The National Electricity Administration of Paraguay has proposed setting a special mining fee for cryptocurrency mining operations in a draft decree addressed to the national economic team. Due to the immense losses the organization faced, it stopped supplying power to some mining operations that were evading the payment of electricity bills, being illegally connected to the grid.
National Electricity Administration to Change Electricity Billing Structure for Mining Operations in Paraguay
The National Power Administration is proposing a new way to charge cryptocurrency companies for electricity used in mining operations in Paraguay. The company submitted a new executive order proposal to the National Economics Team that would collect payments for these services up front in US dollars, and with an annual adjustment. This proposal would also create a new billing group for these activities.
The head of the Eastern Regional Management Division, Alfredo Argüello, said that by inspecting different cryptocurrency mining operations, the group was able to detect irregularities in some of them that led to the loss more than $400,000 per month. Some of those irregularities included direct connections, bypass connections and modified power meters, Argüello informed.
As a result, the company is shutting down the power supply to these companies until a new electricity billing structure is approved for these entities, an issue that is already being discussed in the Paraguayan senate.
Cryptocurrency Laws Ready
The cryptocurrency mining activity in Paraguay has seen a boom due to the cheap fees that power companies actually charge for electricity. Several companies have expressed interest in establishing themselves in Paraguay after the Chinese mining ban, which forced many miners to leave the country and seek new lands to carry out their activities.
The Senate passed a bill in July that, if approved, will bring clarity to these operations in the country. The law, which still awaits assent from the Paraguayan president, establishes that the energy supplied to mining operations will still be subsidized, but must be set at a rate 15% higher than what other industries currently pay.
In this regard, National Power Administration Chairman Felix Sosa said:
At this point, we believe it must meet a cost structure so that it is viable for the installation of the electrical power supply.
Additionally, Sosa said he will offer a partial veto to this bill because of the proposals he is making regarding the billing of electricity to these companies.
What do you think of the new proposal from the National Electricity Administration in Paraguay? Tell us in the comments section below.
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