Paraguay Shifts Electricity Strategy Toward AI Data Centers
Paraguay is redirecting its electricity advantage toward artificial intelligence and high-performance computing infrastructure. AI and high-performance computing data centers are being offered 15-year power agreements priced at approximately $49 per megawatt-hour, creating a long-term alternative to the shorter arrangements used by cryptocurrency mining operators.
The clearest example is Kuntur, a company linked to Araico and the planned $12 billion Iguazú AI City project. Kuntur has secured a 15-year contract for up to 286 MW to power an AI data campus. The electricity supply will be phased in rather than delivered immediately, beginning with 6 MW in December 2026 before expanding toward the contract’s maximum capacity.
HIVE Digital Technologies Faces Major Exposure
HIVE Digital Technologies is among the public mining companies most exposed to Paraguay’s changing electricity policy. According to CoinDesk, approximately 77% of HIVE’s operating mining capacity is located in Paraguay, while research findings place the share at roughly 77% to 80%.
HIVE operates two facilities in the country: the Yguazú site, with capacity of about 200 MW, and the Valenzuela site, with capacity of approximately 100 MW. These facilities have supported much of HIVE’s recent hashrate growth. Under the current rules, however, that growth depends on electricity contracts with fixed expiration dates and no available renewal path.
HIVE is not the only operator facing pressure. Paraguay’s number of legal cryptocurrency mining operators has fallen from 71 to 41 after authorities intensified enforcement against illegal grid connections. Electricity costs have also increased: tariffs for crypto mining have risen to about $30/MWh, roughly twice their earlier levels, while operators must also meet upfront deposit requirements.
Why Paraguay Is Prioritizing AI Infrastructure
The shift reflects what the Paraguayan government appears to seek in exchange for access to its electricity: more employment and longer-term economic commitments. An AI data campus connected to a $12 billion development offers a broader economic footprint and a longer relationship than cryptocurrency mining projects operating under contracts that are set to expire.
The change does not mean revenue is disappearing from Paraguay’s electricity market. The national utility ANDE is expected to continue generating hundreds of millions of dollars annually from intensive electricity users, even as the composition of that demand changes from crypto mining toward AI and other high-performance computing operations.
What the Change Means for Miners and Investors
For HIVE shareholders, the central issue is what happens to roughly three-quarters of the company’s operating capacity after December 31, 2027. HIVE’s mining operations are paying about $30/MWh under contracts scheduled to lapse, while AI operators are being offered approximately $49/MWh under 15-year agreements.
The transition will also unfold unevenly. Kuntur’s AI campus is scheduled to begin with only 6 MW in December 2026 and then increase toward 286 MW. At the same time, cryptocurrency miners face a 2027 cutoff affecting 943.8 MW of contracted load. The timing creates uncertainty over how much electricity could remain unused or be reassigned during the shift.
Why This Matters
Paraguay’s electricity policy is becoming an important factor for both AI infrastructure developers and cryptocurrency mining companies. The government is signaling a preference for projects that combine substantial power consumption with longer contracts and broader economic commitments. For miners and investors, the next developments to monitor include HIVE disclosures about contingency plans, any regulatory changes that could reopen extension discussions, and additional long-term AI contracts from ANDE.
Frequently Asked Questions
What electricity agreement did Kuntur secure?
Kuntur secured a 15-year contract for up to 286 MW to supply an AI data campus linked to the planned $12 billion IguazĂş AI City project. The supply is scheduled to begin at 6 MW in December 2026 and ramp up gradually.
How much of HIVE’s operating capacity is in Paraguay?
Approximately 77% of HIVE Digital Technologies’ operating mining capacity is located in Paraguay, with research findings placing the share at roughly 77% to 80%.
What is the main risk for Paraguayan crypto miners?
The main risk is the expiration of existing electricity contracts without a renewal path under current rules. Miners also face higher tariffs of about $30/MWh, upfront deposit requirements, and stricter enforcement against illegal grid connections.
