PARAGUAY · ENERGY
Key Facts
- —The country Paraguay is a landlocked South American country that shares the giant Itaipú hydroelectric dam with Brazil.
- —Why it matters A US cloud company plans to sell computing from Paraguay to US customers, and the price of its electricity now has a number.
- —Why now Paraguay’s state utility ANDE signed the supply contract on 22 or 23 October, as Crusoe announced its partnership with Araico on Thursday 22 October.
- —What happened ANDE agreed to supply up to 286 MW for 15 years to the Yguazú campus at US$48.91 a megawatt-hour on the high-voltage line.
- —The numbers Supply starts at 6 MW on 1 December 2026, rises to 146 MW from April 2028 and reaches 286 MW from April 2029, with prices rising at least 2.5% a year.
- —What it means for you US readers get a first price for AI computing powered by South American hydropower, about 4.9 US cents per kilowatt-hour.
- —Still open How Crusoe fits into a contract signed with Kuntur, and whether the start dates match Crusoe’s mid-2027 plan.
- —Power Index Paraguay ranks 10th of 14 in The Rio Times Latin America Power Index, with 36.0 points (October 2026 edition).
The Paraguay AI hub has its power contract, as the state utility ANDE agreed to supply up to 286 megawatts (MW) for 15 years to a data campus at Yguazú, ABC Color and Última Hora reported on Friday 23 October 2026. The price is US$48.91 per megawatt-hour (MWh) on the high-voltage connection, or about 4.9 US cents per kilowatt-hour.
For US readers the link is Crusoe, a US company that said on Thursday 22 October it will build AI computing beside the Itaipú dam to serve US cloud customers and Latin American demand. The contract that prices the electricity, however, was signed with a Paraguayan company called Kuntur that is linked to Araico, and the reports do not name Crusoe as a party.
We covered the 21 October US announcement in Paraguay AI Hub Ties 2 Firms to Itaipu Power, which listed this contract as the open question. This article covers the price and the terms that have now come out.
How the Paraguay AI Hub Contract Works
ABC Color, citing ANDE president Miguel Báez, says the 15-year contract was signed with Kuntur, a Paraguayan company linked to Araico, for the Yguazú site in Alto Paraná. ABC Color and the Paraguayan outlet TVS date the signing to Thursday 22 October, while Última Hora describes Araico director Alejandro Zuccolillo signing on Friday, so the exact day is not settled.
Power starts on 1 December 2026 at 6 MW through a 23-kilovolt feeder, ABC Color says. From 1 April 2028 the campus moves to 146 MW on a 220-kilovolt line, and from April 2029 it reaches the 286 MW ceiling.
Báez said the ceiling is firm, and that if the campus needs more than 286 MW it must find other generation and not ask ANDE. ABC Color notes that 286 MW equals the installed capacity of the Acaray plant plus 66 MW.
The company pays for the connection works at Yguazú, which then become ANDE assets, Báez said. He added that ANDE’s planning division set the tariff as a technical rate and that ANDE carries full responsibility for it.
The Price in Numbers
At 23 kilovolts, where the project starts, the average tariff is US$56.39 per MWh, and at 220 kilovolts it falls to US$48.91, ABC Color reports. The 220-kilovolt rate comes from a new ANDE customer group for energy-intensive advanced-technology industry.
The price is indexed each year to US inflation with a floor of 2.5%, and every two years it is reviewed for changes in ANDE’s generation cost, ABC Color says. Industry and Commerce Minister Marco Riquelme called it the first 15-year contract in Paraguay priced in dollars.
Zuccolillo told Monumental radio, as Última Hora quotes him, that the deal closed at a little over US$48 and is the most lucrative contract in ANDE’s history. He compared it with US$35 charged to Paraguayan industry and US$44 charged to cryptocurrency miners.
Our arithmetic shows the scale: 286 MW running every hour of a year is about 2.5 million MWh, which at US$48.91 would bill about US$123 million a year before indexation. That is a ceiling, since the campus starts at only 6 MW and real use will be lower.
Zuccolillo said the yearly rises would lift the average tariff above US$75 per MWh over the contract. Our check finds that 2.5% a year from US$48.91 averages about US$58 over 15 years, so his figure would need faster US inflation or terms the reports do not describe.
Where Crusoe Fits In
Crusoe’s release says the partnership will start with an initial deployment in mid-2027, with a path to 106 MW of IT capacity and long-term options for about 280 MW in total. It says the site sits next to the Itaipú substation and will serve both US cloud customers and demand across Latin America.
Araico will lead local development and site infrastructure, while Crusoe will manage, operate and deliver the physical computing, the release says. The release does not mention ANDE, a tariff or a power contract.
Asked how Crusoe enters the business, Báez told ABC Color to find out the Kuntur-Araico relationship for itself, and said he understood Araico owns all of Kuntur. ABC Color’s account of the contract does not name Crusoe as a party.
The timelines also differ between sources. Zuccolillo says a US$300 million pilot is being built for delivery at the end of this year and operation early next year, while Riquelme expects the centre to run in the first quarter of 2027 and Crusoe says mid-2027.
Who Is Questioning the Deal
The state power workers’ union Sitrande said on Thursday that the scope of the arrangement was unclear. After the signing its general secretary, Adolfo Villalba, said the tariff is within the range and complies with what the law says, ABC Color reports.
Riquelme said ANDE has the autonomy and capacity to write and sign such contracts and called the rate a convenient price for the country. He put the full investment at US$12 billion, a figure that comes from Araico’s plans and that Crusoe’s release does not give.
Zuccolillo says the project would use less than 5% of the energy Paraguay cedes to Brazil. He also said the investment would multiply Paraguay’s foreign investment by ten, which is his own claim and not an independent estimate.
What It Means for You
For US investors and cloud customers, the contract shows the price of power behind a US-run AI site in South America, about 4.9 US cents per kilowatt-hour at the start and rising at least 2.5% a year. It does not show what Crusoe will charge for computing or who the customers will be.
The deal landed during President Santiago Peña’s Washington trip, which included a meeting with US Treasury Secretary Scott Bessent on 22 October, as we covered in Paraguay’s Peña Meets Treasury Chief, 22 Oct. Our guides Who Runs Paraguay’s Economy and Paraguay Explained cover the economy and politics behind the project.
Visitors and residents will not see the tariff on their own bills, since the contract covers an industrial customer. Our Asunción expat city guide covers day-to-day costs in the capital.
What Is Not Known
The contract text was not published, so the figures rest on ABC Color’s account of what ANDE’s president and the union leader said and on Última Hora’s interview with Araico’s director. We could not open an ANDE statement or the contract itself, and ANDE’s president announced a press conference in Encarnación for 3:30 p.m. on Friday whose details we did not find.
It is not known whether Crusoe is a party or guarantor, or what happens to the tariff if the campus uses less than the contracted power. The signing day is also given as both Thursday 22 and Friday 23 October.
Zuccolillo’s US$75 average and the US$12 billion investment are company or ministry claims that no document in these reports backs up. The reports reviewed also do not give the position of Brazil, the co-owner of Itaipú.
Frequently Asked Questions
What did ANDE agree to supply to the Paraguay AI hub?
ANDE agreed to supply up to 286 MW for 15 years to a data campus at Yguazú. Supply starts at 6 MW on 1 December 2026 and reaches 286 MW from April 2029.
How much will the Paraguay AI hub pay for power?
The tariff is US$48.91 per MWh on the 220-kilovolt line and US$56.39 on average at 23 kilovolts. It rises each year with US inflation, with a floor of 2.5%.
Is Crusoe a party to the ANDE contract?
The reports say the contract was signed with Kuntur, a Paraguayan company linked to Araico, and do not name Crusoe. Crusoe says it will run the AI computing with Araico beside the Itaipú substation.
When will the Paraguay AI hub start running?
Sources differ, with Araico saying early next year, the industry minister saying the first quarter of 2027 and Crusoe saying mid-2027. The contract itself starts supply on 1 December 2026.
Why does this matter to US readers?
A US company says it will serve US cloud customers from the Paraguayan site, so the power price shapes its costs. The contract is the first public price for that electricity.
Sources: ABC Color, 23 October 2026; Última Hora, 23 October 2026; ABC Color on the industry minister, 23 October 2026; Crusoe press release, 22 October 2026.
Editorial responsibility: Matthias Camenzind, Editor-in-Chief · Editorial standards · Report an error