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Paraguay engineers threaten legal action over proposed low energy tariff for Atome
🇵🇾 Paraguay /Energy & Infrastructure

Paraguay engineers threaten legal action over proposed low energy tariff for Atome

From ABC Color · () Spanish

Translated from Spanish, summarized and contextualized by DistantNews.

At a glance

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  • The Union of ANDE Engineers (UIA) in Paraguay threatens legal action if the government approves a proposed energy sale agreement with Atome at a low tariff.
  • Atome seeks to purchase energy at $30 per megawatt-hour (MWh) for 15 years, while the UIA advocates for a higher rate of $56/MWh with shorter contract terms.
  • The UIA estimates the lower tariff would cost ANDE $30 million annually, totaling $450 million over the contract's duration, and questions Atome's promised industrial investment and job creation.

Paraguay's National Electricity Administration (ANDE) engineers are poised to challenge a proposed energy sale agreement with the company Atome, warning they will pursue a resource of unconstitutionality if the government approves the deal at the proposed tariff. The Union of ANDE Engineers (UIA) argues that the $30 per megawatt-hour (MWh) rate sought by Atome for a 15-year contract is significantly detrimental to ANDE's financial stability.

We, from ANDE, have a technical tariff that, if we sit down to analyze it, is outdated, but it is the closest approximation, which is US$ 44. US$ 30 is very far below.

— Manuel MettelPresident of the Union of ANDE Engineers explaining the proposed tariff difference.

Manuel Mettel, president of the UIA, explained that while ANDE's technical tariff is approximately $44/MWh, the union proposes a rate of $56/MWh, including an additional $12 for energy cession. They also advocate for shorter contract durations of two to three years with regular reviews, and potentially linking the tariff to the Consumer Price Index (IPC) to maintain its value. Mettel stated that the $30/MWh rate is "far too low" and would result in an estimated loss of $30 million per year for ANDE, accumulating to $450 million over the 15-year contract period.

These companies demand 15-year contracts. All of us, after 3 to 4 years, will have to pay more or less the same as these companies that are under 15-year agreements.

— Manuel MettelUnion of ANDE Engineers president expressing concern over long-term contracts.

The UIA also expressed skepticism regarding Atome's announced industrial investment and its impact on job creation, suggesting the required labor for such operations is minimal. Furthermore, the engineers are concerned about the implications for future contract renewals with cryptocurrency miners, whose current tariffs expire in 2027. The UIA suggests limiting energy contracts for crypto miners and data centers to 700 MW to preserve energy capacity and avoid the need for accelerated investment in new generation sources.

We do not see the investment we hear about. We know they will not generate much employment. The labor needed to operate this type of industry is minimal.

— Manuel MettelUnion of ANDE Engineers president questioning Atome's investment and job creation claims.
DistantNews Editorial

Originally published by ABC Color in Spanish. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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