The Uruguayan energy market has positive prospects for the start of 2025, when Argentina already anticipates that it will need to import from neighboring countries to cover the increase in demand in the summer months.
Uruguayan electricity exports to the region exceed the forecasts that UTE, the country's state-owned electricity company, had for the year, in a context where Argentina has consolidated itself as the main client, and with prospects that sales will continue in the summer months towards that market.
As of September, total sales to the region (most of which were surplus generation) amounted to around US$ 104 million, of which US$ 95 million correspond to exports to Argentina and the rest to Brazil. The state-owned company had estimated in its financial program that revenues from this concept would be around US$ 60 million in the current fiscal year.
Placements towards the neighbouring shore gained strength from May onwards, due to the increase in demand due to the drop in temperatures and restrictions in the gas sector. Demand continued to consolidate in the following months and peaked in August, with operations carried out at an average price of US$ 80 MWh, according to official data.
Unlike in previous years when there were delays in payments, this time Argentina is up to date and has paid off everything it has purchased to date, El Observador has learned.
ARGENTINA'S PLAN AND AN OPPORTUNITY FOR URUGUAY
On Wednesday it was announced that the government headed by President Javier Milei has drawn up a contingency plan with the aim of avoiding power outages during the summer, when consumption will increase due to high temperatures.
One of the points of the plan establishes that "all actions must be taken to obtain the import of energy and power from neighboring countries during hours of high demand on critical days that will be defined in due time by the Wholesale Electricity Market Administration Company (Cammesa) and crucially during peak hours."
This announcement made in the last few hours confirms the forecasts that the demand for Uruguayan electric energy will continue in the short and medium term. In fact, officials from both countries have already begun to coordinate for several weeks the conditions under which these exchanges could take place in the summer, said the president of UTE, Silvia Emaldi, to El Observador .
One thing to consider is that at the beginning of summer, the demand for electricity also grows in Uruguay, and under normal conditions it is covered without problems with generation from renewable sources. Under these conditions, the local electrical system could also cover Argentina's requirements with surpluses of renewable energy at specific times.
But it may also be necessary to have thermal generation backup to ensure a response to Argentina in critical situations. To the extent that UTE has to schedule the start-up of one of its plants for this purpose, the client is required to pay money in advance.
These are some of the points that the two parties are currently trying to fine-tune.
Currently, Uruguay makes daily offers of energy blocks to Argentina and Brazil, which these countries take or not to the extent that they find convenient to optimize their systems at specific times. These offers are made by UTE in its role as marketer and the Electric Market Administration (Adme) establishes the minimum price to be received for each energy block.
HOW ARE THE DAMS IN URUGUAY?
The president of UTE pointed out that the hydroelectric dams are at "full capacity" and that even the rains registered in the last few weeks have led to the need to discharge water in some power plants on the Río Negro. Currently there are forecasts that predict months with less rain due to the arrival of the La Niña phenomenon, but that it will pass in a moderate manner.
99% RENEWABLE ELECTRICAL GENERATION
So far this year, 50.5% of energy demand in Uruguay has been supplied by hydroelectric power. This is complemented by wind power (32.8%), biomass (12.7%), solar (2.8%) and thermal energy (1.2%).
