At the turn of the millennium oil accounted for 27% of Uruguay’s imports Today its biggest import is wind turbines. In under 10 years Uruguay slashed its carbon footprint and now generates nearly 95% of its electricity—and over half of all its energy—from renewables. All, reports The Guardian, without the help of government subsidies or increased consumer costs.
In Paris, Uruguay is being praised by the World Bank, Economic commission for Latin America and the Caribbean, for its successfully decarbonising economy. Within two years, Uruguay’s head of climate policy, Ramón Méndez, pledged, the country will have achieved an 88% cut in greenhouse emissions from its average from 2009 to 2013.
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There are “no technological miracles involved.” The Guardian reports. Uruguay doesn’t use nuclear power and hasn’t added any hydro since the 1990’s. Méndez says their success story is dull, and replicable.
What Uruguay did was establish a stable financial climate for investors, in part by offering 20-year fixed-price purchase contracts for power from the state utility.
“What we’ve learned is that renewables is just a financial business,” Méndez explains. “The construction and maintenance costs are low, so as long as you give investors a secure environment, it is a very attractive.”
Renewable energy now sustains a US$7 billion industry in Uruguay, nearly 15% of annual GDP. “For three years we haven’t imported a single kilowatt hour,” Méndez boasts. “We used to be reliant on electricity imports from Argentina, but now we export to them. Last summer, we sold a third of our power generation to them.”
There’s an additional plus for Uruguay. Wind farms feed into the grid allows hydro power plants to maintain reservoirs far longer into dry seasons than before. According to Méndez, this has decreased energy instability and vulnerability to drought by 70%. There are also fewer power cuts due to the diversity of renewable generators.
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