Uruguay electricity exports sizzled in 2021 as officials forecast slower 2022

The electric power sector helped drive a 43% increase in Uruguayan exports in 2021, investment and trade promotion agency Uruguay XXI said.

The South American nation’s overall exports for the year were US$11.5bn. 

Amid an uptick in demand from drought-hit Brazil, electricity exports jumped 632% to US$594mn.

In a report, Uruguay XXI said the increase in revenue reflected “much higher” export prices compared with that of previous years.

Prices averaged US$170/MWh in January-October and sales were around 2,600GWh for the period, more than double that exported in the whole of 2020.

Brazil, which boosted power imports from Uruguay and Argentina last year to mitigate the impact of a drought on hydroelectric output levels in the south, accounted for US$489mn of the total. In 2020, Brazil imported around US$50mn of Uruguayan power.

Last year, Argentina bought US$105mn of Uruguayan power, up from US$31mn, chiefly reflecting higher prices as imports fell. According to data from Argentina’s wholesale power market administrator Cammesa, the country imported 612GWh from Uruguay in 2021, down from 709GWh in 2020.

Argentina, also experiencing drought conditions, boosted liquid fuels-fired generation last year.

Uruguay XXI said exports of power to Brazil may remain at elevated levels in 2022 given that water levels are still low despite improvements registered in the last few months of 2021.

The agency forecasts overall power exports to drop 50% this year to US$297mn and for prices to also decline. Uruguay obtains the bulk of its electricity from renewable sources, chiefly wind.

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The country’s total exports are expected to climb 5% to around US$12.1bn this year, with Uruguay XXI adding that trade agreement talks should advance.

Uruguay’s three biggest export markets are China (chiefly beef, cellulose and soy), Brazil (mainly electric power, malt and plastics) and the EU (chiefly cellulose, beef, and wool and fabrics).