22OCT

Crusoe plans AI site on Itaipu power

2 min read

16:40UTC

The US State Department announced a Crusoe and Araico deal to build AI computing in Paraguay on Itaipu power, with no capacity, site or investment figure.

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Key takeaway

Crusoe's Paraguay site depends on Itaipu sale terms Brazil and Paraguay have not yet agreed.

The US State Department announced on 21 October, during Deputy Secretary Christopher Landau's visit to Paraguay, that Crusoe and the Paraguayan developer Araico have agreed to build AI computing infrastructure powered by the Itaipu dam⁠¹. Crusoe, a US AI infrastructure company, plans an initial facility around mid-2027. The State Department gave no capacity, energy volume, site or investment figure.

Itaipu's output and administration are split equally between Brazil and Paraguay, and the US statement did not mention Brazil. Paraguay is renegotiating Annex C of the Itaipu Treaty, which sets its energy-sale rules, to win more freedom to sell its own share, Tribuna PR reported⁠². The power on offer depends on terms the two owners have not yet settled, while Brazil rations its own grid connections for data centres by auction.

Deep Analysis

In plain English

Itaipu is a huge hydroelectric dam on the river between Paraguay and Brazil. The two countries own it together and split its electricity equally. Crusoe is an American company that builds data centres for artificial intelligence (AI): buildings full of computer chips that use a lot of electricity. It has agreed with a Paraguayan company, Araico, to build such a site in Paraguay, running on power from Itaipu. The US government announced the deal but gave no details on size or cost. Paraguay and Brazil are still negotiating the rules on how each country may sell its share of the dam's power.

Deep Analysis

Root Causes

Itaipu's output and administration are split equally between Brazil and Paraguay, and Annex C sets how each side may sell its share. Paraguay's push for more freedom to sell is what makes a foreign data-centre buyer possible at all.

Washington paired the deal with diplomacy. The announcement came during Deputy Secretary Christopher Landau's visit, alongside US$11.75m in security assistance and a US$12m uranium concession investment by Uranium Energy Corp, CNN Brasil reported.

What could happen next?

Risk
Brazil may object if Paraguay commits Itaipu energy to a third party before Annex C is settled.
Opportunity
Paraguay could earn more from its Itaipu share by selling to data centres than under current rules.

Source Landscape

This story draws on neutral-leaning sources from United States

United States

LeftRight

Primary parallel: In June, Chevron's Energy Forge One signed a 20-year deal with Microsoft for a 2.67 GW gas plant built beside a West Texas data centre. Both tie an AI site to a single named power source, but in Texas the plant belongs to the project, while Itaipu belongs to two states.

Counter-parallel: On the Brazilian side, data centres reach power through the grid operator's queue. Aneel authorised Scala's AI City campus to connect, with the access opinion setting 120 MW from January 2028. Brazil allocates through its grid; Paraguay is offering a direct line to the dam.

The State Department said the project could be one of the largest private investments in Paraguay's history, but gave no figure. Crusoe plans to serve cloud customers in the United States and Latin America from the site.

Without a capacity or energy volume, the deal cannot yet be weighed against Itaipu's output or against Paraguay's own demand. The price of any power sold will turn on the Annex C talks.

Consensus view: Crusoe chief executive Chase Lochmiller said this week that finding powered land is the main constraint on AI builds, CNBC reported. Itaipu offers generation that already exists, so the pitch to Paraguay is speed to power rather than new plant.

Counter-view: Tribuna PR, writing from Brazil's Paraná state, frames the question as one of treaty rules. Paraguay is renegotiating Annex C of the Itaipu Treaty to win more freedom to sell its own share; until that is settled, how much power Crusoe can buy, and at what price, depends on Brazil as well.

Key tension: Whether Paraguay can commit Itaipu energy to a foreign data centre before the two owners agree the new sale rules.

Sources:CNN Brasil·CNN Brasil·Tribuna PR

Mentions:US State Department →Christopher Landau →Itaipu →Paraguay →Araico →Crusoe →Brazil →Itaipu Treaty →CNBC →Texas →Microsoft →Chevron →West Texas →Energy Forge One →Latin America →

First Reported In

Update #17 · Stalled power line cuts A$140m from NEXTDC guidance

CNN Brasil· 22 Oct 2026

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