Implications to the electricity system of Paraguay of different demand scenarios and export prices to Brazil

Abstract

Paraguay's power system is based entirely on hydropower. It serves as the largest net electricity exporter in Latin America. Nonetheless, the country´s electricity consumption per capita is one of the lowest in the world and the transmission and distribution network has one of the highest losses in Latin America. This paper presents an electricity expansion investment outlook (2018–2040) for Paraguay using OSeMOSYS, analyzing three electricity demand scenarios under different electricity export prices to Brazil. The study identifies the least-cost power generation mix, future investments and the financial requirements to meet the needs of different demand scenarios. We find that Paraguay will need to invest in hydropower plants, by mainly expanding the capacity of Yacyreta to cover its electricity needs and sustain national electricity exports levels. In the High demand scenario, where the electricity demand could approximately double by 2040, the country's overall electricity exports decrease by 50% compared to the Reference scenario. Based on the different scenarios examined, the government spends approximately 18.3–31.2 billion USD on power plant investments for the period 2018–2040 to cover future electricity demand. The findings could be useful in supporting decision-making concerning socio-economic development pathways in the country.

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“…OSeMOSYS is widely recognized as an accessible, straightforward, and quick-learning tool with many capacitybuilding resources and communities of practice [112]. Different studies have implemented OSeMOSYS to evaluate the sustainable expansion of national power systems [113][114][115][116][117][118][119][120][121][122][123][124] or the combination of power and transport sectors [119]. In addition, a recent work explored energy planning in the power sector to integrate electrolytic hydrogen dedicated to exports in Chile [125].…”

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