Business · Energy & Commodities · 4 hrs ago
Rising Paraguayan use of Itaipu power may push up Brazilian prices
Paraguay’s rising use of Itaipu power could raise electricity prices in Brazil, especially during the evening peak.
The Itaipu dam is shared by Brazil and Paraguay, which each have a right to half its electricity; Brazil has traditionally bought power Paraguay does not use.
Paraguayan demand has grown quickly, driven in part by cryptocurrency mining and data centers, and almost all of it is supplied by Itaipu.
The two countries’ evening demand peaks at around the same time, so more Paraguayan use could leave less power for Brazil when its system needs it most.
Itaú BBA estimates that from 2027, thermal power generation could rise by about 11% a year through 2029, while the average marginal price could increase from 40 to 59 reais per megawatt-hour.
Some Brazilian distributors could face power shortfalls in 2027 and need to buy electricity on the short-term market.
The distributors’ association has asked Brazil’s energy regulator and government to set the amount of Itaipu power assigned to Paraguay for 2027 in time, and to let distributors revise their needs if that amount changes significantly.
Rising Paraguayan use of electricity from the Itaipu hydroelectric plant could reduce supply available to Brazil and put upward pressure on Brazilian power prices, Itaú BBA says.
The bank says the effect is expected to become more evident from 2027, when Brazil’s system operator adopts a new method to forecast demand from Paraguay’s state electricity company, Ande.
Paraguay’s electricity demand grew by 12% to 18% a year from 2023 to 2025, reaching an average load of 3.3 gigawatts in 2025, according to the bank.
The bank estimates that thermal power generation could rise by nearly 11% a year in 2027–29, while the average marginal price could increase from R$40 to R$59 per megawatt-hour.
Brazilian electricity distributors that buy Itaipu power may also face a shortfall in contracted supply in 2027, according to the Brazilian distributors’ association.
- Who
- Itaú BBA says rising Paraguayan use of Itaipu power could affect Brazilian prices. The Brazilian distributors’ association also warned of possible supply shortfalls for distributors.
- What
- Greater Paraguayan consumption could leave less Itaipu electricity available to Brazil, raising prices and increasing reliance on thermal generation.
- When
- The effect on prices is expected to become more evident from 2027. Paraguayan demand rose from 2023 to 2025.
- Where
- Itaipu, a binational hydroelectric plant shared by Brazil and Paraguay, and Brazil’s electricity system.
- Why
- Paraguay’s electricity demand has grown, driven in part by cryptocurrency mining and data centers, and its evening peak coincides with Brazil’s.
This story does not have two clearly opposing sides.
Paraguay’s electricity demand grew by 12% to 18% a year and reached an average load of 3.3 GW in 2025, according to Itaú BBA.
Ande’s demand at the evening peak is forecast to reach 4.0 GW, according to the bank.
The effect on Brazilian prices is expected to become more evident as the system operator adopts a new method to forecast Ande’s demand.
Itaú BBA estimates thermal generation will rise by nearly 11% a year and the average marginal price will increase from R$40 to R$59 per MWh.
- Itaipu capacity
- 14 GW
- Paraguay’s average load in 2025
- 3.3 GW
- Ande peak demand in 2026
- 4.0 GW
- Ande peak demand in 2029
- 4.7 GW
- Estimated average marginal price
- R$40 to R$59 per MWh
- Forecast period
- 2027–2029
1 source
What people are saying
Between April and September, Paraguay’s load peak occurs at 6 p.m., coinciding with the Brazilian National Interconnected System’s net load peak. Ande’s demand at that time is expected to grow from 4.0 GW in 2026 to 4.7 GW in 2029, reducing the Itaipu energy available to Brazil precisely when the system needs it most.