Low electricity prices in Paraguay have put the landlocked South American country on the bitcoin mining map.
According to a decision by the country’s main energy authority, cryptocurrency miners will have to pay between 6 and 58 percent higher rates than incumbent users.
ANDE (National Electricity Administration) Decision No. 46984 states that the new tariffs will depend on the voltage of electricity consumed by customers and the timing of demand during peak hours.
The measure is intended for companies with high electricity consumption.
For example, Bitcoin miners and data center operators will have to pay an increase in electricity rates of 26 percent for the 220-kilowatt line, 36 percent for the 66-kilowatt line, and 41 percent for the 23-kilowatt line.
However, if the Bitcoin miner uses ANDE’s 23-kilowatt line, the increase is 58 percent.
Accordingly, Law 966 specifies how ANDE’s tariff is calculated, i.e., it covers all costs of generation, transmission, distribution, debt service, and the 8-10 percent rate of return required to perform electricity infrastructure work.
ANDE also indicated that the availability of electric energy would be reserved for the most productive sector, and a planned increase of 15 percent for the Bitcoin mining sector will not be sufficient to cover the operating costs of the electricity administration.
In August, ANDE requested new tariffs for the bitcoin mining sector.
Paraguay, along with Venezuela, is one of the countries with the lowest electricity tariffs.
Electricity is the primary input for Bitcoin mining, which bases its BTC issuance system on electricity consumption, an element of nature that can be constantly generated.