The Government of Paraguay has established an inter-institutional partnership between the National Power Administration (ANDE), the Supreme Court, and the Department of Justice, aimed at combating illegal mining activity which is putting a huge strain on the Paraguayan electricity grid.
The stated aim is to speed up procedures and increase cooperation between the three institutions, so that the Department of Justice can deal with the cases more quickly, whilst giving assurances that due process would be followed at all times.
Recently, ANDE announced the highest ever recorded electricity usage in the country, which coincided with widespread power cuts across the capital city Asuncion. Whilst this is not wholly attributable to Bitcoin mining operations, ANDE has been warning since 2022 about the impact of illegal mining operations, both in terms of the lost power, and the financial losses of stolen electricity which have been estimated at USD 400,000 per month.
According to the Department of Justice, there have been 60 reported energy-theft complaints related to cryptocurrency mining since 2019, with just 43 of those interventions being completed thus far.
The Government is keen to regulate the nascent industry, recently approving a policy which would charge cryptocurrency miners operating in Paraguay a rate for grid power which is 50% higher than for other industries.
Whilst some miners have complained about the viability of their operations after this price hike, Paraguay has one of the cheapest electricity costs per unit in the world, and additionally, provides fully clean and renewable energy derived from several large hydroelectric power plants built on it’s many large rivers.
Several large cryptocurrency mining operators, including Bitfarms and Pow.re, already operate in Paraguay and it is widely believed among industry participants that further growth of this sector of the Paraguayan economy is highly likely.
