Brazil may consider renegotiation, or maybe looking to another supplier who could still supply electricity to them at the same rate, or even better now increase their attention to become energy self sufficient.Paraguayan Senate Supports Selling Power to Crypto Mining Companies, Criticizes Subpar Energy Agreements With Brazil
The Paraguayan Senate has approved a resolution supporting selling the country’s energy surplus to crypto mining companies, given the price and guarantees that these institutions offer. The declaration criticizes the subpar agreements that sell energy to Brazil... See more for yourself here (https://news.bitcoin.com/paraguayan-senate-supports-selling-power-to-crypto-mining-companies-criticizes-subpar-energy-agreements-with-brazil/).
Your opinion is greatly appreciated.
Why would power be sold to another country for a lower rate when there is a good, lucrative alternative, the crypto mining operators?
Because it was the agreement when the Itaipu dam, which sits on the border between Paraguay and Brazil was constructed.?Of course, it is not worth it, but if Brazil and Paraguay own this dam, which is used to generate energy, there must be international agreements that determine each country’s shares of energy, and it is certain that Paraguay will not violate international law in selling Brazil’s dues to other parties, such as mining companies or others.
Because both Brazil and Paraguay own that dam?
Also, because Brazil is Paraguay's largest trade partner, what happens after you piss them off and if your bet on mining goes south?
You have one angry neighbor, a fucked up trade balance, and electricity you can't sell to anyone anymore!
Is it worth the gamble for a country 30 times smaller than Brazil?
~Of course, it is not worth it, but if Brazil and Paraguay own this dam, which is used to generate energy, there must be international agreements that determine each country’s shares of energy, and it is certain that Paraguay will not violate international law in selling Brazil’s dues to other parties, such as mining companies or others.
As I read in the article, the Paraguayan Senate approved a resolution supporting the sale of the country’s surplus energy to cryptocurrency mining companies. According to my understanding, only Paraguay’s surplus energy will be sold, and Brazil’s share will not be affected, Although the announcement criticized substandard agreements that sell energy to Brazil for 25% of the fees collected
As I said, things are more complicated than just then, there is a provision on excess generation in which Brazil claims it would have priority on buying that, Paraguay says ok but not at the same price as the mandatory quota, Brazil says no, the same price and .....we have the current situation.+1
The main problem is if you're thinking long term
- unless the world goes nuclear Brazil will still be there in 100 years and be your 30x in size neighbor
- The US/EU/ bans crypto, Bitcoin switched to PoS, another currency comes out, etc and mining turns out to be a dead business returning 10 cents a day
Foreign relations are complicated, your biggest parent slapping you with some tariffs and everything you own is down the drain, things are not as easy as it might seem, in theory is simple, let's sell this for more but...
Buzarquis stated that energy sales for cryptocurrency mining allowed the National Power Administration (ANDE) to rake in over $100 million yearly, with “never before seen” guarantees from companies in the sector. According to Buzarquis, over 45 crypto-mining companies installed in Paraguay pay power tariffs ranging from $40 plus taxes per MWh to $52 plus taxes per MWh.
The Paraguayan Senate has made a very wise move in this regard. Because the decision also looks like it will bring many benefits to the country itself. As I read in the news attached to the OP and I quote it below the points that I find interesting.Quote from: https://news.bitcoin.com/paraguayan-senate-supports-selling-power-to-crypto-mining-companies-criticizes-subpar-energy-agreements-with-brazil/Buzarquis stated that energy sales for cryptocurrency mining allowed the National Power Administration (ANDE) to rake in over $100 million yearly, with “never before seen” guarantees from companies in the sector. According to Buzarquis, over 45 crypto-mining companies installed in Paraguay pay power tariffs ranging from $40 plus taxes per MWh to $52 plus taxes per MWh.