Paraguay faces a growing challenge in balancing its industrialization strategy with ensuring energy security, which is essential for domestic consumption and sustainable economic development. Experts warn that the rapid increase in energy demand, driven by the establishment of high-consumption industries, requires a careful review of the national energy policy.
The country, which has historically benefited from the abundance of hydroelectric power generated by the binational Itaipú and Yacyretá dams, now needs to plan the expansion and diversification of its energy matrix to avoid future supply risks. Engineer Victorio Oxilia Dávalos emphasized the importance of adhering to the National Energy Strategy in effect until 2050, which aims to guarantee a secure energy supply for the entire population.
Oxilia also supported the government’s decision to revoke decrees 5,306 and 5,307, which sought to attract electro-intensive industries with special conditions, stressing that any industrialization policy must align with the long-term energy strategy. According to him, the room to ensure energy security is shrinking, and the country could face limitations in generation, transmission, and distribution if it does not invest in infrastructure and diversify its energy sources.
Additionally, Paraguay is promoting regulatory frameworks to attract energy-intensive industrial projects, such as convergent industries and Power to X ventures focused on producing synthetic fuels and other high value-added technologies. While these initiatives may create jobs and boost exports, they also increase pressure on the national electric system.
The current debate goes beyond simply how much energy to generate or export, focusing instead on defining which sectors will have priority in using the available energy and how to ensure that industrial growth does not compromise competitiveness and energy security for future generations. The new National Energy Policy through 2050 seeks to strengthen the electric sector, diversify sources, and ensure the system’s sustainability amid rising demand.
Paraguay’s ability to coordinate these goals will be decisive in keeping energy a competitive advantage rather than turning it into an obstacle to the country’s economic development in the coming decades.