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    An Ambitious Energy Efficiency Law for Uruguay

    By Keith R | September 22, 2009

    Topics: Energy Efficiency | No Comments »

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    Yesterday Uruguay promulgated an ambitious Law on the Efficient Use of Energy (“UEE Law”) that may be  the broadest energy efficiency law yet in Latin America and the Caribbean (LAC). The law is largely the same as the bill proposed in 2008 by the President and drafted with help from a project funded by the Global Environment Facility (GEF).

    Uruguay has struggled in recent years to meet its energy demands, at times having to mandate tough restrictions on energy usage by commercial and residential users alike to compensate for shortfalls in supply. It depends heavily on imported fossil fuels and hydroelectric generation (vulnerable to drought), although the country is working to diversify into renewable energy sources (see here and here).

    A Master Plan

    The Law’s centerpiece is a 15-year National Energy Efficiency Plan that will map priorities and scheduled actions for implementing the Law, including:

    Energy Labels

    The Law says that no equipment utilizing energy for its functioning can be marketed in Uruguay that does not include nationally standardized information on energy consumption and performance via energy efficiency labels or seals. The information provided to the consumer regarding the energy consumption and performance of the equipment will be based on energy efficiency norms, in line with national technical norms, or absent that, those emitted by international standards organisms and included in national regulations. Equipment without proper labeling can be fined up to 100% of their sale price, and customs can block their import.

    Be Efficient or Be Taxed

    The Law gives the Executive Branch a choice: it either will set differential internal tax rates on all energy-consuming equipment marketed in Uruguay, or, failing that, energy efficiency minima setting minimum performance levels based on pertinent technical indicators. In so deciding the Executive is to consider the socioeconomic impact of the instruments, the adequacy of national production of more efficient technologies, and the population’s accessibility to more energy-efficient technologies.

    Article 14 places a 180% specific internal tax rate on equipment and artifacts of low energy efficiency, and empowers the Executive to change taxes on vehicles to reflect their fuel efficiency classification and use of alternative energy.

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