Uruguay is Receiving Free HydroElectric Power from Brazil This Winter– Altruistic Gesture or Ugly Bargain?
Several weeks ago, the International Herald Tribune reported that Brazil will lend some hydroelectric power to its neighboring country of Uruguay during July and August of this year, the coldest months of South America’s winter. Uruguay, like many South American countries, is currently struggling to meet its energy needs.
Under the arrangement, Uruguay will begin to pay back the energy to Brazil once the winter demand for electrical heating ends. For the past four years, similar arrangements have been made. Brazil is currently in negotiations with Uruguay to build a coal-powered thermoelectric plant near where the countries border. I can’t quite put my finger on why, but I find this rather simple news story intriguing.
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I wonder if Brazil is actually quite kind in their willingness to help a neighbor, or if they just want to use these energy loans as a way to take advantage of Uruguay. Perhaps that want to gain negotiating leverage in regard to the thermoelectric plant. Any one have any perspective or information about the issue? Does anyone know of any other occurrences of one country providing loaned energy to another? In other words, I’m asking about an exchange of energy, rather than a financial transaction.
Photo Credit: ogwen on Flickr under a Creative Commons license
Brazil has similar arrangements with Argentina also! Is nothing new in the context of the MERCOSUR integration agreement.
Actually, the coal plant will be located in Brazil, but will be an uruguayan plant, that means the plant will be funded entirely by uruguay. It will be located in Brazil to reduce the cost of transport of the brazilian coal the plant will use.
This is great! My spirits have just lifted so much to know that we have countries on the earth beginning to awaken to and change the fact that, “The world is drinking from a cup no one wants to share.” This should be all over world headlines to share the value of helping fellow humans as friends and not strangers. I’m so grateful for Uruguay and Brazil in their example for the world! Wow, I thought this world was going to hell but this is very inspiring and I’m sure Uruguay and Brazil feel mutually great in their new shared love of life. GOD BLESS THE WORLD! PEACE!
Brazil has several hydroelectric plants up stream the Uruguay river that runs in its territory, doing that causes that the water levels further down stream, where Uruguay and Argentina share one of such plants at Salto Grande, do not generate its full potential, or almost nothing at all. So this “gesture” doesn’t look as such to me. BIG FISH EATS SMALL FISH!!
[...] ethanol producers, Brazil is also funding research for biofuels, planning to build new hydro and thermoelectric dams, and will now be drilling for oil in recently discovered reserves that are located off of [...]
I don’t think Brazil is trying to take advantage of Uruguay and neither would Uruguay do anything to hurt Brazil. As Brazil has not done anything to Bolivia when their government decided to take over one of the gas plants we build in their country. This type of things can be negotiated with the need of hard actions.