Uruguay: The energy transition from ANCAP

This Ancap statement was translated from Spanish by an automated system

The global energy matrix has been constantly growing hand in hand with the increase in population and the growth of economic activity. The global energy matrix has been constantly growing hand in hand with the increase in population and the growth of economic activity.

Likewise, it has evolved either for technological reasons or for the application of energy sources, for availability of resources, for policies or to reduce the environmental impact.

Therefore, the global energy matrix has always been in constant change. Technologies or applications of energy sources also change over time.

By way of example, in the last 100 years, only firewood and coal were consumed and then oil and natural gas began to be added, nuclear and hydroelectric energy began to appear, and in the last 15 years other renewable energies: wind, solar and geothermal, evolving towards energy sources with lower carbon density.

Now, all forms of energy have significant impacts on the environment, no source of energy is perfect. In addition, more and more people have access to goods and the comfort of modern life. Therefore, the solutions sought to reduce the impact of energy have to be viable on a global scale.

And there is also a challenge of time, a change in the energy matrix is not decreed from one day to the next. A responsible transition will take decades to achieve carbon neutrality commitments, and all forms of energy (with corresponding carbon intensity reductions) will be required to supply this growing demand.

The concept of the energy trilemma is well known: energy sources must be affordable and universally accessible, be reliable 24/7 without system disruptions, and must be sustainable, that is, with minimal environmental and climate change impacts. All three dimensions are very important and any successful and lasting energy transition must address all three elements of the trilemma.

In conclusion, the responsible energy transition implies the availability of accessible and reliable energy, which sustains a growing economy and care for the environment, as well as necessarily implies the coexistence and competition of all forms of energy.


Goals

At ANCAP, we have a new Energy Transition management whose purpose is to promote the development of low carbon intensity energies within the company, aligned with a responsible energy transition, which is not instantaneous and will take at least a couple of decades. articulating the businesses of Green Hydrogen and the Development of Renewable Energies with those of Exploration and Production of hydrocarbons, maximizing the synergies between them.

The objectives aim to promote the development of energy resources in Uruguay, through:

- The concretion of contracts for the evaluation of the feasibility and potential production of hydrogen (H2) and/or derivatives, from renewable energies generated in offshore areas (offshore) of the Oriental Republic of Uruguay, with leading companies in the sector. energetic.

- reactivate the activity of hydrocarbon exploration of the entire offshore, at the entire cost and risk of private energy companies, through the signing of contracts for the offshore areas that have already received offers, which will allow a significant level of investment to be returned to and business participation.

- Generate knowledge for the production of sustainable fuels, biofuels and other projects or operations related to energy transition, eg. underground storage of CO2 (and other fluids).

How will ANCAP lead the transition?

Uruguay has decarbonized practically all of its electricity generation, has abundant renewable resources and is an excellent destination for foreign investment, so it has all the conditions to be a pillar in the global green H2 economy. In this way, our country will be able to meet its “carbon neutrality” commitments by 2050 and export renewable energy in the form of green H2 and/or its derivatives.

The MIEM defines the energy policy and consequently the green hydrogen strategy. ANCAP is the autonomous entity with experience and capabilities to promote and supervise the operation of offshore energy projects, particularly since the final product of these contracts are molecules (H2 and/or its derivatives) and it is not electrical energy.

At ANCAP we have managed to attract more than 1,200 million US$ of investment at risk and cost from international oil companies in the exploration of hydrocarbons, through the Uruguay Round projects, we have highly qualified human capital, experience in operations and the offshore data. All of these assets are being adapted to new low-carbon energy projects. Therefore, ANCAP is following the path that oil companies are already following globally, transforming themselves into energy companies.