Paraguay National Power Administration Proposes Crypto Mining Fee

The National Power Administration of Paraguay

recommended establishing a separate mining fee for cryptocurrency mining activities in a decree proposal intended to the national economic team. 

Due to the organization's massive losses, it has ceased delivering electricity to several mining companies that were dodging payment of electricity bills and were illegally linked to the grid.

The National Power Administration is proposing a new method of taxing cryptocurrency businesses for electricity used in mining activities in Paraguay. The organization has presented the national economic team with a new decree proposal that would collect payments for these services in advance in US dollars, with an annual adjustment. In addition, this plan would establish a new billing group for these operations.

Alfredo Argüello, the director of the East Regional Management Division, revealed that when evaluating various cryptocurrency mining companies, the organization was able to uncover abnormalities in some of them, resulting in a monthly loss of more than $400,000 According to Argüello, some of these abnormalities included direct connections, bypass connections, and manipulated power meters.

As a result, the firm is suspending power supplies to these businesses until a new power pricing system for these businesses is established, a subject that is already being debated in the Paraguayan Senate.

The Cryptocurrency Cloud mining activity in Paraguay has increased due to the low rates that power providers charge for energy. Following the Chinese mining ban, which prompted many mining operators to leave the nation and seek alternative sites for their operations, several businesses have indicated an interest in starting operations in Paraguay.

In July, the Senate passed legislation that, if passed, will offer clarity to these operations in the country. The bill, which is still awaiting approval from the Paraguayan president, states that electricity given to mining businesses would continue to be subsidized, but at a cost that is 15% more than what other businesses now pay.

In response to this, the head of the National Power Administration, Felix Sosa, stated, "At that time, we feel it must respond to a cost structure in order for the installation of electrical energy supply to be profitable."