Uruguay is breaking new ground in decarbonising its transport and industrial sectors with the launch of the Kahirós green hydrogen project, the country’s first large-scale initiative to produce and use green hydrogen for heavy transport. Launched in December 2025 with an investment exceeding $30 million, the project is financed by Grupo Santander, the International Finance Corporation (IFC), and the UN-backed Renewable Energy Innovation Fund (REIF). Green hydrogen, produced from water using renewable energy, offers one of the most sustainable options for electricity, heating, and transport, yet less than five percent of green hydrogen projects globally have reached the investment stage, highlighting Uruguay’s initiative as a pioneering effort.
The UN in Uruguay has played a key role in mobilising capital for the country’s clean energy transition, with the Renewable Energy Innovation Fund providing flexible loans, technical assistance, and access to knowledge and technologies. Implemented by UNIDO, UNDP, and UN Women under the strategic leadership of the UN Resident Coordinator, the Fund collaborates with local banks to provide finance to SMEs and corporates, especially projects that advance gender equality. By de-risking early investments and aligning public policy with inclusive, gender-responsive finance, the Fund is helping to build a robust green tech ecosystem in Uruguay.
The Kahirós project integrates solar generation, hydrogen production, and a fleet of hydrogen trucks to support the decarbonisation of the forestry sector. IFC provides a $20 million green loan, including a 4.8 MW zero-carbon solar plant feeding the onsite electrolyser, with hydrogen compression and refueling facilities enabling continuous operations. The project will produce 77 tons of green hydrogen annually and reduce up to 870 tons of CO₂ per year, roughly equivalent to removing 300 cars from the road. Feasibility studies conducted by UNDP and UNIDO have reduced uncertainty for policymakers and paved the way for future hydrogen projects.
Uruguay’s success with Kahirós reflects a coordinated partnership between the public and private sectors, facilitated by the UN and the Renewable Energy Innovation Fund. The Government’s proactive leadership, including the 2023 national Roadmap for Green Hydrogen and fiscal incentives like tax exemptions, has been crucial in making the project financially viable. The UN played a central role in ensuring strategic coherence and fostering collaboration among investors, financiers, and government stakeholders, creating an enabling environment for this landmark initiative.
Beyond national impact, Kahirós serves as a blueprint for green hydrogen development in the Global South. With global demand for green hydrogen projected to reach 550 million tons annually by 2050 and unlock investments exceeding $11 trillion, Uruguay demonstrates how ambition, innovation, and partnership can turn potential into concrete progress. The project illustrates how middle-income countries can shape global energy trends through robust national strategy, forward-thinking policy, and strong public-private collaboration.
