The power grid is suffering as a result of the boom the nation is going through, as many miners are connecting illegally and using a lot of power without paying for it.
Expansion of illegal bitcoin mining operations may have an impact on the stability of the country's electrical grid.
The power grid is suffering as a result of the boom the nation is going through, as many miners are connecting illegally and using a lot of power without paying for it.
Underground Mining in Paraguay Increases
The electric grid is being negatively impacted by Paraguay's reputation as a nation with low power costs for bitcoin mining, which could undermine the country's ability to maintain a stable power system. The National Power Administration, ANDE, reported on October 28 that the recent rise in bitcoin mining has significantly increased the department of Alto Parana's power consumption, with several companies connecting to the grid illegally.
This has forced the group to increase monitoring in the area and ramp up supervision activities to discover covert links on the border with Brazil, said Miguel Angel Baez, technical director of the ANDE organisation.
Baez claims that when the business notices and disconnects an operation, two others start up. According to reports, each of these clandestine operations can require as much electricity as an apartment building does in a day.
The region has had this problem before. Some miners who had committed crimes involving power had their power disconnected in the past by the National Power Administration. Alfredo Arguello, the director of the East Regional Management Division, claimed in August that during monitoring visits, they had found abnormalities such as direct connections, bypass connections, and changed power metres. These errors caused losses that exceeded $400,000 per month.
Unique Bitcoin Mining Charges
The National Power Administration opposed the proposed bitcoin fee, which set the maximum price to be just 15% higher than what is collected from other comparable enterprises, due to the market conditions. The group declared at the time that it would support a potential veto of the law in light of that consideration and suggest a new set of electricity fees.
President Mario Abdo vetoed the cryptocurrency bill on September 2 because it would have improved the regulation of the bitcoin mining sector and was an energy-intensive enterprise with no need for employees. On September 30, the Paraguayan Senate overruled the veto, and Congress moved to enact the legislation without the support of the President.
Despite this, bitcoin mining businesses continue to find Paraguay to be a desirable location. Pow.re, a bitcoin mining business, declared on October 14 that it has begun building two mining facilities in the nation that will control 12 MW of hydroelectric electricity.
