Wind Energy in Uruguay

Uruguay is a small country (at least for South American standards) but it is intentioned to become a giant in wind power, somehow like Denmark in Europe.

The country has an ambitious plan of reaching 1,2GW of installed wind power in the next 3 years: considering that present generation capacity is about 2,6GW the figure appears even bigger.

Currently, only 2 wind farms are installed and operational, Sierra de los Caracoles and Kentilux (43MW).

Right now the Uruguayan energy mix is based mainly on a hydro plant shared with Argentina and several gas turbines.  Due to the strong economic growth experienced in the last years (GDP is growing at a steady rate around 3.5%), the country has an urgent need for more installed capacity.

Another very solid reason to increase the installed capacity is to sell energy to the neighbors. The line to Argentina can handle 200MW and the connection to Brazil 70MW (although there is a project to improve this connection in the next years up to 500 MW).

Several developers are active in the market: among the biggest players the argentinians Impsa and Fingano, together with Teyma (Abengoa group) and the local Ortegui Group, plus many other competitor asking for prices per MWh that are dropping quickly.

I’ve been visiting the country for a wind farm we are building there and my impression is that the 1,2GW target in such a short time is unrealistic for several reasons.

First of all, the size of the local companies: the biggest have about 2-3000 employees, a respectable number for a 3 million inhabitant country, but inadequate for the potential workload (if several wind farms are built together, we can easily saturate the concrete producing capacity and absorb a considerable percentage of the skilled workers).

Secondly, there are huge logistic problems: the harbor is not prepared to handle the amount of blades, tower section and nacelles needed for all the projects in the pipeline, not to talk about the special transport needed and the cranes for installation.

Then, there are some less obvious problems: UTE, the almighty local utility, take it’s time to analyze each problem and to answer technical questions. This too can lead to delays uneasy to forecast. And they must solve connection issues as well, because grid connection will not be easy.

After, there is a somehow peculiar local environmental regulation setting the minimum distance from a wind turbine to a property line from 170 to 300 meters (and an equivalent limitation asking for a buffer of 3000 meters to the nearest home): this can complicate the layout, affecting negatively the power output and complicating the project without clear benefits.

But looking at the brightest side of life, there are several positive aspects: the legal framework is stable, economy is growing with inflation under control, the local companies looks prepared and from a civil work point of view it’s an easy country, flat with an uncomplicated geology.

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