As the world gathers in Paris, the Guardian reports on small countries who are making the transition from fossil fuels to renewable energy.
It focusses on Uruguay, often described as the most democratic, secure and peaceful country in South America. It is regarded as a high income country (top group) by the UN and contributes more troops to UN peacekeeping missions than any other country. The agricultural sector exports family-farmed produce, including combed wool, rice, soybeans, beef, malt and milk.
Jonathan Watts in Montevideo reports that in less than 10 years, Uruguay has slashed its carbon footprint without government subsidies or higher consumer costs, according to the country’s head of climate change policy, Ramón Méndez. In fact, now that renewables – wind, biomass, solar power and hydropower, provide 94.5% of the country’s electricity, prices are lower than in the past relative to inflation. There are also fewer power cuts because a diverse energy mix means greater resilience to droughts.
Fifteen years ago oil accounted for 27% of Uruguay’s imports and a new pipeline was just about to begin supplying gas from Argentina. Now the biggest item on the import balance sheet is wind turbines.
Wind, biomass and solar power, added to existing hydropower, mean that renewables now account for 55% of the country’s overall energy mix including transport fuel. The transport sector still depends on oil (which accounts for 45% of the total energy mix). But industry – mostly agricultural processing – is now powered predominantly by biomass cogeneration plants.
Energy investment in Uruguay over the past five years has surged to $7bn, or 15% of the country’s annual GDP. Ramón Méndez explains that as construction and maintenance costs are low, and investors are offered a secure regulatory environment, it is a very attractive prospect.
Compared with most other small countries with high proportions of renewables, the mix is diverse. While Paraguay and Lesotho rely almost solely on hydro and Iceland on geothermal, Uruguay has a spread that makes it more resilient to changes in the climate.
“For three years we haven’t imported a single kilowatt hour,” Méndez says. “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.” Heavy rain had boosted hydro output, allowing Uruguay to export energy to Argentina during four of September’s five weeks.
He adds that Uruguay has proved that renewables can reduce generation costs, can meet well over 90% of electricity demand without the back-up of coal or nuclear power plants, and the public and private sectors can work together effectively in this field.
And we look again at the proposals recently made, that quantitative easing should provide funding for our climate change programmes.