Paraguay's state electricity utility ANDE has announced that special power contracts for intensive users, including cryptocurrency mining operations, will end on December 31, 2027. No extensions are planned under current regulations.
The same utility is simultaneously signing 15-year contracts with AI and high-performance computing data centers, marking a significant shift in how the country allocates its surplus hydroelectric power.
Scale of the transition
The affected mining contracts collectively draw 943.8 MW from Paraguay's surplus hydropower generated by the Itaipú and Yacyretá dams. AI data centers are being offered 15-year agreements priced around $49/MWh.
Kuntur, a company linked to the planned $12 billion Iguazú AI City project, secured a 15-year contract for up to 286 MW to power an AI data campus. The supply will ramp gradually, starting at 6 MW in December 2026.
Impact on miners
HIVE Digital Technologies faces the most exposure among publicly listed miners. The company operates roughly 77 percent of its total mining capacity from Paraguayan sites, including two facilities: the Yguazú site at approximately 200 MW and the Valenzuela site at approximately 100 MW.
The mining sector in Paraguay has already contracted significantly. The number of legal mining operators has dropped from 71 to 41 following strict enforcement against illegal grid connections. Tariffs for crypto mining have risen to around $30/MWh, roughly double earlier levels, with operators now facing upfront deposit requirements.
Government priorities
Paraguay's shift reflects a preference for projects that create more jobs and commit to longer time horizons. Officials favor AI data infrastructure, which offers a larger economic footprint and extended contractual relationships compared to mining operations.
The utility is expected to continue generating hundreds of millions of dollars annually from intensive users despite the transition from mining to AI data centers.
Key questions ahead
The pricing and term differences are significant. Miners currently pay around $30/MWh on contracts set to expire, while AI operators receive 15-year terms at approximately $49/MWh. The timing gap between the ramp-up of AI capacity and the December 2027 mining contract expiration raises questions about how surplus power will be handled during the transition.
