EU and Uruguay to strengthen energy cooperation, hydrogen in focus

To deepen the bilateral energy cooperation between the European Union (EU) and Uruguay, Commissioner for Energy Kadri Simson has visited the South American country.

The visit is said to be a part of the implementation of the commitments made as part of the EU-Uruguay memorandum of understanding (MoU) on renewable energy, energy efficiency and renewable hydrogen, which was signed in Brussels, Belgium, in 2023.

The commissioner’s agenda, among other activities, included participating in the fifth European Investment Forum on energy, as well as co-chairing the fourth EU-Uruguay Energy Dialogue with Uruguay’s Minister of Industry, Energy and Mining Elisa Facio to discuss the implementation of the MoU, with a particular focus on green hydrogen and energy efficiency.

During the forum, Simson reflected on the EU’s energy achievements, mentioning green hydrogen as a “technology with enormous potential to decarbonise key polluting sectors.”

The commissioner also noted that many European countries already estimate they will need more hydrogen or e-fuels than they can produce, adding:

“Europe has a strategic interest in developing a global trade in hydrogen and renewable fuels. Imported hydrogen and e-fuels at accessible prices will help Europe’s competitiveness and European industry to achieve their decarbonisation targets, in particular in transport and steel production. This creates great complementarity with partner countries with strong renewables potential and interested in creating trade corridors, like Uruguay.”

“Europe is one of the world’s largest energy importers. So we want to leverage this to support our partners around the world in their economic and green transitions, to become producers of clean energy and sustainable fuels. Latin America, and particularly Uruguay, is a strategic ally and a key partner in this effort. Uruguay stands poised to become a leading green producer of hydrogen and its derivatives, such as e-fuels, e-methane and ammonia.”

Simson stressed that Uruguay has many of the attributes including quality, abundant and complementary wind and solar energy, advanced electricity infrastructure and a good supply of fresh water, among others.

Furthermore, the commissioner claimed that the South American country has a “sound legal system and a stable political environment,” noting: “The recent opening of a government call to develop hydrogen projects through a USD 10 million fund that supports projects up to 10 years in construction, production, and different applications of green hydrogen like heavy-duty transport, e-methanol, e-kerosene, green fertilisers is an important step.”

“Uruguay is set to deliver hydrogen production which combines low cost green electricity, easy access to sourcing of feedstock like biogenic CO2 and water as well as proximity to transport infrastructure, like railways and ports. There are ideal conditions for a competitive production, for domestic use and for export to Europe or the rest of the world,” Simson emphasized.

To note, according to Simson, the EU is Uruguay’s largest investor at the moment, and there are ambitions to take the partnership even further.

As mentioned, the two parties signed a MoU on renewable energy, energy efficiency and renewable hydrogen, laying the foundations for future energy cooperation. Moreover, Uruguay was approved for the bilateral framework agreement with the European Investment Bank (EIB). This will allow the EIB to finance public and private energy projects in Uruguay, with a particular focus on green hydrogen.

“The Memorandum is already bearing fruit. The high-level dialogue between our authorities has intensified and we are advancing in developing our cooperation projects. In fact, in a short while, we’ll be announcing EUR 2 million in EU funding to implement the Uruguayan Green Hydrogen Roadmap – one of Uruguay’s top energy priorities,” Simson stated, adding that the EU will do all it can to support Uruguay as it consolidates its position as a “leading exporter of renewable energy.”