PARAGUAY TRENDS AND DEVELOPMENTS Contributed by: Federico Valinotti, Andrés Nasser, Álvaro Rojas, Vivian Maldonado and Juan Manuel Ros, BKM - Berkemeyer
ing, procurement and oversight. With transparent accounting of contingent liabilities and co-ordinated institutional execution, the framework aims to unlock a sustainable pipeline of high-impact projects. Commuter Train Law and rail investment architecture The sector-specific Commuter Train Law (Law No 7434/2025) establishes the legal, institutional and financial framework for rehabilitating the historic “Presidente Carlos Antonio López” corridor and launching the Asunción–Ypacaraí commuter rail ser - vice. It reconfirms FEPASA as the national railway concessionaire and structures market delivery through sub-concessions awarded via competitive processes for up to 35 years under a design, finance, construct, operate, maintain and transfer (DFCOMT) model. A favourable opinion from the National Council of Public Companies is required at award, embedding public oversight. A defining feature is a dedicated trust managed by the Development Finance Agency (AFD), capitalised annually by the state to cover firm obligations plus a 10% buffer, with non-revertible funds during the con - cession term. The trust aggregates budget transfers, private capital and operating revenues, providing a predictable payment waterfall for progress-linked investment payments (PDIs) during construction, and availability payments (PPDs) during operations. Regu - lated fare revenues and ancillary income complement the revenue stack, with indexation and change-in-law allocations to be detailed in tender documents. The law modernises land assembly by recognising expropriation compensation within project financing and delegating execution to the sub-concessionaire under state oversight. It anticipates robust interface and performance regimes, lender step-in and secu - rity rights through direct agreements, and termination compensation principles suitable for bankability. Two preliminary capital expenditure scenarios illus - trate scale: a single major viaduct option near USD524 million, and a dual-viaduct option near USD584 mil - lion, with operating expenses preliminarily estimat - ed at around USD16.5 million annually. The statute expressly accommodates foreign participation via
consortia with Paraguayan firms, aligning with inter - national practice and facilitating technology transfer and local capacity-building. Energy Policy and regional interconnection Paraguay’s 2024–2050 Energy Policy remains the organising vision for a resilient, hydro-led but diversi - fied matrix. The 2025 news flow adds concrete vec - tors: • the National Electricity Administration (ANDE) has initiated a programme of investment into high-volt - age capacity and substation modernisation; • early-stage signals on small hydroelectric plants (PCHs); • the pipeline Memorandum of Understanding with Mato Grosso do Sul; and • the enabling of renewables under the new PPP law. The strategic constant is predictability – clarified gov - ernance, consumer protection and explicit accom - modation of technology evolution. For industrial investors, this offers credible assumptions on supply reliability and price stability over long horizons, paired with optionality to contract around distributed genera - tion, storage or regional swaps. Non-conventional renewable energy (NCRE) regime Responding to rapid demand growth, climate variabil - ity affecting hydro-generation, and the emergence of energy-intensive loads such as cryptocurrency min - ing, Paraguay enacted Law No 6977/2023 and Decree No 1168/24 to promote generation from non-hydraulic renewable sources. The Ministry of Public Works and Communications, through the Vice Ministry of Mines and Energy, is the competent authority for licensing, technical standards and policy implementation, in co- ordination with ANDE. Licences are granted for 15 years and are renew - able, covering self-generation, cogeneration, utility- scale generation and export, with defined grounds for assignment, cancellation and supervision. A parlia - mentary discussion is pending on extending licence terms to 30 years to support long-term financing. The regime specifies comprehensive technical intercon - nection requirements by voltage level and modelling
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