Building a more secure and affordable energy system
One year after installation, the data gathered from the project sites was analyzed and compiled into a replicability study evaluating the benefits of further projects integrating solar and storage in the agricultural sector and more broadly. We identified a variety of positive outcomes making a tangible difference in community members’ lives.
The potential of installations combining solar and storage such as that at Klaus Dietrich’s farm is especially promising, as the farm saw both significant savings and improved energy security.
Electricity is one of the highest operating costs incurred by farmers in the production of dairy. The installation of solar panels and storage behind the meter allowed for significant savings on energy.
Solar panels alone generated significant savings for the community; at Alfred Regehr’s farm, a total of 3,305.58 USD was saved over the course of one year, as energy generated by the panels was able to be both deployed and sold back to the grid. Similarly, the carport installation generated 5,091.98 USD in savings for the community.
At Klaus Dietrich’s farm, where both solar and storage technologies were installed, savings of approximately 3,927.92 USD were generated over the first year of operation. Though technical issues with the battery system curtailed storage throughout some of the year, moving forward, the optimized system should produce even greater benefits for the farmer.
Hydro-Québec was pleased to work with the local partners to introduce new technologies in Uruguay. In line with the values of Hydro-Québec, to provide clean energy, we are happy to have contributed with our expertise in the value chain of the dairy industry. The savings and energy security benefits of the project are enjoyed by the community and will contribute in the years to come.
Due to its remote location, Colonia Delta frequently experiences power outages. Diesel-powered generators are typically used by dairy farmers to ensure cooling continues during these situations, preventing the loss of milk. Farmers thus incur additional costs to purchase the fuel powering the generators, which have an environmental impact, as well.
At Klaus Dietrich’s farm, the energy storage system was connected to an emergency circuit on the electric panel powering the milk cooling system. When full, the battery can ensure approximately three hours of milk cooling. This reduces reliance on the diesel-powered generator, lowering costs and further decarbonizing the farm.
The ability of the battery system to compensate for temporary outages is a critical benefit, particularly when considering the possibility of replicating the project in similar rural areas.
The solar and storage system installed by GSEP and its partners has helped me reduce operational costs. Now, we can use the photovoltaic energy stored in the batteries during peak hours. This has helped the profitability of the farm and our carbon footprint.
Solar panels are already widely used and available in Uruguay; however, the usage of energy storage systems is very new for the market. The intervention at Klaus Dietrich’s farm was the first project in Uruguay to integrate behind-the-meter batteries with the national grid. This project was an important learning experience for both the farming community and the local utility, UTE, which had never before overseen the implementation of an energy storage system by a private landowner behind the meter.
For Klaus Dietrich’s farm, the integration of batteries allowed for a significant reduction in operating costs. The electricity required to produce milk is one of dairy farmers’ highest costs; the savings enabled by the solar and storage system demonstrate the value of these new technologies to the community.
More broadly, the project helped clarify the potential of battery storage systems and encourage adaptation to emerging technologies incorporating batteries and energy resale. It sought to demonstrate that the integration of batteries coupled with renewables to the grid could strengthen energy security in Uruguay. The experience gained by all stakeholders over the course of the project implementation will ideally help pave the way for a simplified replicability process across Uruguay.
The replicability report, which analyzed the cost of the project were it to be taken on by the community today, sheds light on the crucial role government support will play in the widespread adoption of similar technology.
When the project was first implemented in 2019, costs for solar panels and storage systems in Uruguay were significantly higher than what was observed in the US and European markets at the time. In general, costs for all implicated technologies are decreasing worldwide.
Calculations performed for the replicability report found that if the project were to be replicated in 2023, the solar-only installation at Alfred Regehr’s farm would require an investment of only 63% of the 2019 cost, while the solar-and-storage installation would cost 81% of 2019 levels.
The energy savings created by the integration of photovoltaic and DER technologies could result in increased profitability and competitiveness across Uruguay’s agricultural sector. In Uruguay, photovoltaic technology is considered a clean technology. This classification makes it eligible for government subsidies available to farmers in the form of tax credits (COMAP). While it comes with various conditions regarding the type of investments that must be made, the program can reduce the costs to farmers by over 50%, allowing for a much speedier payback time on the initial investment.
These differences shed light on how essential policymakers’ support is in driving the energy transition. Falling costs of technology and the availability of subsidies can accelerate the adoption of renewables and related innovations not only in Uruguay but around the world.
Uruguay’s energy mix is already heavily decarbonized, relying strongly on hydropower, solar, and wind. The amount of energy generated through these sources naturally fluctuates over time, influencing grid stability. By incorporating battery storage systems, our project demonstrates one path to building stronger, more stable decarbonized grids.
Storing energy generated by renewables in batteries creates a backup system allowing consumers—in this case, Klaus Dietrich’s farm—to receive the same amount of energy regardless of conditions. Even on cloudy days, energy provided by the battery can ensure that the farm is still powered by solar energy.
These benefits are transferrable to energy generated with all intermittent renewable sources, not only solar power. The usage of energy storage systems can pave the way for the stable and effective decarbonization of the energy mix across contexts.
In identifying the rural Colonia Delta community as the site for the project, the project emphasized the importance of just and fair access to electricity. As part of the implementation of the project, GSEP and its partners provided dedicated training to the community. As a result, these locals are now experts at operating these advanced systems and have gained a deep, firsthand understanding of the benefits.
Solar panels are becoming more and more accessible even in the most remote areas and regions, thanks to government subsidies encouraging adoption, improved technology, and lowered costs. As the farmers in Colonia Delta have concrete experience with the benefits of adopting these systems in terms of costs and energy security, there is a potential for replicability encouraged by grassroots activism both within the community and across the region.
Our region is home to many of Uruguay’s vibrant dairy farming communities. It has been a pleasure working with GSEP to implement this project, which has already improved the quality of life for several of our citizens. With the potential for replicability, we look forward to supporting other dairy farmers in the Intendencia de San José in implementing these new technologies following the pathway paved by GSEP and its partners.
See the project in action: