The government of Uruguay and the National Administration of Power Plants and State Electrical Transmissions (UTE) They are preparing new calls for proposals to incorporate solar generation , with the participation of private developers and a minimum goal of 500 MW of photovoltaic capacity during the five-year period.
The decision responds to the expected growth in demand, the advancement of electric mobility, the arrival of industrial investments and the accumulated delay in the incorporation of new capacity.
“Uruguay has made a recognized electrical transformation, but in recent years we have fallen behind in terms of incorporating new generation capacity, and this is something we need to correct now,” says Fernanda Cardona , Minister of Industry, Energy and Mining.
“That’s why we’ve set ourselves an ambitious goal for this five-year period: to expand renewable energy generation by at least 500 MW using photovoltaics. It’s a strategic necessity for the country,” he added during the 12th edition of the LATAM Renewables Congress , organized by AUDER.
Part of that growth will be channeled through new calls for bids from the private sector. UTE is working on the tender specifications, the remuneration mechanism, the required services, and the location of the plants.
The model under consideration envisions that the successful bidder will build the power plant, receive compensation for the installation and its associated services, and subsequently transfer the asset to the public company.
“All calls for bids will be in the form of tenders so that the private sector can participate, with a system where the developer is paid for all the services provided by that plant and then they are transferred to UTE,” confirmed Andrea Cabrera , president of UTE.
“There are other projects we are considering, and we hope to be able to announce before the end of the year which project could be developed entirely by private investors,” the executive revealed.
The definition will depend on the available capacity in the system. UTE is adjusting the technical conditions given that the third 500 kV transmission corridor will not be operational in the short term . that will connect the center with the south of the country.
The restriction will determine the location, capacity, and timelines of the first wind farms. It will also affect the complementary services that the winning bidders will be required to provide. However, the public entity acknowledged that the option being evaluated includes a fixed payment over a specific period , rather than payment limited to the energy generated.
“ We are designing that contractual part and what additional services it will provide. That royalty-type remuneration would include the remuneration for the power plant and all its associated services,” Cabrera emphasized.
The opening would represent a shift from the recent photovoltaic expansion. Until now, investments have been concentrated in UTE, which retains ownership of the assets and contracts third parties for engineering, equipment supply, and construction through EPC schemes.
Years ago, the state-owned company had planned to incorporate parks starting in 2026, with blocks of 100 MW annually until 2030. However, since that announcement, progress has only been made with the EPC tender for one 100 MW block.
Among the public projects underway is Punta del Tigre B , financed through a $27 million bond issue. The documentation identifies a capacity of 25 MW, although the company indicates it will reach 28 MW installed.
Adding to this development is the Melo photovoltaic park. The plant will have 75 MWp, approximately 140,000 panels, and an investment exceeding 75 million dollars , making it the largest solar installation in Uruguay.
The government also announced other plants distributed across departments in the interior of the country. The decision aims to avoid concentrating all the power in a single location and to use expansion as a tool for regional development.
“The private sector should be on the lookout because in a few months we will be announcing the terms of the solar energy tenders that will be developed for the private sector,” said the head of the country's energy ministry.
Hybridization and microgeneration complete the strategy
Furthermore, the Executive Branch acknowledged that they are analyzing the hybridization of existing renewable projects to incorporate additional technologies in areas and nodes that already have infrastructure.
The goal is to make better use of available connections and create a commercial alternative for established players.
“Why is this? For two main reasons. First, because it is much more efficient from a location and network standpoint. And second, because it is a new business model for people who have already invested in Uruguay and are already established. So, that is also a challenge for us, to see how we can hybridize the robust infrastructure that Uruguay already has,” stated Minister Cardona.
Meanwhile, the Ministry of Industry, Energy and Mining (MIEM) is finalizing a decree on microgeneration . The regulation will aim to support those who have already made investments and establish sustainable conditions for future growth.
“With this work, we also try to find a balance between what happened in Uruguay, what the people who are already established there expect, and to have a medium-term plan that is satisfactory and benefits the entire microgeneration ecosystem,” Cardona concludes.
The next phase will combine public generation, private capital, fixed-fee contracts, hybridization, and distributed resources . Its progress will depend on the publication of tender documents, the awarding of projects, and the availability of infrastructure to connect them.