The results speak for themselves. Today, Uruguay produces nearly 99% of its electricity from renewable sources, with only a small fraction—roughly 1%–3%—coming from flexible thermal plants, such as those powered by natural gas. They are used only when hydroelectric power cannot fully cover periods when wind and solar energy are low.
In 2005, Uruguay initiated a dramatic shift in its energy strategy, moving from petroleum-based electricity generation to renewable sources. In 2024, Uruguay generated 99 percent of its electricity from renewable sources using hydropower (42 percent), wind (28 percent), and biomass (26 percent).
Other concerns focus on cost and scalability. While Uruguay's approach has delivered low prices, some energy analysts worry that replicating the model in countries with higher demand could require costly improvements to transmission infrastructure and significantly more storage.
Uruguay's shift to renewables, he argues, demonstrated that clean energy can be cheaper, more stable, and create more jobs than fossil fuels. Once the country adjusted the playing field that had long favored oil and gas, renewables outperformed on every front: halving costs, creating 50,000 jobs, and protecting the economy from price shocks.
The increasing microgenerators within Uruguay also open the energy storage market for the country. Demand management regulations by UTE and new low-voltage contracts offered to consumers
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Historical Data and Forecast of Uruguay Residential Energy Storage Market Revenues & Volume By Operation Type for the Period 2020-2030 Uruguay Residential Energy Storage Import Export
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To support these initiatives, upgrades to Uruguay''s power grid will be necessary, creating significant opportunities in transmission infrastructure, smart grids, and energy storage solutions.
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