The Republic of Uruguay covers an area of 176,215km2 and has a population of about 3.2M. The average annual precipitation is 1180 mm. The average total volume is 207.9km3/yr. There are six large dams in operation, four are for hydro power generation. The total volume impounded by dams is 17.29km3.

The gross theoretical hydro power potential in Uruguay (evaluated in 1993) is 32,000GWh/yr, and the technically feasible potential is 10,000GWh/yr. None of this potential is considered economically feasible for development at present.

Of the 2116MW of installed capacity in operation at present, 1541MW is hydro capacity, which includes Uruguay’s 945MW Salto Grande project on the Uruguay river (shared with Argentina).

No more hydro capacity is under construction or planned. Some projects have been delayed, and the high initial construction costs for schemes makes them unfeasible options.

In addition there are no plans for uprating or refurbishment of existing plants.

Increases in energy demand throughout the country are likely to be met through the development of natural gas plants or the conversion of existing thermal plants into combined cycle.

An open electricity market has been established, and the functions of generation, transmission and distribution are being split up. There is an external spot market (based on supply and demand) which determines prices for the export and import of energy. In the internal electricity market, legislation was introduced in 1999 to cover independent power producers.