Wind farm in Sierra de los Caracoles, in the department of Maldonado, southeast Uruguay.
Credit: Courtesy of UTE
In Uruguay, the Answer Is Blowing in the Wind
By Inés Acosta
Uruguay is undergoing a boom in investment in wind
MONTEVIDEO, Aug 27 (Tierramérica).- Uruguay needs to reinforce and expand its electric
power grid to absorb the 1,200 megawatts of wind
energy that it plans to generate by 2015.
This wind power target forms part of a larger goal
for the same year: to generate half of the energy
consumed in the country from renewable sources.
Investment in the production of wind energy is
undergoing a major boom. And as a result, the
state-owned electric power company, UTE, is faced
with the need to improve Uruguay’s power
At the moment, wind energy contributes only one
percent of the small South American nation’s
electricity, with three wind farms that generate a
total of 43 megawatts in the southeast: one
publicly owned farm in the department (province)
of Maldonado and two privately owned facilities in
the department of Rocha.
When the 1,200 megawatt target is met, wind energy
will account for 29 percent of the electricity
supply, UTE chairman Gonzalo Casaravilla told
Six contracts have already been signed and 12 more
will be signed soon for the generation of 930
megawatts in facilities to be installed over the
next few years, reported Casaravilla.
These ambitious plans encompass 21 new wind farms
in 11 departments in the northwest, west, centre,
south and southeast of the country.
According to Casaravilla, construction of these
new facilities will begin at the end of the year
and be completed in 12 to 18 months. In addition,
UTE plans to generate another 180 megawatts
through an agreement with the Brazilian state-
owned electric power company, Eletrobras.
While the entire country offers good wind energy
potential, the density of its electricity grid is
not as homogeneous.
“The grid was designed many years ago to take
electricity to where the people are, not to bring
electricity from those places,” explained the
director of the National Energy Office at the
Ministry of Industry, Energy and Mining (MIEM),
Uruguay has the highest rate of electrification
among all the countries of Latin America, with
98.8 percent service coverage. But with a
population of just under 3.3 million people and
almost half of them concentrated in the capital,
Montevideo, there are large stretches of very
sparsely populated areas. In these areas, “the
electric power lines are designed solely to
satisfy the needs of those few customers,” said
And when big wind farms are installed, “much
longer lines are needed to connect to a
sufficiently powerful first node to discharge all
of that energy,” he added.
This means that the ideal wind energy project is
one that is located “in a place where there are
good winds and good electric grid infrastructure
at the same time.”
This has turned out to be the main challenge. “In
the beginning it was easy because there was room
everywhere, but as distributed generation
gradually became denser, it became more difficult
to select appropriate locations,” explained
Two of the 18 wind farm projects proposed and
approved faced difficulties in connecting to
existing networks in the sites originally chosen,
in the departments of Tacuarembó and Florida. But
both were relocated to areas with better
connections, he noted.
“We have managed to find locations for all of the
projects for which bids were presented in the
tender held by UTE. There were really very few
places remaining with leftover capacity,” he
As a result, UTE plans to develop the power grid
infrastructure needed for the installation of new
wind energy facilities in the next ten years. “We
have plans to expand the grid in the north, to
make it possible to continue incorporating
distributed generation in accordance with the
demand,” said Casaravilla. Over the next five
years, around one billion dollars will be invested
in power lines and substations.
Right now, however, six companies want to build
eight wind farms in Pueblo Peralta, in the
northern department of Tacuarembó. This would
involve a total investment of 20 million dollars,
which would allow for the generation of 300
megawatts in an area “with excellent wind
potential,” Ricardo Pretz, the director of one of
the companies, PTZ Bioenergía Uruguay, told
The winds in this site “will make it possible to
install wind turbines with much longer blades, to
produce more energy. The result will be much more
profitable projects, allowing UTE to buy the
electricity at lower prices,” argued Pretz, whose
company forms part of the Brazilian group PTZ
Unfortunately, in this particular area of the
country “there are no possibilities of connection
to the grid, because the closest substation is
saturated,” he said. The companies are determined
to stick with this location, however, and have met
with Casaravilla and Energy Minister Roberto
Kreimerman for this purpose.
Casaravilla said that “today we cannot offer a
solution, because we need to see how the contracts
already signed develop.” The country will need to
continue installing wind farms after 2015 “and we
will have to study the best way to do it,” he
Méndez does not believe that the current
limitations of the power grid have dampened
private sector interest in wind energy, which he
described as “enormous”. “During this term of
government alone (which began in 2010) we have
surpassed 6.5 billion dollars in investment.”
For each tender held, around 20 projects have been
proposed through various international companies.
“Contracts are negotiated for periods of 20 years,
and thanks to this boom in the market, we have
managed to obtain very good prices, 50 percent
below average prices in Europe,” he said.
This results in costs of “around 60 dollars per
megawatt-hour, with no subsidies of any kind,
which is a key issue,” he stressed. These
investments will make it possible to reduce the
country’s electricity costs by an estimated 30
percent by 2015, he added.
Uruguay’s current energy policy was adopted in
2008 for the next 25 years; in 2010 it was
endorsed by all of the country’s political
The changes began in the electricity sector with
the first incorporations of wind energy (in 2008
there was a single turbine) and the large-scale
incorporation of biomass, said Méndez.
“In a short time we achieved very significant
change, given that we ended last year with a 46
percent share of renewable sources in the energy
mix as a whole,” he reported.
Hydroelectricity accounts for 20 percent, waste
biomass represents 12 percent, firewood makes up
another 12 percent, and the remaining two percent
is contributed by biofuels, solar power and wind
Achieving a 50 percent share of renewable sources
by 2015 is an “extremely ambitious” target, said
Méndez, since renewable energies currently account
for less than 12 percent of the global energy mix.
The development of renewable energy is key for a
country that has no hydrocarbon production and
depends on imported crude oil for its fuel supply.
In this area as well, however, there are an
increasing number of international companies
exploring for oil and natural gas in different
geological formations in Uruguay.