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Diversifying the Energy Matrix in Uruguay

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Investment summary

Palmatir S.A


Uruguay Uruguay


20 years


$41.7 million

Total project cost

$ 143.6 million

Year of Closing


Project Description

Drive across Uruguay today and you’re likely to see rows of giant windmills sharing space with grazing cattle on the open plains. The country has long been known for the quality of its beef, but only in recent years has it drawn worldwide attention as a leader in wind energy.

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In 2016, Uruguay covered 97 percent of its electricity demands from renewable sources—23 percent from wind—thanks in large part to investments by the private sector. Less reliant now on hydroelectric power, the country has become less vulnerable to drought and less dependent on fossil fuels to fill in any gaps. Once a net importer of electricity, it is now a net exporter.

The IDB Group has been instrumental to the boom in wind energy, both in terms of the public and the private sector. Early on, when the government was embarking on its energy diversification strategy, we provided support in addressing technical issues and developing a sound regulatory framework. We worked with the national utility to help structure power purchase agreements and other contractual arrangements that would make wind energy more attractive to private investors while still benefiting ratepayers.

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One of the first utility-scale wind projects to get off the ground—built by Palmatir S.A.—opened in May 2014 in the north-central department of Tacuarembó, adding 50 MW of clean energy to the matrix. We provided a 20-year loan for that project and have financed several others since.

In addition to furthering the country’s energy diversification, we have introduced new financing options for renewable energy. In 2017, IDB Invest structured a long-term, $135.8 million B-bond to refinance an existing construction loan on another Uruguayan wind farm, Campo Palomas. The issuance of the green bond generated such high levels of interest from institutional investors that it was oversubscribed.


The IDB Group was in on the ground floor with wind energy in Uruguay, which as of 2016 supplied nearly a quarter of the country’s electric power.