Paraguay faces critical energy decade without clear production model

Paraguay is heading into its most decisive energy period, between 2028 and 2030, without a clear plan for its electricity production model. Dr. Cecilia Llamosas, an energy policy expert, warns that the country has not yet defined what productive model it seeks to drive with its power.

The energy sector has seen profound changes, with consumption rising 10.5% annually and power demand increasing 8.2% between 2020 and 2025. The national electric system currently uses about 75% of its available capacity. Llamosas notes that the national power company, ANDE, has managed to absorb demand increases of 18.5% in 2024 and 12.5% in 2025, reaching peaks over 5,000 MW, without widespread blackouts. However, she cautions that technical reports place the critical threshold between 2028 and 2030.

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The tariff went through debates and ups and downs that served no one. Tariff predictability is not a technicality, but the condition for attracting serious players and obtaining the investments we need to improve the quality of service for all users in Paraguay.

This critical period is exacerbated by a backlog of large power requests totaling 6,300 MW. Llamosas emphasizes the gravity of this situation, stating that the accumulation of requests, exceeding the country's peak consumption, signals future challenges. While acknowledging institutional achievements like a 2024 tariff agreement, a new 500 kV substation, a law for private non-hydroelectric generation, and a public consultation for a Ministry of Energy, she criticizes the instability surrounding electricity tariffs.

Llamosas argues that the unpredictable tariff debates have harmed industries and consumers alike. She stresses that tariff predictability is essential for attracting serious investors and securing the necessary investments to improve service quality for all users. To avert a potential collapse, she proposes three indispensable agreements for the remaining term of the current government and the incoming administration: establishing an independent regulatory body with binding tariff authority, implementing strict deposit and penalty systems for power requests, and monthly monitoring of transmission line execution as a key indicator of industrial development.

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With that rule, 6,300 MW are a portfolio; without it, they are a queue. That ANDE accumulates more than the country consumes in its peak hour speaks volumes about what is coming.