Warning: Bitcoin mining may cause the collapse of the Paraguayan power grid in 2029

The Federation of Paraguayan Industries (UIP) said that if demand continues to rise due to the growth of BitCoin Mining activities, Paraguay's power grid may collapse as early as 2029. The alliance recommends diversifying countries' energy sources and reducing their dependence on hydropower.

Bitcoin mining demand may trigger an energy collapse in Paraguay in 2029.

Paraguay, a country facing challenges due to the large influx of cryptocurrency mining companies to use cheap water and electricity, may face difficulties due to the increase in these activities.

According to the Federation of Industries of Paraguay (UIP), if demand continues to increase and power generation does not increase, it may collapse as early as 2029. Julio Fernandez, director of the UIP Economic Research Center, warned that demand has grown exponentially over the years.

Fernandez said:

- Itap and Yasireta are no longer enough. We consume more than an Itaip turbine every year.

Paraguay's electricity is almost entirely produced by the Itep Dam, which produced 83.879 teawatt-hours in 2023. However, the dam was built on the border between Brazil and Paraguay and operated together with the former, and Brazil also purchased electricity from the operations of Paraguay.

Even with this huge source of electricity, UIP still believes that a critical point is coming. Fernandez said, "We are very short of time. If we don't take action now, there will be a power outage. He reminded the authorities to take measures before this happened.

To avoid this collapse, one of the proposals put forward by UIP is to use the natural gas export agreement between Argentina and Brazil to provide access and establish power infrastructure to utilize this source of electricity.

"Paraguay can earn $400 million a year by charging alone. A gas-fired power plant will also provide electricity to the country and sell the surplus power to Brazil," Fernandez concluded.

Although the Paraguayan government is unfavorable to the mining policy and raising the energy price of Bitcoin mining, it still attracts companies like Hive Digital, which is expected to increase production capacity by 400% after completing its 200 MW site.