Important factors to be considered when devising projects for the production of biodiesel in Uruguay, include agricultural and political impacts.
Biodiesel production is of national interest to the Government of Uruguay. Act 17.567, article 3 prescribes that taxes are not payable up to
100% if the alternative fuel is derived from raw material of either animal or vegetable origin. ANCAP (Uruguay’s national fuel company) intends
to work with PFI (Private Funding Initiatives) companies.
Most Latin American countries including Uruguay have the potential of mass producing raw material for biodiesel and ethanol production as
stated by the United Nations Agricultural Fund (FAO). Higher costs of petroleum production and the lower costs of agricultural production in
South America give rise to the unique scenario of developing further this new industry. World production of liquid fuels like ethanol and
biodiesel is at 1 % of world demand and uses 1% of the arable land available worldwide to produce. It is anticipated that production will reach
4% by 2030.
