Paraguay plans to terminate special electricity contracts for mining companies by the end of 2027, as AI competes for hydropower.

Paraguay's state utility ANDE plans to let all special power contracts for crypto miners expire on December 31, 2027, as rising domestic demand and competition from AI firms for cheap hydropower strain supply. ANDE expects to collect $350 million from crypto miners in 2026, with miners holding contracts for roughly 944 MW of power as of April. Company engineers have proposed capping combined mining, AI and data-center power use at 700 MW from 2028 and allocating electricity through auctions, though the plan has not yet been adopted. Meanwhile, Kuntur, an entity tied to the Iguazú AI City project, has signed a 15-year supply agreement with ANDE for up to 286 MW. The shift matters because it signals that AI's power needs are beginning to displace bitcoin mining from one of its cheapest hydro-rich jurisdictions. What to watch next is whether ANDE adopts the 700 MW cap and auction mechanism, and how miners plan to replace or renegotiate their expiring contracts.