The fossil fuel industry likes to make out that it is a pipe dream to think that we can completely replace fossil fuels with alternative sustainable sources. But the example of Uruguay shows that it is not only possible but the transformation can be done in as short a time as five years.

By the early 2010s, Uruguay’s government realized that continuing to rely on imported fossil fuels was economically unsustainable. Méndez Galain, then a particle physicist with no formal experience in the energy sector, proposed a bold plan: to build a system that relied almost entirely on domestic renewable resources—wind, solar, and biomass—and do it in a way that was cheaper than fossil fuels.

The results speak for themselves. Today, Uruguay produces nearly 99% of its electricity from renewable sources, with only a small fraction—roughly 1%–3%—coming from flexible thermal plants, such as those powered by natural gas. They are used only when hydroelectric power cannot fully cover periods when wind and solar energy are low. The energy mix is diverse: while hydropower accounts for 45%, wind can contribute up to 35% of total electricity, and biomass—once considered a waste problem—now makes up 15%. Solar fills the gaps.

The economic impact has been profound. The total cost of electricity production decreased by roughly half compared to fossil-fuel alternatives, and the country attracted $6 billion in renewable energy investments over a five-year period—equivalent to 12% of its GDP. About 50,000 new jobs were created in construction, engineering, and operations, roughly 3% of the labor force. Even more striking, Uruguay is no longer subject to the wild swings of global fossil fuel markets.

This transformation was not just technical; it was also regulatory and structural. Uruguay moved to long-term capacity markets, providing investors and utilities with predictability while removing the bias that favored fossil fuels. The government’s adaptive approach, maintained through five administrations, ensured consistency. Instead of making climate the primary focus, policymakers prioritized cost, reliability, and economic benefits; emissions reductions were a valuable bonus.
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What makes Uruguay’s example compelling to policymakers is not just environmental performance—it is economic rationale. Méndez Galain repeatedly emphasizes that renewables became dominant because they were cheaper and more stable than imported fossil fuels, not because of carbon targets. That economic lens, he argues, is essential if countries want sustained adoption of clean energy.

“Climate policies fail when they are disconnected from economics. The transition works when it saves money and creates jobs,” he says.
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For Méndez Galain, the message is simple: “The question is not whether renewables can work. The question is whether governments have the courage to change the rules. If they do, the rest is straightforward.”

The world overlooks Uruguay’s example at its own risk. In fact, renewables are ready, the playbook is in place, and the advantages are tangible. The only missing ingredient is the political will, which is often clouded by self-interest and money.

I wondered what the country’s leadership was back in 2010 that was so enlightened that it picked out Méndez Galain to design a new plan and, what is even more incredible, seemed to give him all the freedom and support he needed to implement it. I looked it up and was not surprised that the person elected to become president in 2010 was Jose Mujica, a truly remarkable leader who was president until 2015, by which time this ambitious energy plan had became reality.

I wrote about Mujica back in 2013 and, if you read that post, you can see that he was a very humble man who felt that the government should serve the people and its leaders should live like the majority of them. not like kings or a privileged minority. What an extraordinary idea!

Mujica lived and governed as he preached. He died in May of this year at the age of 89, a much beloved leader. You can see from this interview he gave during the last year the humble house that he lived in with his wife even while he was president, because he rejected the presidential mansion with its staff of 42. They had no servants and his security detail consisted of two plainclothes policemen who were parked on a nearby dirt road.