Original conceptual illustration by Radar Inversión; not an actual facility.
Published: October 27, 2026 · Radar Inversión
ANDE and Kuntur S.A., linked to Araico, signed a 15-year power supply contract on October 22 for AI infrastructure in Yguazú. Deliveries should begin at 6 MW on December 1, 2026, eventually rising to a maximum of 286 MW in April 2029. The full capacity is not in use today.
Contract terms
ANDE reports average tariffs of USD 56.39/MWh at 23 kV and USD 48.91/MWh at 220 kV, annual adjustments tied to US inflation with a 2.5% floor, and generation cost reviews every two years. Kuntur will pay for the connection works at Yguazú.
Why it is controversial
According to ANDE, approximately 750 MW are available for new projects, versus expressions of interest totaling about 6,000 MW. Such inquiries are not firm contracts. Allocating 286 MW to Kuntur leaves roughly 464 MW of the identified capacity. An ANDE engineers' association has proposed competitive tenders for energy-intensive firms. This discussion does not by itself prove irregularities.
Impact on Paraguay
AI infrastructure may bring investment, service demand and electricity revenue, but locking up capacity for 15 years limits other industrial options. Net employment effects, residential tariff implications and ANDE profitability have not yet been established. Hypothetically, 286 MW supplied nonstop for 8,760 hours at USD 48.91/MWh would produce roughly USD 122.5 million in gross annual billings, not a forecast, guaranteed revenue or profit.
Radar assessment | Paraguay must decide what its electricity is worth and what development it should support
The ANDE–Kuntur agreement raises an issue extending far beyond data centers and artificial intelligence: Paraguay is beginning to commit part of its electricity capacity to long-term projects without a public framework for measuring the full economic return of those decisions.
For decades, abundant hydropower has been presented as a national competitive advantage. Yet relatively inexpensive electricity does not automatically produce industrialization, technology transfer or sustainable development. The challenge is turning that resource into productive investment, jobs, expertise and greater economic income.
The price of electricity is not its economic value
The reported tariff of USD 48.91/MWh at 220 kV is central to the agreement, but cannot alone establish whether it benefits Paraguay. Profitability depends on actual supply costs, required investment, contractual terms and real consumption. There is also a less visible factor: opportunity cost.
Committing up to 286 MW for 15 years means that capacity cannot simultaneously be allocated to other projects. The choice favors one use over alternatives that could generate different levels of employment, exports, tax receipts and industrial linkages. That does not mean a data center is necessarily less beneficial than a factory. It means Paraguay needs tools to compare both models using verifiable economic criteria.
The risk of becoming merely a low-cost electricity supplier
AI data centers may attract major investments and build digital infrastructure. Their relationship between electricity consumption and direct employment, however, often differs from labor-intensive manufacturing. Announced capital expenditure should therefore not be the only measure of success.
Decision-makers need to know how much capital will actually be spent locally, how many Paraguayan suppliers will participate, which technical capabilities will be developed and what share of tax and commercial income will remain in the national economy.
Otherwise, Paraguay could become an attractive destination for international electricity-intensive operators without capturing a proportionate share of the value created by the technology those resources power.
Available capacity already requires allocation choices
The gap between the approximately 750 MW identified by ANDE as available for new projects and expressions of interest totaling roughly 6,000 MW suggests growing pressure on supply capacity. Expressions of interest are not binding contracts, but they demonstrate why priorities are needed.
Competitive allocation mechanisms deserve technical consideration: they could help establish how much investors are willing to pay and what additional benefits projects offer. Yet awarding electricity solely to the highest bidder would not necessarily maximize development. Energy policy must weigh profitability, employment, investment, productive diversification, infrastructure and security of supply together.
An opportunity to rethink industrial policy
Kuntur may help position Paraguay in the digital economy. Its strategic value will depend on results actually achieved and on institutions' ability to manage long-term electricity commitments. The debate should lead to transparent rules, comparable economic assessments and public monitoring.
Radar Inversión's conclusion is that Paraguay should not judge energy policy solely by megawatts contracted or investment dollars announced. It should measure the productive and economic value generated by every unit of electricity committed.
The ANDE–Kuntur agreement does not by itself establish that Paraguay has made a poor deal. But it raises a question that can no longer be postponed: is Paraguay developing a strategy to maximize the value of its energy, or responding separately to each investment opportunity that arrives?
The difference could shape the country's industrial competitiveness for decades.
Sources: ANDE, 23/10/2026; ABC Color, 24/10/2026; La Tribuna, 27/10/2026.