The country is seeking to position itself as a technological hub in Latin America by developing digital infrastructure and attracting electro-intensive companies, which represents an opportunity according to a study by the National University of Asunción.
Paraguay is at a key crossroads in its energy history. With the Itaipu debt paid off and a surplus of electricity traditionally distributed to Brazil and Argentina, the Guaraní nation has the opportunity to transform its productive matrix through the data center industry.
This is according to a report by the Energy Systems Research Group (GISE) of the Polytechnic Faculty of the National University of Asunción (FPUNA), which highlights the potential of this sector to generate skilled employment and strengthen the national electrical infrastructure.
GISE is comprised of more than 40 researchers, including doctors, master's degree holders, engineers, and undergraduate students from various UNA faculties.
According to the study, the development of data centers in Paraguay would finance up to 39% of investments in electricity generation and 17% of investments in transmission between 2024 and 2027.
These figures would far exceed the revenue obtained from energy transfers to neighboring countries, which currently only benefit the Ministry of Economy and Finance (MEF), while sales to data centers would provide additional revenue to the National Electricity Administration (ANDE) and boost tax collection.
"A technological hub is being consolidated to develop data center infrastructure in Paraguay," said Diego García, president of the Paraguayan Fintech Chamber.
This vision aligns with the interest in attracting global companies, such as Amazon and Google, that are looking for locations with clean energy and affordable costs.
competitive.
The report highlights that, in an optimistic scenario, energy sales to data centers could generate US$1.087 billion in revenue over the next four years, with a positive impact on the modernization of the electrical system.
These resources could be used to improve transmission and distribution, as well as to electrify rural areas.
In addition to the economic benefits, data centers represent a sustainable alternative. By operating with 100% renewable energy from Paraguayan hydroelectric plants, they minimize the carbon footprint and strengthen Paraguay's competitiveness in the region.
This combination of advantages has made the country an attractive destination for investments in digital infrastructure.
The GISE analysis also raises an opportunity cost for the country: each megawatt-hour (MWh) transferred to Brazil generates US$10 for the MEF, while sales to data centers could generate US$44 per MWh, with the revenue distributed among ANDE, the MEF, and the labor sector.
The recent tariff adjustment implemented by ANDE for the Special Intensive Consumption Group, which includes data centers, raised the average cost from US$39/MWh to US$44/MWh, further increasing the profitability of this alternative.
The study concludes that Paraguay has the key elements to consolidate its position as a regional technology hub : abundant energy, a strategic location, and attractive costs.
The decision on how to use its energy surplus will define the country's course in the coming years and determine whether it can capitalize on this historic opportunity for its economic and technological development.
