wind power and solar power allowed the country to cover in early 2016 94.5% of its electricity needs with renewable energy sources.[5]
Hydropower provides a large percentage of installed production capacity in Uruguay, almost all of it produced by four hydroelectric facilities, three on the Rio Negro and one, the Salto Grande dam shared with Argentina, on the Uruguay River. The production from these hydropower sources is dependent on seasonal rainfall patterns, but under normal hydrological conditions, can supply off-peak domestic demand.
Thermal power from petroleum fired power plants, activated during peak demand, used to provide the remaining installed production capacity. Generation from fossil fuel decreased substantially in recent years, with renewables accounting for 94.5% of electricity generation in 2015.[6] Thermal power from biomass also provides additional power generation capacity.
The shift to renewable energy sources in recent years has been achieved thanks to modernization efforts, based on legal and regulatory reforms in 1997, 2002, and 2006, which have led to large new investments in electrical production capacity including from the private sector. Purchasing agreement offered by the government in the final reform in 2006 incentivized a rapid growth of sustainable energy capacity in the country.[7]Wind power capacity has gone from negligible in 2012 to 10% of installed capacity by 2014. A new, highly efficient combined cycle power plant which can run on either gas or oil has been installed[8].[citation needed] A number of photovoltaic solar power plants have been built. Additionally, a new electrical grid interconnection has improved the ability to import or export electricity with Brazil.[citation needed]
Electricity supply and demand
Installed capacity
Installed electricity capacity in Uruguay was around 2,500 MW (megawatts) in 2009 and around 2,900 MW in 2013. Of the installed capacity, about 63% is hydro, accounting for 1,538 MW which includes half of the capacity of the Argentina-Uruguay bi-national Salto Grande. The rest of the production capacity is mostly thermal and a small share of wind and biomass.[9]
The power system exhibits characteristics and issues of hydro-based generation. The apparently wide reserve margin conceals the vulnerability to hydrology. In dry years it is necessary to import over 25% of the demand from Argentinian and Brazilian markets.[10]
About 56% of generation capacity is owned and operated by UTE, the national utility. The remaining capacity corresponds to the Salto Grande hydroelectric plant (945 MW), to co-generation or to small private investments in renewable sources. The table below shows the plants that are operated and owned by UTE as of 2008:[11]
Installed capacity had barely changed between 1995 and 2008. The most recent addition was the 300 MW Punta del Tigre Plant, whose last units started operations in 2008. A 530 MW dual fuel (gas/light oil) CCGT power plant, "Punta del Tigre B", is being built in the Punta del Tigre site; construction started in late 2013 and final completion is expected by late 2018. The existing large hydroelectric potential has already been developed and the existing thermal units are low performing.[10] Total generation in the year 2008 was 8,019 GWh, 56.1% of which were from hydroelectric sources, with 42.2% being thermal.[9]
Imports and exports
In the years leading up to 2009, the Uruguayan electricity system has faced difficulties to supply the increasing demand from its domestic market. In years of low rainfall, there is a high dependency on imports from Brazil and Argentina. Exports have historically been negligible. In particular, no electricity has been exported in 2009.The table below shows the evolution of imported electricity since 1999:[9]
Electricity imports
Year
Average power (MW)
Argentina
Brazil
Total
1999
707,640
61
707,701
2000
1,328,015
62
1,328,077
2001
116,815
5,877
122,692
2002
558,958
153
559,111
2003
433,913
315
434,228
2004
1,934,774
413,143
2,347,917
2005
834,863
750,346
1,585,209
2006
2,023,753
808,638
2,832,392
2007
573,629
214,960
788,589
2008
832,648
128,794
961,442
2009 (1)
737,613
433,249
1,170,861
(1) January–June 2009 These energy exchanges happen through two existing interconnections, a 500kv line with Argentina, through Salto Grande, and a 70kv line with Brazil, through Garabi.[13]
Demand
Total electricity consumption in 2008 was 7,114 GWh, which corresponds to a per capita consumption of 2,729 kWh.[11] Share of consumption by sector was as follows:[13]
Residential: 41%
Industrial: 24%
Commercial: 20%
Public lighting and others: 15%
Demand and supply projections
In the period 2002–2007, after the 2002-2003 economic and financial crisis, electricity demand increased 4.9% per year on average. Electricity demand increased by 7.5% between 2006 and 2007, from 6,613 GWh to 7,112 GWh, reaching a per capita value of 2,143 kWh. Yearly demand increase is expected to be about 3.5% during the next ten years.[9]
Reserve margin
Maximum demand on the order of 1,500 MW (historic peak demand, 1,668 MW happened in July 2009[14]) is met with a generation system of about 2,200 MW capacity. This apparently wide installed reserve margin conceals a high vulnerability to hydrology.[10]
Service quality
Access to electricity in Uruguay is very high, above 98.7%. This coverage is above average for countries with public electricity services.[13] Quality of service is perceived to be good both by companies and residential users. Companies suffer losses of just about 1.1% of their sales due to electricity service interruptions [15]
Interruption frequency and duration are considerably below the averages for the LAC region. In 2004, the average number of interruptions per subscriber was 7.23, while duration of interruptions per subscriber was 9.8 hours. The weighted averages for LAC were 13 interruptions and 14 hours respectively.[16]
UTE has implemented a series of measures to reduce electricity losses, which were particularly high during the 2002-2003 crisis.[16] In December 2007, losses were still high, about 18%, of which 7% to 8% were of technical nature.[17]
Responsibilities in the electricity sector
The National Directorate of Energy and Nuclear Technology (DNTEN) formulates energy-sector policies. The regulatory functions are assigned to URSEA, the regulatory body. Both transmission and distribution activities are fully under the control of UTE, as established by the 1997 law.
Private companies
Currently, there are four private companies that generate electricity for their own consumption and sell their surplus to the grid: Botnia (biomass, 161 MW), Agroland (wind, 0.3 MW), Nuevo Manantial (wind, 10 MW) and Zenda (natural gas, 3.2 MW). The Azucarlito plant (5 MW) operates in the spot market.[18] The current 6% private contribution to the generation park is expected to increase as investments in new wind power plants materialize.
Activity
Private participation (%)
Generation
6% of installed capacity
Transmission
0%
Distribution
0%
Renewable energy resources
Renewables could play a role in future energy supply, in particular wind power, allowing Uruguay to reduce its dependence on imports.
The Salto Grande Dam
All the potential for large hydroelectric projects in Uruguay has already been developed. Existing plants are Terra (152 MW), Baygorria (108 MW), Constitucion (333 MW) and the bi-national Salto Grande, with a total capacity of 1,890 MW.
Sierra de los Caracoles wind farm
Uruguay has a favorable climate for generating electricity through wind power. Installed wind power capacity reached 1,000 MW by 2016,[19] generating 17% of the country's electricity.[20]
The National Environmental Directorate (DINAMA) received several requests for new wind projects by 2009 and UTE had a very positive response to the bidding process launched that year.[21] In August 2009, the government of Uruguay approved a Decree that allows UTE to bid 150 MW of wind power. USD 300 million of private investment was expected as a result.[22] The first wind farm in Uruguay, the 10 MW Nuevo Manantial project in Rocha, started operations in October 2008. A few months later, in January 2009, UTE's 10 MW wind farm in Sierra de los Caracoles also started operations.[21] By 2016 Uruguay had enough wind power to export to Argentina and Brazil at times of high generation.[23][20]
Biomass based on renewable sources such as rice husk could generate up to 20 MW at competitive prices. Firewood has already been used as a substitute for fuel oil in the 1980s, and cellulose projects expect to generate up to 65 MW for sales to the network.[10]
History
Early installations
150 kV power line from Rincón del Bonete to Montevideo
The first large hydroelectric power station was completed in 1945 in Rincón del Bonete. Before, power supply in Montevideo was done by a thermal power plant José Batlle y Ordóñez located at the Montevideo port.[24]
Power sector reform
In 1997, the national electricity law was updated following the principles of the so-called “standard model,” which contemplated the separation of regulatory/governance functions from corporate functions, and put in place the regulatory agency URSEA and a market administrator, ADME. The reform contemplated the remuneration of generators in order of merit, the creation of a wholesale market with regulated prices in transmission and distribution, where competition is not possible.[10]
The reform has not been effectively implemented. After passing the modifications to the electricity law, secondary legislation was not forthcoming and the system continued to operate without any significant change. The new model was regulated in 2002 and it was expected that new operators would enter into a competitive market. The market did not develop as planned and demand actually decreased due to the economic crisis in the region. For instance, natural gas provision, which could have supplied new power generating units, did not materialize. Although URSEA and ADME were established, they cannot yet fulfil most of the functions established in their mandate.[10]
Dependence on imports
For a full decade no power capacity was added to the power system. Prior to the completion of the 100 MW Punta del Tigre diesel power plant in August 2005, UTE had not added a power station to the system since 1995, when the last unit of Salto Grande came online. The absence of commissioning of new production facilities during this extended period was the product of a conscious, strategic decision to take advantage of market developments in Argentina and in the region, which would allow imports to fill any Uruguayan shortfalls, while exporting hydropower surplus production to Argentina and Brazil during wet years.[10]
Dependence on imports from Argentina started to become problematic in 2004. Before 2004, UTE was able to supply its demand through a combination of contracts and purchases on the Argentinean spot market. As a result of the Argentine energy difficulties, UTE's contracts with Argentina for firm supply of 365 MW were reduced to 150 MW and were not extended beyond 2007. Notwithstanding this forced reduction in supply from Argentina over the low hydrology period of 2004–06, UTE was able to maintain energy imports through a noticeable increase of imports from Brazil and purchase of energy from the Argentine spot market.[10] In 2008, supply costs increased substantially as the drought, high fuel costs and low availability of power in neighboring countries.
Policy options
The Energy Strategy Guidelines for Uruguay were defined in 2006 by the Ministry of Industry, Energy and Mines (MIEM). This strategy includes: (i) diversifying energy sources to reduce costs and emissions, as well as increase energy security; (ii) increasing private participation in new renewable power generation; (iii) increasing regional energy trade; and (iv) facilitating availability and acquisition of energy efficient goods and services, including efforts to raise public awareness regarding demand-side management interventions. According to the National Directorate for Energy and Nuclear Technology (DNETN), grid-connected wind power generation is one of the domestic resources with both medium and long term potential in Uruguay.[10]
The government has taken action to promote RE development. In March 2006, the executive power issued Decree No.77/2006 to foster private generation through wind, biomass and small hydropower plants. A target of 60 MW was established for the first tender, which was conducted by UTE in August 2006. Although bids received for wind and biomass projects were all higher than US$70/MWh, this can be attributed to the small size of the proposed projects and the uncertainty of contractual arrangements.[10]
Interconnecting with Brazil is also particularly attractive. The expansion of the interconnection capacity with Brazil may be carried out either along the Coast or from Salto Grande. This expansion would contribute to diversifying the supply sources and could be done in order to take advantage of the installation of large thermal (coal) plants in the South of Brazil.[10]
Tariffs
For 2008, the overall weighted average tariff was US$0.139/kWh. Average tariffs for some sectors are presented below:
The only active energy project financed by the World Bank in Uruguay is the Energy Efficiency Project (PERMER), with a US$6.88 million grant from the Global Environmental Facility. The objective this project is to increase the demand for and competitive supply of energy efficiency goods and services, contributing to improved efficiency of energy use, reduced reliance of the Uruguayan economy on imported electricity and fuels, and reduced emissions from the energy sector.
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Renewable energy commercialization involves the deployment of three generations of renewable energy technologies dating back more than 100 years. First-generation technologies, which are already mature and economically competitive, include biomass, hydroelectricity, geothermal power and heat. Second-generation technologies are market-ready and are being deployed at the present time; they include solar heating, photovoltaics, wind power, solar thermal power stations, and modern forms of bioenergy. Third-generation technologies require continued R&D efforts in order to make large contributions on a global scale and include advanced biomass gasification, hot-dry-rock geothermal power, and ocean energy. In 2019, nearly 75% of new installed electricity generation capacity used renewable energy and the International Energy Agency (IEA) has predicted that by 2025, renewable capacity will meet 35% of global power generation.
Brazil is the 7th largest energy consumer in the world and the largest in South America. At the same time, it is an important oil and gas producer in the region and the world's second largest ethanol fuel producer. The government agencies responsible for energy policy are the Ministry of Mines and Energy (MME), the National Council for Energy Policy (CNPE), the National Agency of Petroleum, Natural Gas and Biofuels (ANP) and the National Agency of Electricity (ANEEL). State-owned companies Petrobras and Eletrobras are the major players in Brazil's energy sector, as well as Latin America's.
For solar power, South Asia has the ideal combination of both high solar insolation and a high density of potential customers.
The electricity sector in Argentina constitutes the third largest power market in Latin America. It relies mostly on thermal generation and hydropower generation (36%). The prevailing natural gas-fired thermal generation is at risk due to the uncertainty about future gas supply.
As of August 2020 Chile had diverse sources of electric power: for the National Electric System, providing over 99% of the county's electric power, hydropower represented around 26.7% of its installed capacity, biomass 1.8%, wind power 8.8%, solar 12.1%, geothermal 0.2%, natural gas 18.9%, coal 20.3%, and petroleum-based capacity 11.3%. Prior to that time, faced with natural gas shortages, Chile began in 2007 to build its first liquefied natural gas terminal and re-gasification plant at Quintero near the capital city of Santiago to secure supply for its existing and upcoming gas-fired thermal plants. In addition, it had engaged in the construction of several new hydropower and coal-fired thermal plants. But by July 2020 91% of the new capacity under construction was of renewable power, 46.8% of the total solar and 25.6% wind, with most of the remainder hydro.
As required by the Constitution, the electricity sector is federally owned, with the Federal Electricity Commission essentially controlling the whole sector; private participation and foreign companies are allowed to operate in the country only through specific service contracts. Attempts to reform the sector have traditionally faced strong political and social resistance in Mexico, where subsidies for residential consumers absorb substantial fiscal resources.
El Salvador's energy sector is largerly focused on renewables. El Salvador is the largest producer of geothermal energy in Central America. Except for hydroelectric generation, which is almost totally owned and operated by the public company CEL, the rest of the generation capacity is in private hands. With demand expected to grow at a rate of 5% in the coming years, the Government's 2007 National Energy Strategy identified several hydroelectric and geothermal projects as the best option to meet demand in the future and to diversify the country's energy mix.
The largely government owned electricity sector in Haiti referred to as Électricité d'Haïti (ED'H for "Haiti Electric Utility", faced a deep crisis characterized by dramatic shortages and the lowest coverage of electricity in the Western Hemisphere in 2006. with only about 38.5% of the population having regular access to electricity. In addition, Haiti's large share of thermal generation makes the country especially vulnerable to rising and unstable oil prices.
Brazil has the largest electricity sector in Latin America. Its capacity at the end of 2021 was 181,532 MW. The installed capacity grew from 11,000 MW in 1970 with an average yearly growth of 5.8% per year. Brazil has the largest capacity for water storage in the world, being dependent on hydroelectricity generation capacity, which meets over 60% of its electricity demand. The national grid runs at 60 Hz and is powered 83% from renewable sources. This dependence on hydropower makes Brazil vulnerable to power supply shortages in drought years, as was demonstrated by the 2001–2002 energy crisis.
Energy in Uruguay describes energy and electricity production, consumption and import in Uruguay.
Energy in Malta describes energy production, consumption and import in Malta. Malta has no domestic resource of fossil fuels and no gas distribution network, and relies overwhelmingly on imports of fossil fuels and electricity to cover its energy needs. Since 2015, the Malta–Sicily interconnector allows Malta to be connected to the European power grid and import a significant share of its electricity.
Italy's total electricity consumption was 302.75 terawatt-hour (TWh) in 2020, of which 270.55 TWh (89.3%) was produced domestically and the remaining 10.7% was imported.
Estonia's electricity sector is interconnected with regional energy markets, particularly through connections with Finland, Latvia, and Russia. The direct electrical interconnection with Finland was established in 2006 and was further strengthened by the Estlink 2 interconnector in 2014. Estonia joined the Nord Pool Spot market by 2012, securing its own price area within this regional electricity market.
Renewable energy has developed rapidly in Italy over the past decade and provided the country a means of diversifying from its historical dependency on imported fuels. Solar power accounted for around 8% of the total electric production in the country in 2014, making Italy the country with the highest contribution from solar energy in the world that year. Rapid growth in the deployment of solar, wind and bio energy in recent years lead to Italy producing over 40% of its electricity from renewable sources in 2014.
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Wind power in Uruguay generates a rapidly growing proportion of the country's electricity mix. In 2014, Uruguay installed the most wind power capacity per capita in the world. Overall, the majority of Uruguayan electricity generation is derived from hydroelectric sources.
There is enormous potential for renewable energy in Kazakhstan, particularly from wind and small hydropower plants. The Republic of Kazakhstan has the potential to generate 10 times as much power as it currently needs from wind energy alone. But renewable energy accounts for just 0.6 percent of all power installations. Of that, 95 percent comes from small hydropower projects. The main barriers to investment in renewable energy are relatively high financing costs and an absence of uniform feed-in tariffs for electricity from renewable sources. The amount and duration of renewable energy feed-in tariffs are separately evaluated for each project, based on feasibility studies and project-specific generation costs. Power from wind, solar, biomass and water up to 35 MW, plus geothermal sources, are eligible for the tariff and transmission companies are required to purchase the energy of renewable energy producers. An amendment that introduces and clarifies technology-specific tariffs is now being prepared. It is expected to be adopted by Parliament by the end of 2014. In addition, the World Bank's Ease of Doing Business indicator shows the country to be relatively investor-friendly, ranking it in 10th position for investor protection.
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